NCsoft has started looking for a recovery in the second half of the year. Amid increasing concerns about its second-quarter performance, the company is striving for improved results through the release of the new game ‘Hoyeon’ and the global launch of ‘Throne and Liberty (TL)’. The upcoming release of ‘Blade & Soul 2’ in China is also a hopeful factor.
In August, NCsoft will release the new mobile game ‘Hoyeon’ in the Korean, Japanese, and Taiwanese markets on August 28. It is a character collection RPG utilizing the intellectual property of ‘Blade & Soul’. With a focus on PvE content, various boss monsters with gimmicks and patterns, five-character combinations, and hero-level and equipment sharing, it is a new genre challenge for NCsoft, which has been centered on MMORPGs. The adoption of an anime-style visual to suit the genre’s characteristics is also drawing attention. NCsoft is currently conducting pre-registration and actively recruiting users.
In September, the global service for ‘TL’ is also scheduled. Along with Amazon Games, it plans to expand its reach to North America, Europe, Australia, New Zealand, Japan, and other Western regions on September 17. It will support not only the PC gaming distribution platform ‘Steam’ but also console platforms such as PlayStation 5, Xbox Series S·X. To cater to global services, it will provide subtitles in English, Spanish, French, German, and Japanese, as well as voiceovers in English, German, Japanese, and Korean. NCsoft plans to conduct final checks through an open beta test from the 18th to the 23rd.
NCsoft is also preparing for the launch of ‘Blade & Soul 2’ service in China in collaboration with Tencent. It received a ‘foreign license’ for local distribution in China in December last year and started pre-registration locally in April. Local testing was also conducted in May.
There is currently widespread concern about NCsoft’s recent business activities. Several securities firms, including SK Securities, KB Securities, Daishin Securities, and Hanwha Investment & Securities, have pointed out the possibility of an operating loss in the second quarter. While some firms forecasted a profit, the scale of operating profit is not significant. Factors such as weakening appeal of the existing main genre MMORPG in the domestic market, increase in one-time labor costs due to workforce reduction, and pre-marketing for new releases have been cited. The effects of the 7th-anniversary event of ‘Lineage M’ are expected to be mostly reflected in the third quarter.
Market expectations for the games scheduled for release in the second half of the year are somewhat low. Following the online showcase of ‘Hoyeon’, there have been negative opinions regarding its alignment with NCsoft’s existing business direction. Similarly, ‘TL’ is not seen as having high potential for large-scale success due to its underperformance in the domestic market. There are also analyses suggesting that the highly anticipated release of ‘Aion 2’ next year will provide substantial momentum.
In relation to this, Kim Ji-hyun, a researcher at Heungkuk Securities, stated, “There is no work in the second half of this year that is highly anticipated,” while also noting the need to pay attention to whether ‘Hoyeon’, which contains the narrative of the hit IP ‘Blade & Soul’, will unexpectedly achieve results. He added, “The Chinese release of ‘Blade & Soul 2’ and the global launch of ‘TL’ will partially support the company’s operating profit strength,” and believes that the decrease in fixed labor costs will help maintain the company’s operating profit strength even in a year awaiting the release momentum of ‘Aion 2’. Heungkuk Securities raised NCsoft’s target stock price to 250,000 won and maintained a ‘buy’ investment stance.