Revenue down at Nexon as Dungeon&Fighter works to win back players

Quarterly revenue is down year-over-year for developer and publisher Nexon, a decline the company says was expected after exchange rate woes and an unpopular update cut revenue and engagement for Dungeon&Fighter in China.

In China, Nexon’s game Dungeon&Fighter released an update that wasn’t received well earlier this year, causing a significant drop in both engagement and revenue. The company expects it to take multiple quarters to fully recover from that poorly received update, but even then Dungeon&Fighter was weaker in Q3 than expected.

Despite that hiccup, Nexon cites its years of experience in managing live games and notes that it expects the 11-year-old franchise to bounce back and “grow to new heights in players, revenue, and, most of all, fun.”

That weaker quarter was offset somewhat by a strong period in Korea, where the company notes growth in Fifa Online 4 led to a year-over-year increase in PC online revenue, while mobile games like Fifa Online 4M and MapleStoryM helped increase mobile revenue. In Japan, North America, and Europe however, revenue decreased year-over-year as several games (including the semi-recently acquired Choices) started to decelerate.

For the quarter ending September 30, Nexon reported 52.357 billion yen (~$478.8 million) in revenue, down 24 percent year-over-year but a decrease the company had expected. By platform, Nexon saw 38.554 billion yen (~$352.6 million) in revenue from PC (down 27 percent year-over-year) and 13.803 billion yen (~$126.3 million) from mobile (down 15 percent year-over-year).

Operating income came in at 24,419 billion yen (~$223 million) for Q3, up 3 percent from last year and slightly beating Nexon’s expectations. The company notes that lower-than-planned costs and a sizable gain from its acquisition of Embark Studios are to thank, though a 2.2 billion yen (~$20.1 million) impairment loss offset gains.

For the coming quarter ending December 31 2019, Nexon expects revenue to come in between 41.4 billion yen and 44.454 billion yen (~$378.7 million - $406.7 million) for the quarter, down between 10.2 percent and 3.5 percent year-over-year, while operating income is expected to increase to between 6 billion yen and 8.2 billion yen (~$54.7 million - $75 million), up between 53 percent and 110.1 percent year-over-year.