Date: Tuesday, August 11, 2026
Agenda: Pearl Abyss Q2 2026 Earnings and Future Strategy

■ Summary of Pearl Abyss Q2 2026 Earnings and Status

▣ Q2 2026 Earnings Summary

- Q2 2026 Revenue: KRW 192.6 billion (+247.7% YoY, -41.4% QoQ)

ㄴ Weakened performance due to the fading impact of the new Crimson Desert launch

- Operating Profit: KRW 67.6 billion (+7411.1% YoY, -68.1% QoQ)

- Net Profit: KRW 70.9 billion (Turned to profit YoY, -58.3% QoQ)

- Revenue breakdown: Black Desert IP KRW 55 billion, Crimson Desert IP KRW 136.1 billion

ㄴ Approximately 2.11 million units of Crimson Desert sold in Q2

- Revenue by region: North America/Europe 75%, Asia 16%, Domestic 9%

- Revenue by platform: PC 61%, Console 34%, Mobile 5%

ㄴ Console maintains a high share as Crimson Desert accounts for approximately 70% of revenue

▣ Q2 2026 Cost Summary

- Q2 2026 Operating Expenses: KRW 125 billion (+129.4% YoY, +7.4% QoQ)

- Labor Costs: KRW 74.8 billion (+158.8% YoY, +94.8% QoQ)

ㄴ Increased due to Crimson Desert launch performance bonuses

- Commission Fees: KRW 30.6 billion (+133.6% YoY, -28% QoQ)

ㄴ Decreased in line with Crimson Desert sales

- Advertising Expenses: KRW 9.1 billion (+85.7% YoY, -61.1% QoQ)

ㄴ Decrease in marketing spend for Crimson Desert launch

▣ 2026 Guidance

- Q2 results fell short of guidance; new guidance provided

ㄴ 2026 Operating Revenue expected to reach KRW 709.8–743.8 billion

ㄴ 2026 Operating Profit expected to reach KRW 315.5–345.2 billion

▣ Business Status

- Crimson Desert

ㄴ Preparing DLC, pricing strategies, and platform expansion for long-term performance

ㄴ DLC content direction and quality currently under review; targeting year-end release

ㄴ Discount strategy currently being planned

ㄴ Preparing for basic playability on Switch 2, targeting release in the first half of next year

- Black Desert

ㄴ Efforts to improve performance through large-scale updates in the second half

ㄴ PC: 2026 Black Desert Heidel Ball in Q3 to reveal second-half plans

ㄴ Includes new class 'Agent', new region 'Edania Part 2', and esports operations

ㄴ Mobile: Stable live service to continue

- DokeV

ㄴ DokeV development targeting second half of 2028 release

ㄴ Full-scale marketing, including hands-on demos, possible from second half of 2027

- PLAN 8

ㄴ Focusing on DokeV development while maintaining a 2-3 year release interval

■ Q&A

Reason for missing guidance?

= Q2 results fell short of guidance due to an increase in the sales mix where only a portion of Crimson Desert sales is recognized as revenue. Physical sales revenue is recognized as a percentage of actual sales proceeds after deducting distribution commissions, logistics, and promotional costs. Additionally, there is a timing difference between sales and revenue recognition due to wholesale-retail settlement procedures, and 20% of the settlement amount was deferred for refund guarantees, leading to lower-than-expected revenue. Deferred revenue will be recognized sequentially in the second half.

We have adjusted our guidance to reflect these impacts and plan to focus on Black Desert live services and increasing Crimson Desert sales to meet the revised targets. We will continue to monitor key indicators and sales trends, doing our utmost to meet guidance through market-appropriate marketing and pricing strategies.

What is the annual sales forecast for Crimson Desert?

= We do not disclose separate sales forecasts for Crimson Desert. Please refer to the annual guidance provided.

Black Desert Q2 performance and second-half outlook?

= Black Desert exceeded guidance in Q2, though it showed a slight decline compared to the previous quarter as we focused on content improvements rather than large-scale updates. We also held the '2026 Black Desert Heidel Ball' in the U.S. to commemorate the 10th anniversary of our North American/European service, where we unveiled plans for large-scale content updates and system improvements scheduled for the second half.

While the first half focused on improving existing content, we expect performance to improve in the second half with large-scale content such as the new class 'Agent' and the new region 'Edania Part 2', alongside global esports plans.

Notably, following the release of our 32nd class, 'Agent', and the 'Hyper Boost' system to support the rapid growth of new and returning users, we have seen a rebound in user metrics, including higher Steam rankings, increased streaming viewership, and rising DAU. We are committed to providing rich content in the second half to drive strong results.

Long-term growth strategy and DLC plans for Crimson Desert?

= We are preparing various follow-up strategies, including DLC and platform expansion, to expand our user base and drive long-term revenue growth. As an IP with significant potential for expansion in world-building, characters, and regions, we plan to extend its lifecycle through continuous content delivery.

