Reported record sales of $405.7 million

KRAFTON, Inc. reports record sales of $405.7 million for the first quarter of 2022.

KRAFTON, Inc., developer of the battle royale game PUBG: Battlegrounds, headquartered in South Korea, today announced its preliminary results for the first quarter of 2022.

KRAFTON reported quarterly revenue of $405.7 million based on consolidated financial statements prepared in accordance with Korea’s International Financial Reporting Standard (K-IFRS). KRAFTON’s quarterly sales thus reached a record high and increased by 17.8% compared to the previous quarter and by 13.5% over the result of the same quarter of the previous year. Here are more details on the Q1 2022 results.

Summary of results for Q1 2022

• Revenue: $405.7M (+17.8% QoQ and +13.5% YoY)
• Operating Profit: $241.9M (+628% QoQ and +37% YoY)
• Net Income: $190.2 million

The increase in operating income sequentially and year-on-year is due to lower operating expenses (e.g., marketing expenses) and the elimination of one-time stock compensation costs in 2021.

Factors that contributed to quarterly growth

In the first quarter of 2022, the PUBG-IP balanced growth across all platforms. As a large number of old users returned to the game after PUBG: Battlegrounds transitioned to free-to-play (F2P) in January 2022, the average monthly active user (MAU) almost tripled compared to Q4 2021. The number of paying Users more than doubled, contributing significantly to the increase in quarterly revenue. As a result, PUBG: Battlegrounds PC sales reached $82.3 million, up 61% year-on-year. PUBG: Battlegrounds console sales were up 124% quarter-on-quarter and 274% year-on-year.

PUBG: MOBILE reported revenue of $307.1 million for the first quarter of 2022, up 30% in the previous quarter and 5% in the year-ago quarter. These increases have been fueled by a number of in-game IP collaborations and robust live service systems.

International markets (outside South Korea) contributed 95% of KRAFTON sales in Q1 2022. The company has contributed to the development of the local gaming industry in India by making strategic investments in the country’s IT and media ecosystem. Accordingly could BATTLEGROUNDS MOBILE INDIA are seeing an upward trend in market share and revenue.

New games and expanded business focus in 2022

KRAFTON will release new titles like “Project M” and “The Callisto Protocolpublish. Unknown Worlds, the creators of the subnauticaseries, which KRAFTON has acquired in 2021, are developing a new game codenamed “Project M‘, which is slated for Early Access later this year. “Project M‘ is a unique turn-based strategy game set in a sci-fi world. The Callisto Protocola survival horror game developed by Striking Distance Studios is also set to launch in 2022. In addition, internal project incubation teams have developed games based on deep learning and conducted public tests on Steam.

The company continues to work on strengthening its Web 3.0 business and establishing a joint venture with NAVER Z. A team of members dedicated to NFT research and experienced in game research and development has created a sandbox Developed an editing tool that can be used for developing games and implementing the Metaverse. The team plans to conduct an alpha test in the first quarter of 2023. As such, KRAFTON plans far-reaching efforts to build the Create to Earn (C2E) ecosystem.

Breakdown of performance in Q1 2022 compared to prior periods

▲ Table: KRAFTON’s (Preliminary) Results for 1Q22 on a Consolidated Basis (Unit: KRW100M)

For the latest information on KRAFTON, go to www.krafton.com.

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