Kakao Games swung to a loss last year as the gap in new releases and a decline in revenue from its flagship intellectual property (IP) took a toll.
Kakao Games said on the 11th that last year's revenue fell 26% year over year to 465 billion won. Operating loss came to 39.6 billion won, turning to the red. Despite intense structural reform and expense efficiencies, delays in launching new titles appear to have weighed on last year's performance. In particular, the core IP "Odin," which accounts for a large share of revenue, entered a stabilization phase with declining sales as the service aged, but the impact was amplified because supporting new titles were not released on time.
Fourth-quarter revenue was 98.9 billion won, down 26% from a year earlier. The operating loss widened to 13.1 billion won.
Kakao Games last year exited noncore businesses and reinforced its structural foundation by refocusing its strategy on its core business of "games." This year, it plans to diversify genres and accelerate platform expansion to PC/online and consoles. A company official said, "After ensuring polish and market validation for our large-scale games, we plan to target the global market from the second half to secure growth momentum."
In the first quarter, it will unveil SMiniz, a mobile casual game inspired by artists under SM Entertainment. It will then expand core IP such as "Odin" and "ArcheAge" to global platforms including PC online and consoles through the major new titles "OdinQ" and "ArcheAge Chronicle."
It also plans to sequentially reveal new titles including the strategy adventure role-playing game (RPG) "Dungeon Arise," the 2.5D massively multiplayer online role-playing game (MMORPG) "Project OQ," the open-world zombie survival simulator "God Save Birmingham," and the subculture training simulation "Project C."
Han Sang-woo, CEO of Kakao Games, said, "We plan to make visible the new titles we have been preparing, based on the restructuring we have consolidated so far," adding, "We will concentrate our capabilities on game development to expand our own IP and present well-made new titles diversified by platform, genre, and region."