On September 3rd, NEXON hosted a Capital Markets Briefing (CMB) event in Japan, where they unveiled their ambitious plan to exceed 6 trillion KRW in revenue and approach 3 trillion KRW in operating profit by 2027.
The company stated that its growth strategy is based on lessons learned from past failures, focusing on two core pillars: leveraging the recognition of its existing IPs and ensuring high-quality game development with a deep understanding of those IPs.
NEXON plans to capitalize on its strengths to sustain growth and intends to continuously invest in companies and IPs that can create synergies with the company.
■ Below is a summary of the Q&A session with NEXON CEO Junghun Lee and CFO Shiro Uemura:
Q: Some Korean game companies are reusing their IPs, leading to player fatigue. How does NEXON's growth strategy differ from this?
Junghun Lee: Developing new titles based on existing IPs is a global trend. NEXON has extensive experience launching IP-based games, and we've learned valuable lessons from past failures. Our expansion strategy is built on two core elements. First, we focus on maximizing the recognition of our existing IPs, which can significantly reduce marketing costs. Second, we are committed to genre specialization. High-quality game development and a deep understanding of our IPs are crucial. We are focused on building a portfolio that captures the authentic charm and emotional depth of our IPs, leveraging their core attributes across various genres.
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Q: Are there any M&A plans using the company’s cash reserves?
Shiro Uemura: We are actively pursuing M&A opportunities, which will contribute to both vertical and horizontal expansion.
Junghun Lee: NEXON's management is open to M&A. However, our primary consideration is whether the IP has long-term value and can create synergy with us.
Q: Are there areas where you feel your genre expansion is lacking?
Junghun Lee: We believe that there's still room for improvement in our success in Western markets and Japan. Our three-year plan is built on the confidence that we can achieve solid results in these regions. In Japan, we’ve made significant investments in MapleStory, which is growing by double digits. Blue Archive has also established a strong foothold. Diversifying platforms is the natural path forward.
Q: How do you anticipate the regional breakdown of the projected 750 billion yen in revenue?
Junghun Lee: We've seen many instances where an overemphasis on success in a specific platform or region can lead to misconceptions. In preparing our horizontal strategy, we've already considered success across different regions and platforms. By staying true to the essence and attributes of our IPs and delivering games that resonate emotionally with fans, we believe we can achieve strong results across various markets.
Q: Why is the revenue split between vertical and horizontal expansion at a 3:7 ratio?
Junghun Lee: If we had announced a ten-year plan, the ratio would have been different. We presented realistic numbers within the scope of what we can disclose. Over a decade, we’ll have even more IPs, so the outcome could vary.
Q: What do you project the revenue share for the shooter genre will be by 2027?
Junghun Lee: We see the shooter genre as one of the largest globally. We're investing heavily to increase our market share. For instance, The First Descendant is showing strong revenue and user engagement on consoles. Please avoid making judgments based on partial information. We will continue to invest in both Embark Studios and NEXON’s live service capabilities.
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■ Shiro Uemura, the Chief Financial Officer (CFO) of NEXON Co., Ltd.
Q: Do you have any plans to expand your IPs through media mix strategies?
Shiro Uemura: We’ve invested in AGBO. We are considering expanding our IPs into various media formats, such as anime and TV series.
Q: What is your long-term perspective on console gaming?
Junghun Lee: We're not focusing on developing games or strategies tailored to specific platforms. Platforms are just one way we engage with our intellectual property. To expand our reach, we need to diversify. Console platforms dominate the Western market, so we’re strategically investing in this area. This approach will help us deliver even more polished games in the future.
Q: How has your approach to the Dungeon & Fighter IP changed compared to the past?
Shiro Uemura: A strong IP can serve as a foundation for creating a compelling world, which is key to developing successful games.
Junghun Lee: In the past, we tried to convert a 2D game to 3D simply, but it didn’t perform well. We invested a lot of effort in analyzing that failure, and we believe it led to better results. We are proactive in correcting processes based on lessons learned from failures.
Q: Do you consider cross-platform strategy aligned with NEXON’s philosophy?
Junghun Lee: FC offers different experiences depending on the platform. We plan to maximize this diversity. However, integrating console, PC, and mobile platforms is extremely challenging due to their differing update cycles. We will leverage our expertise to provide more advanced services.
Q: What is your strategy for ensuring the success of new IPs?
Junghun Lee: It’s often said in the industry that launching new titles is extremely difficult. However, I believe it comes down to the balance between an existing IP portfolio and a new IP portfolio. We aim to grow by investing in new IPs with the revenue generated from our established IPs.
김태만 기자 ktman21c@gamevu.co.kr
