Date: Tuesday, August 11, 2026
Attendees: Park Byung-moo (Co-CEO), Hong Won-jun (CFO), Annel Cheman (Head of Mobile Casual Center)
Agenda: NC Q2 2026 Earnings and Future Strategy

■ Summary of NC Q2 2026 Earnings and Status

▣ Q2 2026 Earnings Summary

- Q2 2026 Revenue: KRW 770.5 billion (+101% YoY, +38% QoQ)

- Operating Profit: KRW 173.9 billion (+1053% YoY, +53% QoQ)

- Pre-tax Profit: KRW 176.7 billion (Turned to profit YoY, -6% QoQ)

- Net Profit: KRW 131.2 billion (Turned to profit YoY, -14% QoQ)

- Mobile Revenue: KRW 185.3 billion (up 1% QoQ)

ㄴ Lineage M Revenue: KRW 117.3 billion (up 4% QoQ)

- PC Revenue: KRW 343.8 billion (up 8% QoQ)

ㄴ Record-high quarterly revenue for two consecutive quarters

ㄴ Prolonged success of Lineage Classic and 9x YoY growth in PC Lineage revenue

- Mobile Casual Revenue: KRW 169.7 billion

ㄴ JustPlay consolidated for the first time

ㄴ Accounts for 22% of total revenue, contributing to mid-to-long-term growth base expansion

- Revenue breakdown by region: Korea 48%, Asia 25%, North America/Europe 27%

▣ Q2 2026 Expense Summary

- Q2 2026 Operating Expenses: KRW 596.6 billion (+62% YoY, +34% QoQ)

- Labor Costs: KRW 260 billion (+36% YoY, +7% QoQ)

ㄴ Pre-emptive reflection of performance bonuses

ㄴ Consolidation of JustPlay

- Marketing Expenses: KRW 163.1 billion (+598% YoY, +332% QoQ)

ㄴ Marketing expenses for existing business: KRW 31.1 billion

ㄴ Marketing expenses for mobile casual business: KRW 132 billion

▣ Remarks by CFO Hong Won-jun

I believe we have achieved remarkable changes in revenue growth and profitability management. These results are significant as they demonstrate that NC's new management strategy is translating into actual performance. Our core game business is building a diversified portfolio that does not rely on the success of a single IP. As the value of our legacy IPs continues to be re-evaluated and expanded, we have also secured a lineup of new IPs that will upgrade our fundamental game competitiveness.

For third-party publishing games, we are preparing for global market entry after rigorous testing to fill the gap left by existing AAA games with long development cycles. Ultimately, I want to emphasize that our pipeline is shifting toward a structure that secures a competitive advantage in the global market over the mid-to-long term.

The mobile casual business reported its first full quarter of consolidated earnings. Showing growth far steeper than expected, it accounted for over 20% of NC's total revenue this quarter, firmly establishing itself as a new growth pillar. We plan to execute strategies for platform advancement and full-scale growth for JustPlay in the long term.

In conclusion, I believe 2026 will be the first year we enter a trajectory of full-scale high growth. Starting next year, as the performance of new global titles is reflected and the advancement of the mobile casual business unfolds, we expect to reach a new turning point in terms of scale and competitiveness.

▣ Remarks by Co-CEO Park Byung-moo

These results demonstrate the consolidation of existing IPs, the success of new IPs, and the foundation of new businesses through numbers. We place great significance on having established a basis for continuous, predictable growth. In the second half of this year and in 2027, high growth will continue in the mobile casual sector, and starting with the global launch of Aion 2, about 10 new IPs will be released, alongside regional expansions of existing games. We are confident in even greater growth next year.

Revenue from new games released in 2027 will be fully reflected throughout 2028 and 2029. Additionally, we have 3-4 unannounced blockbuster games in preparation for 2028-2029. We previously mentioned a KRW 5 trillion revenue target for 2030, and as management, we will strive to achieve this sooner.

■ Q&A

What is the background of the mobile casual growth and its competitiveness against other platforms? What is the AI growth strategy for the platform business?

Annel Cheman = Looking at the growth trend, JustPlay is expected to continue growing. We are preparing a pipeline where daily operations and UA will be managed efficiently. Based on this, growth will continue in the second half. Synergy effects will become more apparent in the second half as JustPlay connects with companies like Lifuhua and Springcomes. We also plan to onboard third-party games next year, which will drive even greater growth.

From a KPI perspective, we can look at Sensor Tower data, but it needs to be reviewed cautiously because it varies by user type. High download numbers do not necessarily mean high-quality users. At JustPlay, we aim to attract high-quality users and ensure they remain in the app. We intend to utilize AI to the fullest; NC already has strong AI capabilities, and we plan to apply them to operations as well.

Park Byung-moo = We initially tried to create synergies with other studios through JustPlay. However, because JustPlay's own growth is so rapid, we are focusing on that to maximize its potential. Through the second half and next year, we plan to connect studio SDKs directly so they can publish through JustPlay. Next year, we will also connect third-party studios to develop it into a more robust platform.

Can the good flow of Lineage Classic revenue continue, and can it lead to a long cycle like Lineage M.

