NCSOFT recorded an earnings shock during the January-March period due to a sales slowdown of its major games including "Lineage M," while advertising expenses increased in preparation for overseas rollouts.
The game company announced Friday that its first-quarter sales stood at 358.8 billion won ($305 million) while its operating profit reached 79.5 billion won.
These were down 10 percent and 29 percent, respectively, from the previous quarter, and 24 percent and 61 percent from the previous year.
The figures were below the market consensus as securities firms estimated the game company's sales at 388.8 billion won and operating profit at 117.3 billion won.
Sales from mobile games were tallied at 198.8 billion won, falling 11 percent from the previous quarter. This was attributed to the firm having added a few new items for "Lineage M" in January and February ahead of the game's large-scale update, which was carried out March 6.
"Lineage M," the mobile version of its massively multiplayer online role playing game (MMORPG), "Lineage," was released in June 2017, and has been its most popular game app on Google Play Store since then.
Sales from online games also decreased 47 percent from the previous quarter as the firm slowed down on adding new items for "Lineage," while preparing for the launch of its upgraded version, "Lineage Remastered."
The company said it will see a rebound in the second quarter.
"We expect sales from Lineage M to increase in the second quarter," NCSOFT Chief Financial Officer Yoon Jae-soo said during a conference call.
The firm said it plans to start "Lineage M" services in Japan, May 29, hoping to expand sales further.
"One of our major tasks of the year is expanding overseas sales," Yoon said.
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