1. GRVY reported KRW 170,740 million in Q2 revenues, up 24.2% QoQ. 2. Net profit fell 39.9% QoQ to KRW 13,245 million. 3. Online game revenues increased 16.8% QoQ driven by new releases. 4. Mobile game revenues were KRW 144,003 million, a 24.7% QoQ rise. 5. Operating expenses rose significantly due to increased advertising costs.
Despite a decline in net profit, revenue growth is strong. Historical examples show that sustained revenue growth can lead to long-term stock price appreciation for growth companies.
The significant revenue growth in both online and mobile segments alongside new product launches suggests positive momentum. Still, net profit decline may temper investor enthusiasm in the short term.
The new game launches will boost revenues in the upcoming quarter, impacting stock performance soon. Past instances indicate that initial success of new games typically correlates with stock price uplifts.
Seoul, South Korea, Aug. 08, 2025 (GLOBE NEWSWIRE) -- GRAVITY Co., Ltd. (NASDAQGM:GRVY) ("Gravity" or "Company"), a developer and publisher of online and mobile games based in South Korea, today announced its unaudited financial results for the second quarter ended June 30, 2025, prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and business updates.
SECOND QUARTER 2025 HIGHLIGHTS
REVIEW OF SECOND QUARTER 2025 FINANCIAL RESULTS
Revenues
Online game revenues for the second quarter of 2025 were KRW 21,971 million (US$ 16,233 thousand), representing a 16.8% increase QoQ from KRW 18,806 million and a 13.0% increase YoY from KRW 19,445 million. The increase QoQ was mainly attributable to initial revenue from Ragnarok Online America Latina launched in Latin America on May 28, 2025. The increase YoY was also mainly due to initial revenue from Ragnarok Online America Latina launched in Latin America on May 28, 2025.
Mobile game revenues were KRW 144,003 million (US$ 106,393 thousand) for the second quarter of 2025, representing a 24.7% increase QoQ from KRW 115,486 million and a 45.4% increase YoY from KRW 99,019 million. The increase QoQ was resulted by initial revenues from Ragnarok M: Classic launched in Taiwan, Hong Kong and Macau on April 16, 2025 and Ragnarok X: Next Generation launched in North, Central and South America, Oceania, England, Portugal, Spain and Ireland on May 8, 2025. Such increase was partially offset by decreased revenues from Ragnarok: Rebirth in Taiwan, Hong Kong and Macau, Ragnarok Origin in Southeast Asia, Taiwan, Hong Kong and Macau and THE RAGNAROK in Southeast Asia. The increase YoY was mainly due to initial revenues from Ragnarok M: Classic launched in Taiwan, Hong Kong and Macau on April 16, 2025 and Southeast Asia on February 14, 2025, increased revenue from Ragnarok Idle Adventure Plus launched in Global except Taiwan, Hong Kong, Macau, China, Korea and Japan on February 20, 2025 and initial revenue from Ragnarok X: Next Generation launched in North, Central and South America, Oceania, England, Portugal, Spain and Ireland on May 8, 2025. This increase was partially offset by decreased revenues from Ragnarok Origin in North, Central and South America and Southeast Asia.
Other revenues were KRW 4,766 million (US$ 3,521 thousand) for the second quarter of 2025, representing a 50.3% increase QoQ from KRW 3,172 million and a 5.8% increase YoY from KRW 4,503 million.
Cost of Revenue
Cost of revenue was KRW 114,006 million (US$ 84,231 thousand) for the second quarter of 2025, representing a 30.4% increase QoQ from KRW 87,458 million and a 50.0% increase YoY from KRW 76,006 million. The increase QoQ was mainly due to commission paid for mobile game services related to Ragnarok M: Classic in Taiwan, Hong Kong and Macau and Ragnarok X: Next Generation in North, Central and South America, Oceania, England, Portugal, Spain and Ireland. The increase YoY was primarily due to increased commission paid for mobile game services related to Ragnarok M: Classic in Southeast Asia, Taiwan, Hong Kong and Macau, Ragnarok Idle Adventure Plus in Global except Taiwan, Hong Kong, Macau, China, Korea and Japan and Ragnarok X: Next Generation in North, Central and South America, Oceania, England, Portugal, Spain and Ireland.
Operating Expenses
Operating expenses were KRW 37,064 million (US$ 27,383 thousand) for the second quarter of 2025, representing a 46.6% increase QoQ from KRW 25,276 million and a 15.9% increase YoY from KRW 31,972 million. The increase QoQ was mainly due to increased advertising expenses for Ragnarok Online America Latina in Latin America, Nobunaga's Ambition: The Road to the World (Tentative English Title) in Japan, Ragnarok Idle Adventure Plus in Taiwan, Hong Kong and Macau and Ragnarok: Back to Glory in Korea. The increase YoY was also mainly due to increased advertising expenses for Ragnarok Online America Latina in Latin America, Ragnarok Idle Adventure Plus in Global, Taiwan, Hong Kong and Macau, Nobunaga's Ambition: The Road to the World (Tentative English Title) in Japan and Ragnarok: Back to Glory in Korea.
