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Netmarble profit tumbles 72% year-on-year in Q4 due to slowing sales and lack of new releases

Publisher appears to be struggling to fill the hole from fading Lineage 2 and Harry Potter revenue

Netmarble profit tumbles 72% year-on-year in Q4 due to slowing sales and lack of new releases

South Korean publisher Netmarble has taken a big hit to its net profit due to what it claims are slowing sales of its existing games like Jam City’s Harry Potter: Hogwarts Mystery and a lack of new releases.

For its Q4 2018 the company reported revenue of ₩487.1bn ($432m), down 20.9 per cent year-on-year and 7.4 per cent quarter-on-quarter.

Net profit meanwhile tumbled by 72.1% year-on-year and 73.5 per cent quarter-on-quarter to ₩14.6bn ($13m). Margins for net profit were three per cent.

International sales decline

Overseas revenue for the quarter was ₩332.7bn ($295m), which fell five per cent QoQ to 68 per cent of total sales.

North America is the company’s most lucrative market, making up 33 per cent of sales. That was followed closely by South Korea (32 per cent), Japan (12 per cent), Europe (10 per cent), Southeast Asia (nine per cent) and others (four per cent).

Lineage 2 Revolution remains the top earner for Netmarble, picking up 21 per cent of sales. The other big hits are Kabam’s Marvel Contest of Champions (18 per cent), and Jam City’s Cookie Jam (seven per cent) and Harry Potter: Hogwarts Mystery (seven per cent).

One of its latest launches, B&S Revolution, made up six per cent of sales for the quarter.

Looking ahead, Netmarble has a larger lineup for Q1 2019. The Seven Deadly Sins: Grand Cross is expected to start pre-registration this quarter in South Korea and Japan, while King of Fighters: All Star will begin pre-registrations in Korea.

Yokai Watch: Medal Wars is expected to launch by the end of March.

M&A

Netmarble has been linked with a large expansion of its business in recent months with the potential acquisition of rival publisher Nexon.

The company has confirmed its interest and recently it was reported that Tencent has joined its consortium to make a bid. Any deal for Nexon could cost in the region of $8.9 billion.

Catch up with more mobile games industry financials on our calendar here.


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A footy game fanatic and experienced editor of numerous computing and game titles, lively Chris is up for anything - including running Steel Media! (Madman!)