Mirae Asset Securities said on the 6th that Netmarble's profitability is expected to improve thanks to Google's app fee cut policy. It kept its investment rating on Netmarble at "Buy" and raised the target price to 85,000 won from 80,000 won. Netmarble's closing price in the previous trading day was 48,500 won.
Lim Hui-seok, an analyst at Mirae Asset Securities, said, "Among domestic game companies, Netmarble has the largest amount of fees paid to Google, more than 90% of its revenue comes from mobile, and over 70% from in-app payments," adding, "Netmarble's profit will increase the most thanks to Google's fee cut."
Google said on the 4th that it will introduce a policy to lower in-app payment fees to 20% from up to 30%. The new fee policy will be applied starting in June this year in the United States, the European Union (EU), and the United Kingdom, followed by Australia in September, and Korea and Japan in December. Since launching the Android Market in 2008, Google has effectively kept app fees at 30%.
Mirae Asset Securities estimated that fee savings from Google's new app fee policy change will reach 30 billion won this year and 100 billion won next year. It also said the share of proprietary payments will expand rapidly to 31% this year and 41% next year, following 19% last year. It expected the fee-out ratio to gradually decrease from 33.1% last year to 29.2% this year and 25.1% next year.
Lim said, "We judge there is a high possibility that Apple (iOS) app fees will also be cut swiftly within the year," adding, "If app fees in the remaining regions are cut to 17%, as in the EU region, Netmarble's operating profit in 2027 could see an additional improvement of around 100 billion won."