KRAFTON posts record-high quarterly sales of KRW538.7B in 1Q23

KRAFTON (CEO CH Kim) announced its 1Q23 preliminary earnings on May 9. KRAFTON recorded its 1Q23 sales at KRW538.7B, OP at KRW283B and NP at KRW267.2B in accordance with the Korean International Financial Reporting Standards (K-IFRS). Consolidated sales climbed 14% QoQ and 3% YoY in 1Q23, rewriting its record quarterly sales. OP spiked 124% QoQ with OPM reaching 53%. Especially when excluding stock compensation costs from OP, OP in 1Q23 amounts to KRW293B, which is a 12% YoY increase. NP turned to profit QoQ with NPM of 50% in 1Q23.  

PC/Console of PUBG: BATTLEGROUNDS hit an all-time high in-game sales fueled by increasing traffic and the popularity of new paid content. In particular, PC sales grew 28% QoQ and 68% YoY, significantly contributing to sales growth with a 33% share of the total sales. PUBG: BATTLEGROUNDS, which marked its 6^th anniversary in March, plans to boost its upturn by launching diverse updates to maximize fun elements for users such as Arcade update, addition of Clan systems, supercar collaborations and new map releases. 

The mobile business has been securing growth through the expansion of new traffic inflow. ‘World of Wonder,’ a sandbox mode introduced in 1Q allowing users to create their own maps, has been receiving positive responses, and the company also plans to increase its monetization efficiency by launching progressive skins and collaborations with global brands in 2Q.  

Under the strategic direction of “Scale-up the Creative,” KRAFTON will step up its efforts to take a new leap forward in the role of a global publisher. “Scale-up the Creative”‘ strategy aims to discover creativity and scale up growth through KRAFTON’s self-developed games and minority stake investments. Accordingly, it plans to establish a healthy communication system between KRAFTON and independent studios, as well as to develop a production process that includes thorough review and testing. 

Since early-2023, the company has been focusing on securing global second publishing capabilities through in-house game development and minority investing, and 24 pipelines are currently being developed in KRAFTON’s ecosystem. Furthermore, it plans to implement a healthy communication system such as establishing a virtual organization for every game project to support each studio’s production and develop a more thorough framework for production management. 

KRAFTON is also committed to researching deep learning technologies for shortening game development time and implementing various features within games through proactive investments. Recently, the papers published by KRAFTON’s Deep Learning Division were accepted to top-tier conferences, and the company has achieved tangible results such as implementing technologies that enable cooperative play within games. 

KRAFTON’s CEO CH Kim said “KRAFTON has proven the continuous growth potential of the PUBG: BATTLEGROUNDS IP by achieving record results in the first quarter of 2023,” and added, “We will introduce new production management strategies to allow more games to get a chance to bat (in the market), and focus on global publishing to increase the chances of success for new games.” 

▲Table: KRAFTON’s 1Q23 (preliminary) earnings on a consolidated basis (unit: KRW100M)