Profit Before Income Tax Expense
Profit before income tax expense was KRW 18,706 million (US$ 13,821 thousand) for the second quarter of 2025 compared with profit before income tax expense of KRW 28,450 million for the first quarter of 2025 and profit before income tax expense
of KRW 20,057 million for the second quarter of 2024.
Net Profit
As a result of the foregoing factors, Gravity recorded a net profit attributable to parent company of KRW 13,245 million (US$ 9,786 thousand) for the second quarter of 2025 compared with net profit attributable to parent company of KRW 22,038 million for the first quarter of 2025 and a net profit attributable to parent company of KRW 12,569 million for the second quarter of 2024.
Liquidity
The balance of cash and cash equivalents and short-term financial instruments was KRW 576,840 million (US$ 426,184 thousand) as of June 30, 2025.
Note: For convenience purposes only, the KRW amounts have been expressed in U.S. dollars at the exchange rate of KRW 1,353.50 to US$ 1.00, the noon buying rate in effect on June 30, 2025 as quoted by the Federal Reserve Bank of New York.
GRAVITY BUSINESS UPDATES
Ragnarok Online IP-based Games
Ragnarok: The Promised Adventure (Tentative English Title, Chinese title: 仙境传说之约定好的冒险) officially received an ISBN from Chinese government on May 21, 2025 and will be launched in China on October 1, 2025.
Ragnarok X: Next Generation was officially launched in North, Central and South America, Oceania, England, Portugal, Spain and Ireland on May 8, 2025 and will be launched in Europe (except England, Portugal, Spain and Ireland), Middle East, Africa and South Asia in October 2025.
Ragnarok Online America Latina was officially launched in Latin America on May 28, 2025.
Ragnarok Idle Adventure Plus was officially launched in Taiwan, Hong Kong and Macau on May 21, 2025 and will be launched in Korea on August 28, 2025.
Poring Rush was officially launched in Korea on June 12, 2025.
Ragnarok Zero was officially launched in Taiwan, Hong Kong and Macau on July 3, 2025.
Ragnarok: Twilight was officially launched in Taiwan, Hong Kong and Macau on July 3, 2025. It will be launched in China on August 15, 2025 and is underway for its launch in Southeast Asia in the second half of 2025.
Ragnarok Crush was officially launched in Global except China and Japan on July 17, 2025.
Ragnarok V: Returns was officially launched in Global on August 7, 2025.
Ragnarok M: Classic will be launched in North and South America, Europe, Middle East and Africa on September 3, 2025.
Ragnarok: The New World is planned to be launched in Taiwan, Hong Kong and Macau in the fourth quarter of 2025.
PROJECT ABYSS is underway for its launch in Southeast Asia in the fourth quarter of 2025.
Ragnarok Libre will be launched in Global except Korea, China and Japan on August 11, 2025.
I'm the Hero of This Ragnarok! (Tentative English Title) is scheduled to be launched in Korea in September 2025.
Ragnarok Online IP-based Blockchain Game
Ragnarok Landverse will be launched in North and South America in the fourth quarter of 2025.
Other IP-based games
Gunbound was officially launched in Southeast Asia and Latin America on June 10, 2025.
Nobunaga's Ambition: The Road to the World (Tentative English Title) was officially launched in Japan on June 18, 2025.
Dragonica Origin was officially launched in Southeast Asia on July 16, 2025.
Meow Star Acres 2 will be launched in Global in the fourth quarter of 2025.
Schop Hero will be launched in Japan in the third quarter of 2025.
Chess Rumble is planned to be launched in Global except Korea and Japan in the third quarter of 2025.
Investor Presentation
Gravity issued an investor presentation. The presentation contains the Company's recent business updates, results of the second quarter in 2025 and Gravity's business plan. The presentation can be found on the Company's website under the IR Archives section at https://www.gravity.co.kr/en/ir/updates. Korean and Japanese versions of the presentation are also provided on the website.
About GRAVITY Co., Ltd. ---------------------------------------------------
Gravity is a developer and publisher of online and mobile games. Gravity's principal product, Ragnarok Online, is a popular online game in many markets, including Japan and Taiwan, and is currently commercially offered in 91 markets. For more information about Gravity, please visit http://www.gravity.co.kr.
