Nexon said it will continue an expansion strategy centered on long-running intellectual property (IP) such as MapleStory and DUNGEON & FIGHTER. The plan is to wind down low-profitability projects and focus on projects with a higher chance of success and on investment in core IP.
Patrick Söderlund, chair of Nexon's Japan subsidiary, stated accordingly at a capital markets briefing (CMB) in Tokyo on the 31st, saying, "We will boldly scale back projects that have no answer." At the event, Söderlund, who oversees companywide strategy and creative direction, and CEO Lee Jeong-heon, who is responsible for the operation of live services and day-to-day management of the company, each presented Nexon's future vision based on their roles.
Söderlund said that although Nexon posted an all-time high in sales last year (4.5 trillion won), expense, including labor costs, increased at a faster pace, making it harder to achieve the goal of "7 trillion won in sales by 2027."
"At the time, we were confident that strong franchise performance and an expanded pipeline of new titles would translate into profitability, but DUNGEON & FIGHTER Mobile suffered structural weakness on the sales side, and the launch of new titles was delayed," he said, adding, "Along with portfolio expansion, expense increased faster than sales."
While emphasizing the value and competitiveness of Nexon's flagship IP that have grown with users for more than 20 years, such as "MapleStory" and "DUNGEON & FIGHTER," Söderlund also assessed that structural reforms are needed for sustainable growth. "Going forward, every portfolio will be restructured after a clear review of business viability," he said, adding, "We have selected projects that can meet or exceed the newly established profit floor by reviewing the entire portfolio."
He also declared that the company will establish a faster and bolder decision-making structure to accelerate the pace of change. "Nexon has been excessively slow in making tough decisions," he said, adding, "Rather than expense cuts, we will reduce projects that have no answer through rerouting of the structure, and we will not approve headcount increases that are not directly related." This means the company will closely reexamine its existing cost structure and concentrate resources on core areas such as game development.
However, he stressed that restructuring does not mean layoffs or downsizing. Söderlund said, "Layoffs are not in the plan at all."
Addressing the early-year probability controversy related to "Maple Idle," he noted it was "a clear operational management failure." "The code error was neither reported to management nor notified to users," he said. "The financial burden from refund measures was heavy, but the bigger issue was the damage to trust." He said the company swiftly implemented measures to prevent a recurrence by carrying out structural reforms such as appointing a new chief risk officer (CRO) and introducing a mandatory multi-reporting system.
Söderlund is the founder and CEO of Embark Studios, Nexon's Sweden-based subsidiary that made the hit "ARC Raiders," which has sold 14 million copies since its launch in the second half of last year. Before founding Embark, he served as executive vice president at Electronic Arts Inc., where he led development of the "Battlefield" series.
"ARC Raiders was produced with far fewer people and expense than a typical AAA game," Söderlund said. "This success was not a coincidence but an intended outcome, and we want to apply that mindset across Nexon."
On Nexon's differentiator in artificial intelligence (AI), he evaluated that the vast experience accumulated over the past 30 years is not a mere databases but "context," a unique competitive edge and asset. He added that Nexon's AI will strive to leverage this vast and deep "context" quickly and at massive scale.
He cited a "powerful community," akin to the fandom of famous sports teams, as Nexon's greatest asset. Söderlund emphasized that every future portfolio decision or new investment will be made based on a single essential question: "Can this become a lifelong passion for users?" Only when there is confidence in the answer to this question will the company focus all its capabilities, and it will turn away from opportunities that do not meet this bar, he said.
At the event, CEO Lee introduced a growth strategy focused on core IP, including the three major Nexon franchises "MapleStory," "DUNGEON & FIGHTER," and "FC Online," as well as "Mabinogi," "ARC Raiders," and "NAKWON: LAST PARADISE" (hereafter NAKWON).
For the "MapleStory" franchise, overall sales grew 43% year over year, and about 40% of sales come from outside Korea, in global markets. Lee said the company will actively transplant MapleStory's success formula to other key franchises such as DUNGEON & FIGHTER.
Within the year, Nexon will launch "DUNGEON & FIGHTER Idle," and next year it will expand the DUNGEON & FIGHTER IP's reach by unveiling new titles such as "DUNGEON & FIGHTER Classic," which reinterprets the franchise's golden age in a modern way, "DUNGEON & FIGHTER: Arad," and "Project Overkill."
The company will also focus on developing new titles such as "Vindictus: Defying Fate," a new entry in the "Mabinogi" IP, Embark Studios' new project, and "NAKWON: LAST PARADISE," slated for release next year.
Lee also introduced "Monolake," Nexon's AI initiative. Monolake is a companywide AI infrastructure that maximizes development efficiency through AI with access to the massive game development and service data Nexon has accumulated over decades. "AI without context is just speed; it merely produces generic outputs quickly," Lee said, adding, "We will not use AI to replace creators, but will enable top talent to spend more time on context-based creative decision-making."
Lastly, Chief Financial Officer (CFO) Shiro Uemura wrapped up the event by announcing a plan to maximize shareholder value through "principled investment" and "consistent capital return," based on more than 800 billion yen in cash-like asset and stable cash generation capability.
Nexon expects concurrent growth in sales and operating profit this year through strict expense control and resource reallocation, and plans to build a long-term, sustainable growth model through structural profitability improvements.
It will also strengthen shareholder return policies. The company plans an annual dividends of 60 yen per share this year, up 33% from last year.