Investors have moved to offload their shares in South Korean mobile games developer Netmarble following a disappointing Q2 earnings report.
As reported by The Investor, the firm’s shares dipped 11.27 per cent on August 9th to roughly $111, which is record low for Netmarble since it went public on May 12th last year.
According to its Q2 earnings revenue fell 7.2 per cent year-on-year to $444 million while profits dropped by 40.8 per cent year-on-year to $55.1 million.
One of the leading reasons for the dip was Lineage 2: Revolution’s declining popularity. That comes from Korea Securities and Investments analyst Kim Sung-eun who is quoted as saying the decline comes from “fierce competition among domestic massively multiplayer online role-playing games".
Playing the long game
Market observers are also said to be concerned about delays from the launch of Netmarble's new titles such as Blade & Soul revolution, with the title now believed to be launching in the fourth quarter.
Netmarble CEO Kwon Young-sig remarked in a conference call on August 8th that the company was thinking long-term.
“We are focusing on strengthening global competitiveness rather than concentrating on short-term profits,” he said.
Despite drops in revenue and profit, however, Netmarble did post strong sales overseas. For the three months ending June 2018 the company saw global sales jump three per cent year-on-year to $313 million.
While Lineage 2: Revolution has slowed down in pace according to Sensor Tower it still brings in around $30 million a month and has recently broken the $1 billion barrier in revenue.