Forward-Looking Statements:
Certain statements in this press release may include, in addition to historical information, "forward-looking statements" within the meaning of the "safe-harbor" provisions of the U.S. Private Securities Litigation Reform Act 1995. Forward-looking statements can generally be identified by the use of forward-looking terminology, such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe", "project," or "continue" or the negative thereof or other similar words, although not all forward-looking statements contain these words. Investors should consider the information contained in our submissions and filings with the United States Securities and Exchange Commission (the "SEC"), including our annual report for the fiscal year ended December 31, 2024 on Form 20-F, together with such other documents that we may submit to or file with the SEC from time to time, on Form 6-K. The forward-looking statements speak only as of this press release and we assume no duty to update them to reflect new, changing or unanticipated events or circumstances.
Contact:
Mr. Heung Gon Kim
Chief Financial Officer
Gravity Co., Ltd.
Email: kheung@gravity.co.kr
Ms. Jin Lee
Ms. Yujin Oh
IR Unit
Gravity Co., Ltd.
Email: ir@gravity.co.kr
Telephone: +82-2-2132-7800
GRAVITY Co., Ltd.
Consolidated Statements of Financial Position
(In millions of KRW and thousands of US$)
| As of | |||||||||||||||
| 31-Dec-24 | 30-Jun-25 | ||||||||||||||
| KRW | US$ | KRW | US$ | ||||||||||||
| (audited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||
| Assets | |||||||||||||||
| Current assets: | |||||||||||||||
| Cash and cash equivalents | 228,898 | 169,116 | 215,441 | 159,173 | |||||||||||
| Short-term financial instruments | 324,304 | 239,604 | 361,399 | 267,011 | |||||||||||
| Accounts receivable, net | 81,152 | 59,957 | 81,368 | 60,117 | |||||||||||
| Other receivables, net | 1,572 | 1,161 | 1,948 | 1,439 | |||||||||||
| Prepaid expenses | 8,115 | 5,996 | 17,768 | 13,127 | |||||||||||
| Other current financial assets | 6,602 | 4,878 | 4,759 | 3,516 | |||||||||||
| Other current assets | 2,967 | 2,192 | 3,975 | 2,937 | |||||||||||
| Total current assets | 653,610 | 482,904 | 686,658 | 507,320 | |||||||||||
| Property and equipment, net | 9,957 | 7,356 | 10,703 | 7,908 | |||||||||||
| Intangible assets, net | 7,057 | 5,214 | 8,941 | 6,606 | |||||||||||
| Deferred tax assets | 5,617 | 4,150 | 6,498 | 4,801 | |||||||||||
| Other non-current financial assets | 1,767 | 1,306 | 1,686 | 1,246 | |||||||||||
| Other non-current assets | 8,451 | 6,245 | 7,966 | 5,885 | |||||||||||
| Total assets | 686,459 | 507,175 | 722,452 | 533,766 | |||||||||||
| Liabilities and Equity | |||||||||||||||
| Current liabilities: | |||||||||||||||
| Accounts payable | 67,930 | 50,188 | 82,024 | 60,601 | |||||||||||
| Deferred revenue | 26,761 | 19,772 | 20,868 | 15,418 | |||||||||||
| Withholdings | 1,588 | 1,173 | 1,599 | 1,181 | |||||||||||
| Accrued expense | 2,651 | 1,959 | 2,181 | 1,611 | |||||||||||
| Income tax payable | 6,507 | 4,808 | 7,667 | 5,665 | |||||||||||
| Other current liabilities | 3,212 | 2,373 | 3,653 | 2,699 | |||||||||||
| Total current liabilities | 108,649 | 80,273 | 117,992 | 87,175 | |||||||||||
| Long-term account payables | 220 | 163 | 623 | 460 | |||||||||||
| Long-term deferred revenue | 2,572 | 1,900 | 880 | 650 | |||||||||||
| Other non-current liabilities | 5,361 | 3,961 | 5,262 | 3,889 | |||||||||||
| Deferred tax liabilities | 1,294 | 956 | 1,290 | 953 | |||||||||||
| Total liabilities | 118,096 | 87,253 | 126,047 | 93,127 | |||||||||||
| Share capital | 3,474 | 2,567 | 3,474 | 2,567 | |||||||||||
| Capital surplus | 26,979 | 19,933 | 26,979 | 19,933 | |||||||||||
| Other components of equity | 23,801 | 17,585 | 16,601 | 12,265 | |||||||||||
| Retained earnings | 513,418 | 379,326 | 548,701 | 405,394 | |||||||||||
| Equity attributable to owners of the Parent Company | 567,672 | 419,411 | 595,755 | 440,159 | |||||||||||
| Non-controlling interest | 691 | 511 | 650 | 480 | |||||||||||
| Total equity | 568,363 | 419,922 | 596,405 | 440,639 | |||||||||||
| Total liabilities and equity | 686,459 | 507,175 | 722,452 | 533,766 | |||||||||||
* For convenience purposes only, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,353.50 to US$ 1.00, the noon buying rate in effect on June 30, 2025 as quoted by the Federal Reserve Bank of New York.
