Nexon

Basic Information

Stock Code
3659
Industry
Information and Communications
Category Detail
Content Production & Distribution
Prefecture
Tokyo
Establishment Year
December 2002
Listing Year
December 2011
Official Website
https://company.nexon.co.jp/
TSE Information
TSE Information
Yahoo! Finance
Yahoo! Finance
Other Companies
DeNA, GREE Holdings, Colopl, GunHo Online Entertainment, gumi, Akatsuki, HEROZ, Bank of Innovation, Bandai Namco Holdings, Marvelous, Konami Holdings

Overview

Nexon is a major online game development and service company established in 2002, deploying popular games in over 190 countries worldwide with a cumulative registered user base exceeding 1 billion, making it a global leader.

Current Situation

Nexon maintained high profitability in 2022 with consolidated revenue of 353.7 billion yen, operating income of 140.5 billion yen, and net income of 100.3 billion yen. It operates not only in Japan but also in Korea, the United States, Taiwan, Thailand, and other regions, delivering a variety of popular game titles. The company is focusing on strengthening existing titles and developing new ones while expanding its own IPs. It is also diversifying into the entertainment sector through massive investments in film production companies. Having adopted the item-based monetization model early on, it has built a stable revenue base. It has strengthened local expansion through the acquisition of Gloops, Inc. and multiple overseas subsidiaries. While there are operational risks such as impairment losses on cryptocurrencies, it is focusing on the growth of the global game market and the utilization of new technologies, pursuing strategic growth toward 2030. It maintains high-quality game development capabilities through partnerships with diverse content development studios and has e-sports and new genres in its sights. It is also actively working to improve brand recognition both domestically and internationally.

Trivia

Interesting Facts

  • Founded in Korea in 1994 and relocated headquarters to Japan in 2005.
  • Global company with cumulative registered users reaching approx. 1 billion.
  • Pioneer in the game industry for early introduction of item-based monetization.
  • Deploys numerous renowned game IPs simultaneously.
  • Only game company to make a massive investment in the Avengers production company.
  • Constituent of Nikkei 225 and JPX-Nikkei 400 Index in Japan.
  • Founder resigned as director due to past indictment by Korean prosecutors.
  • Actively entering e-sports market and operating tournaments.
  • Possesses multinational development teams capable of multilingual support.
  • Emphasizing broad media deployments including TV CMs and anime.
  • Strength in owning some of the industry's largest development studio groups.
  • Active investments in film and entertainment beyond online games.
  • Maintains high standards in secure management of various online payments.
  • Expanding market share with games compatible across diverse platforms.
  • High user retention through focus on in-game community activation.

Hidden Connections

  • Overseas subsidiaries centered in Korea and the US form the pillar of global strategy.
  • Became the lead shareholder of film company AGBO, strengthening game IP video expansions.
  • Headquarters in Ark Hills South Tower, Roppongi, Tokyo, serving as a hub for multinational companies.
  • Representative Director and President Owen Mah, Korean-born, symbolizes international management.
  • Significantly contributed to the普及 of item-based monetization models in the game industry.
  • Transparent disclosure of financial fluctuation risks from cryptocurrency holdings in company announcements.
  • Experience as sponsor of sports team uniforms, building relations with local communities.
  • Actively deploying CMs as sponsor of popular Nippon TV series programs.

Future Outlook

Growth Drivers

  • Responding to sustained growth and diversification of the global game market.
  • Expansion of mobile game demand due to smartphone proliferation.
  • Market activation through e-sports and live events.
  • Creating new game experiences via AI and cloud technologies.
  • Strengthening revenue base through IP multifaceted expansions.
  • Developing new business models utilizing cryptocurrency and NFT technologies.
  • Expanding user base in Asia and emerging markets.
  • Brand strengthening and new customer acquisition through new IP development.
  • Increasing customer touchpoints with multi-platform compatibility.
  • Enhancing brand value through sustainability-focused corporate activities.
  • Stable management through thorough international regulatory compliance.
  • Long-term growth support via nurturing of next-generation game developers.

Strategic Goals

  • Achieve 1.5 billion active users worldwide.
  • Increase global revenue ratio to over 70%.
  • Achieve 30% reduction in CO2 emissions as sustainability target.
  • Expand revenue ratio from IP-utilizing video/media business to 20%.
  • Standardize AI and cloud tech introduction in all game development.
  • Host e-sports events in over 20 locations worldwide.
  • Acquire new subsidiaries and brands through aggressive M&A.
  • Cultivate 30% of industry talent through game education and training programs.
  • Strengthen multilingual and multicultural responsiveness to industry top level.
  • Achieve industry-leading cybersecurity measures.

