Corporate Logo(source: krafton.com)
KB Securities analyzed on March 13 that Krafton(259960) is alleviating concerns regarding a potential peak-out for PUBG. The firm maintained its "BUY" rating and a target price of 450,000 won.
In the fourth quarter of last year, Krafton reported consolidated revenues of 617.6 billion won and operating profit of 215.5 billion won, marking year-on-year increases of 15.5% and 31.1%, respectively. Lee Sun-hwa, an analyst at KB Securities noted, "The operating profit fell short of consensus expectations of 263 billion won by 18.1%."
However, the firm expects a recovery in earnings starting in the first quarter of this year. Lee explained, "While sales of Hwangpyeongjeongyeong were sluggish in Q4, combined revenues in January and February of 2025, boosted by the Lunar New Year event and the release of the Rondo Map, increased by 34.1% year-on-year."
Lee also mentioned that most of the investments related to new games will likely be in labor costs, adding, "Although Krafton plans to hire 500 people this year, around 50 people will be hired in Q1. The number of hires and the amount of investment in new intellectual properties(IP) are expected to gradually increase, which should result in better-than-expected performance in Q1."
In addition, Lee expects concerns over PUBG to be alleviated. Lee stated, "After the release of the Rondo Map update in Q4 of 2023, PUBG's user retention strengthened, leading to a 61.3% year-on-year increase in PC sales last year. Despite concerns about PUBG's growth in 2025 due to high comparatives, these worries were dismissed when the game reached about 830,000 concurrent players on Steam on February 23."
Lee further added, "There is plenty of momentum ahead, with the transition to Unreal Engine 5, the launch of the AI-powered CPC Ally, and the introduction of a UGC mode. As PUBG players have more content to enjoy, the game's playtime retention metrics are expected to continue improving."
*[KOSPI]Krafton(259960) is a global game company engaged in game development and publishing business, servicing 21 games including <Battleground>, <New State Mobile>, and <Subnautica>. The market capitalization is 16 trillion 552.3 billion won(as of March 12, 2025, closing price).
Corporate Logo(source: krafton.com)
KB Securities analyzed on March 13 that Krafton(259960) is alleviating concerns regarding a potential peak-out for PUBG. The firm maintained its "BUY" rating and a target price of 450,000 won.
In the fourth quarter of last year, Krafton reported consolidated revenues of 617.6 billion won and operating profit of 215.5 billion won, marking year-on-year increases of 15.5% and 31.1%, respectively. Lee Sun-hwa, an analyst at KB Securities noted, "The operating profit fell short of consensus expectations of 263 billion won by 18.1%."
However, the firm expects a recovery in earnings starting in the first quarter of this year. Lee explained, "While sales of Hwangpyeongjeongyeong were sluggish in Q4, combined revenues in January and February of 2025, boosted by the Lunar New Year event and the release of the Rondo Map, increased by 34.1% year-on-year."
Lee also mentioned that most of the investments related to new games will likely be in labor costs, adding, "Although Krafton plans to hire 500 people this year, around 50 people will be hired in Q1. The number of hires and the amount of investment in new intellectual properties(IP) are expected to gradually increase, which should result in better-than-expected performance in Q1."
In addition, Lee expects concerns over PUBG to be alleviated. Lee stated, "After the release of the Rondo Map update in Q4 of 2023, PUBG's user retention strengthened, leading to a 61.3% year-on-year increase in PC sales last year. Despite concerns about PUBG's growth in 2025 due to high comparatives, these worries were dismissed when the game reached about 830,000 concurrent players on Steam on February 23."
Lee further added, "There is plenty of momentum ahead, with the transition to Unreal Engine 5, the launch of the AI-powered CPC Ally, and the introduction of a UGC mode. As PUBG players have more content to enjoy, the game's playtime retention metrics are expected to continue improving."
*[KOSPI]Krafton(259960) is a global game company engaged in game development and publishing business, servicing 21 games including <Battleground>, <New State Mobile>, and <Subnautica>. The market capitalization is 16 trillion 552.3 billion won(as of March 12, 2025, closing price).