GRAVITY Co., Ltd.
Consolidated Statements of Comprehensive Income
(In millions of KRW and thousands of US$ except for share and ADS data)
| Three months ended | Six months ended | ||||||||||||||||||||
| 31-Mar-25 | 30-Jun-24 | 30-Jun-25 | 30-Jun-24 | 30-Jun-25 | |||||||||||||||||
| (KRW) | (KRW) | (KRW) | (US$) | (KRW) | (KRW) | (US$) | |||||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||
| Revenues: | |||||||||||||||||||||
| Online games | 18,806 | 19,445 | 21,971 | 16,233 | 37,510 | 40,777 | 30,127 | ||||||||||||||
| Mobile games | 115,486 | 99,019 | 144,003 | 106,393 | 197,567 | 259,489 | 191,717 | ||||||||||||||
| Other revenue | 3,172 | 4,503 | 4,766 | 3,521 | 7,669 | 7,938 | 5,865 | ||||||||||||||
| Total net revenue | 137,464 | 122,967 | 170,740 | 126,147 | 242,746 | 308,204 | 227,709 | ||||||||||||||
| Cost of revenue | 87,458 | 76,006 | 114,006 | 84,231 | 149,634 | 201,464 | 148,847 | ||||||||||||||
| Gross profit | 50,006 | 46,961 | 56,734 | 41,916 | 93,112 | 106,740 | 78,862 | ||||||||||||||
| Operating expenses: | |||||||||||||||||||||
| Selling, general and administrative expenses | 21,859 | 28,108 | 33,509 | 24,757 | 43,855 | 55,368 | 40,907 | ||||||||||||||
| Research and development | 3,431 | 4,286 | 3,291 | 2,431 | 7,887 | 6,722 | 4,966 | ||||||||||||||
| Others, net | (14) | (422) | 264 | 195 | (488) | 250 | 185 | ||||||||||||||
| Total operating expenses | 25,276 | 31,972 | 37,064 | 27,383 | 51,254 | 62,340 | 46,058 | ||||||||||||||
| Operating profit | 24,730 | 14,989 | 19,670 | 14,533 | 41,858 | 44,400 | 32,804 | ||||||||||||||
| Finance income(costs): | |||||||||||||||||||||
| Finance income | 10,717 | 8,867 | 2,651 | 1,959 | 15,164 | 13,368 | 9,877 | ||||||||||||||
| Finance costs | (6,997) | (3,799) | (3,615) | (2,671) | (4,467) | (10,612) | (7,840) | ||||||||||||||
| Profit before income tax | 28,450 | 20,057 | 18,706 | 13,821 | 52,555 | 47,156 | 34,841 | ||||||||||||||
| Income tax expense | 6,372 | 7,476 | 5,486 | 4,053 | 13,091 | 11,858 | 8,761 | ||||||||||||||
| Profit for the year | 22,078 | 12,581 | 13,220 | 9,768 | 39,464 | 35,298 | 26,080 | ||||||||||||||
| Profit attributable to: | |||||||||||||||||||||
| Non-controlling interest | 40 | 12 | (25) | (18) | 29 | 15 | 12 | ||||||||||||||
| Owners of Parent company | 22,038 | 12,569 | 13,245 | 9,786 | 39,435 | 35,283 | 26,068 | ||||||||||||||
| Earnings per share | |||||||||||||||||||||
| - Basic and diluted | 3,171 | 1,809 | 1,906 | 1.41 | 5,675 | 5,077 | 3.75 | ||||||||||||||
| Weighted average number of shares outstanding | |||||||||||||||||||||
| - Basic and diluted | 6,948,900 | 6,948,900 | 6,948,900 | 6,948,900 | 6,948,900 | 6,948,900 | 6,948,900 | ||||||||||||||
| Earnings per ADS | |||||||||||||||||||||
| - Basic and diluted | 3,171 | 1,809 | 1,906 | 1.41 | 5,675 | 5,077 | 3.75 | ||||||||||||||
* For convenience, the KRW amounts are expressed in U.S. dollars at the rate of KRW 1,353.50 to US$1.00, the noon buying rate in effect on June 30, 2025 as quoted by the Federal Reserve Bank of New York.
(1) Each ADS represents one common share.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| GRAVITY CO., LTD. | ||
| By: | /s/ Heung Gon Kim | |
| Name: | Heung Gon Kim | |
| Title: | Chief Financial Officer | |
Date: August 8, 2025