Business Segments

Game Development Outsourcing

Overview
Undertaking planning and development of other companies' games and providing technology and know-how.
Competitiveness
High development capabilities and smooth operational collaboration through multinational teams
Customers
  • Domestic and international game publishers
  • Mobile game developers
  • Online platform operators
  • Advertising agencies
  • Entertainment companies
Products
  • Game content planning
  • Programming
  • 3D modeling and animation
  • Sound production
  • Server infrastructure setup

Platform Services

Overview
Providing various platform services necessary for game operations.
Competitiveness
Stable system operations and robust security measures
Customers
  • Game operators
  • Payment processors
  • Advertisers
  • Data analytics companies
  • Cloud service providers
Products
  • User management systems
  • Payment solutions
  • Ad delivery platforms
  • Usage statistics analysis
  • Security monitoring services

IP and Media Expansion

Overview
Diversifying revenue through multifaceted expansion of popular game IPs.
Competitiveness
Powerful IPs and expansion strategy through overseas entertainment investments
Customers
  • Film production companies
  • TV stations
  • Ad production companies
  • Marketing agencies
  • Merchandise manufacturers
Products
  • IP licensing
  • Media collaboration planning
  • Brand management
  • Ad campaign planning
  • Character product development

Services for Overseas Markets

Overview
Promoting overseas services that support multinational game deployments.
Competitiveness
Flexible responsiveness tailored to market characteristics in each country
Customers
  • Overseas major game companies
  • Local partner companies
  • Global platform operators
  • Multilingual localization providers
  • International marketing companies
Products
  • Game localization
  • Local operation support
  • Global marketing
  • Legal and regulatory compliance support
  • Multilingual community management

Technology Development and Research

Overview
Building game development environments incorporating cutting-edge technologies.
Competitiveness
R&D framework spanning diverse technology areas
Customers
  • Internal development teams
  • External contractors
  • Academic institutions
  • Tech ventures
  • Government research organizations
Products
  • AI-utilizing game design
  • Graphics technology development
  • Cryptocurrency integration technology
  • Big data analysis
  • UX/UI design

Advertising and Event Planning and Operations

Overview
Offering advertising and event services to enhance brand value and strengthen user touchpoints.
Competitiveness
High draw power and planning capabilities utilizing IPs
Customers
  • Advertising agencies
  • Event planning companies
  • Game user communities
  • Manufacturers and brand companies
  • Media companies
Products
  • In-game ad deployments
  • E-sports tournament operations
  • Promotion planning
  • Live streaming production
  • Character show planning

Payment and Monetization System Provision

Overview
Providing stable and secure online payment systems.
Competitiveness
Reliability backed by long years of monetization business operations
Customers
  • Game operators
  • Online service companies
  • Mobile carriers
  • Payment proxy services
  • Financial institutions
Products
  • Item monetization systems
  • Subscription management
  • Points management services
  • Fraud detection systems
  • Multi-currency payment support

Cloud Gaming Services

Overview
Focusing on technology development and provision of next-generation game delivery services.
Competitiveness
Powerful infrastructure and technological prowess
Customers
  • Game publishers
  • Telecom carriers
  • Device manufacturers
  • Entertainment platforms
  • End users
Products
  • Cloud game delivery platforms
  • Game streaming technology
  • Low-latency network solutions
  • Multi-device support
  • Server load balancing

Digital Content Sales

Overview
Diversifying revenue through diverse digital content sales.
Competitiveness
Large customer base and market understanding
Customers
  • PC and mobile users
  • Game-related companies
  • Distribution platforms
  • Advertising agencies
  • Media companies
Products
  • In-game item sales
  • Digital goods sales
  • Paid expansion content
  • Subscription services
  • Digital gift cards

Education and Training Services

Overview
Multifaceted deployment of education and training services for the game industry.
Competitiveness
Provision of cutting-edge industry technology and know-how
Customers
  • Game developers
  • Schools and vocational schools
  • Training companies
  • Corporate IT departments
  • Creator communities
Products
  • Game development training programs
  • Programming education
  • Creative workshops
  • Technical seminars
  • Career support services

Marketing & Data Analytics Services

Overview
Conducting advanced marketing support utilizing vast game usage data.
Competitiveness
Proprietary game data analysis capabilities
Customers
  • Advertising agencies
  • Game operators
  • Digital media
  • Research companies
  • Consulting firms
Products
  • User data analysis
  • Ad effectiveness measurement
  • Market research reports
  • User behavior analysis
  • Campaign optimization tools