Park Byung-moo = Usually, the MMORPG market sees a sharp decline after initial user influx, but Lineage Classic maintains a solid MAU. The development team says we are actually at the beginning of its lifecycle. We expect it to have a long lifecycle like Lineage M.

What is the future new game schedule?

Park Byung-moo = We have a very large lineup. We have about four blockbuster games prepared for the second half of this year and next year. Starting with Aion 2 Global, we expect early access pre-sales for Horizon Steel Frontiers, Cinder City, and Guild Wars 3 next year. Including third-party publishing contracts and in-house games, we have about 10 titles launching between the second half and next year. We expect to launch almost every month. We are adjusting schedules and testing, especially as Aion 2 Global coincides with the November release of GTA6. This includes both known and unknown titles.

All games released from now on will be global simultaneous launches. There were concerns about our global publishing capabilities, but we have recruited many experts from global publishers and aligned our operations. Our capabilities have been strengthened, and we are confident in our global publishing. We also plan to implement localized publishing for each region.

What is the outlook for Aion 2 in the second half? Why did the payment method change in China?

Park Byung-moo = Aion 2 had a Chapter 1 update in July. Before that, we lowered membership prices and rationalized cosmetic purchases. Despite this, indicators for July and August show increased PCU and higher revenue compared to June. MAU is no longer declining and is slowly rising. We were concerned that Korean and Taiwanese users would leave ahead of the Aion 2 global launch, but the fact that it increased is encouraging. I believe the development team's active communication has led to great results, and it will be a long-run title. We do not expect a downward trend through Q3 and Q4.

There are relatively few MMORPGs in the Chinese market. The original plan was to enter China after the success of the Aion 2 global launch. However, since the beginning of this year, we received active inquiries from Chinese companies, and we decided to partner early with the company that offered the best conditions and capabilities. We plan to collaborate flexibly in China.

The collaboration with Shengqu for Aion 2 is not yet signed, but it includes the Aion PC version publishing contract and a contract to make the Aion 2 mobile version similar to Aion Classic. The broad framework is agreed upon, but specific details are under negotiation. If signed as early as August, we will disclose it separately. The terms are very favorable.

Please explain the outlook and development status of Guild Wars 3.

Park Byung-moo = Guild Wars is not well-known to Korean users, but it is one of the top 3 MMORPG series in the West, alongside WoW and Final Fantasy. When Guild Wars 2 launched in 2012, it had 6 million community users. Currently, the Guild Wars franchise community and player base reach 30 million. It is so solid that it ranked 2nd on the Steam wishlist after its announcement at SGF. We are currently investing significant resources to prepare content for the launch.

We expect to conduct alpha and beta tests sometime next year. You can estimate the launch timing by looking at when the loan maturity expires. There are suspicions of cannibalization with Guild Wars 2, but after the SGF announcement, Guild Wars 2's MAU and revenue hit a 3-year high. The franchise is that strong. We are developing Guild Wars 3 so that it can be played alongside Guild Wars 2, which will continue to be live-serviced as a separate IP.

We are also planning marketing according to future test schedules. Regarding Guild Wars 3's profitability, I want to share a comparison: when Guild Wars 2 launched, there were 6 million community users and 3 million packages sold in the first year. Now there are 30 million. In 2012, Guild Wars 2 launched only on ArenaNet's own platform and not in Asia. Guild Wars 3 will launch simultaneously on Steam and consoles, as well as ArenaNet's platform. We also plan to use the Purple platform and localize it for the Asian market.

Technical cooperation between headquarters and ArenaNet is very active. ArenaNet developed up to Guild Wars 2 with its own engine, but is now developing with Unreal Engine 5. NC headquarters has been developing with Unreal Engine 5 for a long time. While we do not interfere with game design, we have established and are actively pursuing a collaborative relationship on technical aspects.

H1 performance is very good; is there a change in annual guidance? What about mobile casual guidance? Will next year's main revenue be based on legacy IPs or new titles.

Park Byung-moo = It is difficult to provide specific guidance. We mentioned the upper end of KRW 2.5 trillion, but it seems we will significantly exceed it. Q3 growth may slow due to seasonal factors, marketing costs, and pre-reflected developer rewards, but it will grow significantly YoY. We expect growth to be very steep in Q4. For the mobile casual sector, as seen with JustPlay, growth is significant, and we expect that trend to continue.

Looking at 2026 and 2027 together, high-speed growth will continue. There is organic growth, and synergies with acquired studios will materialize. Looking at the outlook through next year, we are preparing to publish many titles that haven't been announced yet. These will generate significant revenue next year. We are also discussing M&As that can create the most synergy. We expect high-speed growth next year.

In 2027, we have regional expansions of existing games like Lineage Classic, Aion Mobile in China via Shengqu, and spin-off games using the Guild Wars IP. However, we expect the bulk of revenue to come from new IPs. In addition to the 4 blockbuster IPs, about 10 other games will be released.

Annel Cheman = It is difficult to be specific, but I believe the growth trend will continue. JustPlay is key and will grow further. Synergy effects will manifest in Q3 and Q4, leading to further growth.