K-game companies generate over half of their revenue overseas

‘Dungeon & Fighter Mobile’ officially launched in China on July 21st. [Courtesy of Nexon Corp.]

South Korea’s three major gaming companies - Nexon Corp., Netmarble Corp., and NCSoft Corp. - collectively generated more than 2 trillion won ($1.47 billion) in sales outside the country in the first half of 2024.

As the growth of the domestic game market stagnates, the gaming companies‘ strategy of releasing new games aimed at North America, the birthplace of the gaming industry, and China, the largest market, is starting to bear fruit this year, analysts noted.

According to sources from the gaming industry on Sunday, the combined overseas sales of the three companies totaled 2.45 trillion won in the first half of 2024, up 222.2 billion won from 2.23 trillion won a year ago.

By company, Nexon, which released its “killer intellectual properties (IPs)” in overseas markets during the cited period and recorded the highest revenue growth among the three companies. Its overseas revenue for the first half of 2024 totaled 1.10 trillion won, a significant increase from 874.9 billion won in the same period a year ago, and the proportion of its overseas sales also rose from 42 percent to 54 percent during the cited period. The company also earned 1.56 trillion won, or 40 percent, of its total revenue of 3.86 trillion won in 2023, and it is likely to post 2 trillion won in overseas revenue in 2024.

Nexon reported that its global sales of games released based on its three core IPs, “Dungeon & Fighter,” “MapleStory,” and “FC,” increased by 57 percent in the second quarter compared to the same period a year ago.

The performance of its new releases is also promising. Nexon saw its mobile game “Dungeon & Fighter Mobile,” launched in China in May 2024, achieve tremendous success, ranking first in global mobile game sales and driving its overseas performance. The company’s “The First Descendant,” released in July 2024, also ranked first in game sales in 13 countries within just a day of its launch.

For its part, Netmarble, which logged its highest quarterly revenue ever in the second quarter of 2024, also benefited from the overseas success of its new releases.

It succeeded in turning itself around with the global launch of its mobile game “Solo Leveling: Arise” in the first half of 2024 after experiencing eight consecutive quarters of losses until the fourth quarter of 2023. The game recorded cumulative sales of $70 million within just a month of its global release.

Netmarble generated 78 percent of its total revenue of 1.37 trillion won in the first half of 2024 from overseas. It plans to continue this momentum by launching “The Seven Deadly Sins: Grand Cross” in the global market on August 13th, 2024.

NCSoft, the sole company among the trio not to enjoy significant success, is in desperate need of a turnaround in overseas markets.

The company is said to be too dependent on its flagship “Lineage” IP, which accounts for 60 to 70 percent of its revenue but is primarily dominant in the domestic market. To reverse this trend, NCSoft plans to launch a new role-playing game (RPG), “Hoyeon,” in Korea, Japan, and Taiwan on August 28th, 2024. It will also begin the global service of “Throne and Liberty (TL)” on September 17th, in collaboration with Amazon Games.

NCSoft is also working on medium- to long-term improvements, recently investing in Sweden-based Moon Rover Games and Korea-based Big Game Studio to diversify its IP as well as target overseas markets.

Industry insiders note that the three companies, which have been criticized for focusing too much on variations of their existing famous IPs, are succeeding in transforming themselves to survive.

Nexon, which already has several overseas hits, has confirmed the release of its hardcore action RPG, “The First Berserker: Kazan,” for 2025, with Netmarble also planning to release four new games in 2024 followed by five or six more the year after.