VR/AR Related Business

Overview
Promoting development of VR/AR games and application content utilizing new technologies.
Competitiveness
Innovative technology and design capabilities
Customers
  • Game development companies
  • Corporate training departments
  • Medical institutions
  • Entertainment facilities
  • Educational institutions
Products
  • VR game development
  • AR content production
  • Hardware integration software
  • Simulation systems
  • Interactive experiences

Competitive Advantage

Strengths

  • Numerous popular game IPs deployed globally
  • Stable revenue from early adoption of item-based monetization model
  • Development capabilities with multinational and diverse studios
  • Strong brand power and large user base
  • Broad product lineup across various game genres
  • Market expansion achieved through active overseas subsidiaries
  • Aggressive investments and diversification strategy in entertainment
  • Ongoing efforts to introduce advanced technologies
  • Robust platform service infrastructure
  • Diverse monetization systems and payment infrastructure
  • Superior marketing and user data analytics capabilities
  • Distribution network to over 190 countries worldwide
  • Security guarantees through advanced technology
  • Initiatives toward the e-sports market
  • Rich IP assets and brand collaboration expansions

Competitive Advantages

  • Competitive edge secured through development capabilities in diverse game genres
  • Stable revenue ensured by success in item-based monetization
  • Ability to meet regional needs via global network
  • Diverse market deployment through subsidiaries and partners
  • Strengthened IP strategy via large-scale investment in film production company
  • Long-term brand nurturing and user community strengthening
  • Trust building through robust platforms and payment infrastructure
  • Differentiation via enhanced game experiences using latest technologies
  • Comprehensive multilingual localization and local operation support
  • Precise customer engagement through marketing data analysis
  • Increased user touchpoints via e-sports and live events
  • Maintaining leadership through aggressive investments in new tech (VR/AR, cloud)
  • Product and service lineup accommodating broad customer segments
  • Deployment strength across diverse platforms (PC, mobile)
  • Securing powerful developer community and talent resources

Threats

  • Intensifying competition in the global market
  • Risks in developing new IPs
  • Impairment losses from fluctuations in financial assets like cryptocurrencies
  • Market risks from changes in game user preferences
  • Business impacts from regulatory tightening and legal changes in various countries
  • Risks of lagging behind rapid technological innovations
  • Declining profitability in freemium models
  • Potential cybersecurity breaches
  • Revenue instability from exchange rate fluctuations
  • Risks of content obsolescence and brand deterioration
  • Decline in popularity of major game titles
  • Operational risks from differences in regional management systems

Innovations

2024: Global launch of HIT: The World

Overview
Launched new MMORPG 'HIT: The World' for Japan and overseas markets.
Impact
Contributes to acquiring new users and increasing revenue.

2023: Joint venture with Wonder HD to advance Mabinogi Mobile development

Overview
Improving productivity in mobile Mabinogi development through collaboration with external company.
Impact
Achieved development efficiency and faster market entry.

2022: Major investment in AGBO film production company

Overview
Invested approx. 56 billion yen in the company of Avengers directors, acquiring 38% stake.
Impact
Promoted expansion of IPs into entertainment and revenue diversification.

2021: Expansion of cloud gaming business

Overview
Strengthened technology development for next-generation cloud game delivery services.
Impact
Enhanced competitiveness in preparation for future market share.

2020: Strengthening global IP strategy

Overview
Promoting multifaceted IP licensing expansions utilizing multinational subsidiaries.
Impact
Stabilized revenue base and enhanced brand value.

2024: AI utilization for game experience enhancement technology development

Overview
Implemented player behavior analysis and advanced game scenario generation using AI.
Impact
Contributes to improving user satisfaction and session times.

2023: Advanced multilingual localization technology

Overview
Built system combining machine translation and specialist staff for quality improvement.
Impact
Expanded international markets and improved local customer satisfaction.

2022: Enhanced and diversified payment systems

Overview
Improved safety and convenience with multi-currency support and fraud prevention.
Impact
Contributed to stabilizing global monetization revenue.

2021: Initiation of VR/AR technology proof-of-concept experiments

Overview
Commenced development of new game content using VR/AR.
Impact
Aiming for first-mover advantages in future markets.

2020: Expansion of e-sports tournament operations

Overview
Planning and operating large-scale e-sports events domestically and internationally.
Impact
Activated communities and enhanced brand value.

Sustainability

  • Promoting reduction of environmental impact in game development
  • Advancing diversity and establishing inclusive workplaces
  • Strengthening corporate ethics and legal compliance
  • Supporting local communities and disaster relief activities
  • Campaigns to promote healthy game play among users
  • Establishing standards for sustainable digital content development
  • Promoting SDGs education in employee training
  • Environmental contributions through plastic reduction and digital distribution
  • Advanced cybersecurity measures
  • CO2 emission reductions through remote work promotion