DLC is being developed with the goal of providing new gameplay experiences, targeting a release within the year. Details on composition, pricing, and release schedule will be announced in Q3. Plans regarding the number of DLCs and release frequency are not yet finalized; we are currently focused on the quality and launch performance of the first DLC. Future DLC and operational plans will be determined by considering user feedback, sales trends, development resources, and overall company schedules.

What are the plans for discounts.

= Various promotions, including discounts, are a key sales strategy for package games. We are internally reviewing appropriate discount rates and timing. We will focus on measures that maximize long-term revenue and expand our new user base, rather than simply lowering prices.

Expansion of Crimson Desert to Switch 2? Any mobile plans.

= We are working to bring Crimson Desert to as many platforms as possible. However, platform expansion is not just about simple porting; the key is maintaining the game's graphics, action, and open world experience on the target device. For Switch 2, while optimization is required, it is currently at a level where basic play is possible, and we are conducting technical reviews regarding performance optimization and quality standards. While it is difficult to confirm a release date, we are targeting the first half of 2027.

There are currently no plans for a mobile version of Crimson Desert. As the game's core value lies in high-quality graphics, action, and open world experiences, we must first verify if these can be implemented with sufficient quality in a mobile environment. We are continuously researching the mobile scalability and optimization of the BlackSpace Engine, but our current priority is DLC and next-gen project development. We will continue to review mobile expansion while considering technical environments, marketability, and development priorities.

Plans for Crimson Desert multiplayer?

= Given its action-oriented nature and open world structure, Crimson Desert has sufficient potential for multiplayer expansion. However, multiplayer is a major task that requires reviewing server structure, balance, platform-specific stability, and operational systems, rather than just adding a mode. We are conducting various studies on both technical feasibility and gameplay. We are exploring ways to allow users to enjoy the Crimson Desert IP for longer and will announce details through official channels as they materialize.

What is the status of the Crimson Desert franchise.

= Crimson Desert is not a one-off IP but a core IP that we intend to grow and expand long-term. We are keeping various possibilities open, including additional content, platform expansion, and sequels, but we are currently focused on Crimson Desert DLC and next-gen projects. For the franchise, we will review further development while servicing the main game and DLC, taking into account user feedback, market conditions, and business performance.

Status of Crimson Desert's Chinese license (ISBN)?

= The Chinese market is important in terms of industry scale, so we are continuously monitoring it, but there are no specific plans to apply for a license at this time. We are consistently reviewing global expansion possibilities, including China, and will announce any significant decisions through official channels.

What content will be revealed at Gamescom.

= At this year's Gamescom, we plan to hold a lecture focusing on our development experience and technical achievements with the 'BlackSpace Engine'. Through this, we intend to showcase our development capabilities and technical competitiveness to the global gaming industry. We are also preparing on-site demos of Crimson Desert through partnerships, providing another opportunity to engage with North American/European users and industry stakeholders.

What kind of game is DokeV.

= DokeV is an 'open world action-adventure with a new worldview and story' where players adventure with DokeV, exploring the world and growing freely. We are developing it with a focus on bright, unique visuals, action, exploration fun, and various interactive elements. Specific game systems and gameplay content will be revealed sequentially in line with our marketing schedule.

What is the development status and marketing schedule for DokeV.

= DokeV is being developed stably by leveraging development assets and production experience accumulated through previous projects. We have moved beyond the core system construction phase and are now expanding content production and verifying the gameplay loop. We are targeting a release in the second half of 2028 and plan to roll out information and marketing in stages. Given the current development status, we expect to begin full-scale marketing, including hands-on demos, from the second half of next year.

Video releases are being reviewed within our marketing strategy. We believe it is more important to maintain user interest and anticipation from the reveal until the launch, rather than simply rushing the reveal. Past experience has shown that revealing content too early can lead to a depletion of anticipation, so we plan to release content when we can fully demonstrate the game's quality and direction.

Current number of DokeV development staff?

= It is difficult to provide specific numbers as development staff are managed flexibly based on project stages. However, as Crimson Desert patches stabilize, developers are gradually moving to DokeV, and we are doing our best to meet the announced release date in the second half of 2028.

How are you utilizing engines and AI?

= The BlackSpace Engine is one of Pearl Abyss' core technical competitive advantages, and we are currently using it to strengthen our own IP rather than selling it externally. In the long term, we plan to implement a user-generated content ecosystem based on the BlackSpace Engine to create a platform where players and creators can participate and grow together.

We are utilizing AI technology to improve development productivity and quality. It is being used in various areas such as automating repetitive tasks, supporting content production, and streamlining testing, and we are expanding its application across our development pipeline. We use AI as a tool to enhance efficiency and quality, not as a replacement for developers. We will continue to increase the scope of AI usage to deliver higher-quality games faster.

Are there any investment plans.

= We are reviewing various possibilities as part of our growth strategy, but we are approaching M&A cautiously, fully considering long-term direction and impact on shareholder value. Currently, we are focused on developing next-gen projects including DokeV and strengthening our core IP, while prioritizing our new vision of building a creative ecosystem. However, if we identify opportunities that substantially contribute to company growth and corporate value, we will review new businesses and M&A with an open mind.