Krafton (259960) 🔎 In-depth
KOSPI · Price as of 2026-08-06 · Updated 2026-08-09
Krafton is a game developer and publisher that generates most of its revenue from a single battle-royale title, 'PUBG: Battlegrounds.' It earns money in two main ways: on PC through the sale of in-game items such as outfits and weapon skins plus live-service operations, and on mobile through in-app purchases in 'PUBG MOBILE,' developed in partnership with Tencent — both of which are the core cash cows. In the first quarter of 2026, revenue from the PUBG IP franchise alone topped ₩1 trillion in a single quarter. Under the shareholder-return policy announced in February, the company bought back ₩200 billion of its own stock in Q1, paid ₩99.6 billion in dividends, and retired ₩336.2 billion worth of treasury shares (newly acquired plus previously held), while a record first quarter confirmed a step-up in profits. Its strengths are a long-running IP whose revenue is still growing in its ninth year on the market, an operating margin in the 30% range, an effectively debt-free balance sheet and treasury-share retirement; the caution is that most revenue comes from the single PUBG IP, so results are sensitive to live-service traffic and to mobile-partner and India-policy variables.
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30-second brief
Pulled directly from the computed values below — not a separately written opinion.
What do the SourceComputedEstimateReading tags mean?
Source filings and exchange data · Computed calculated from public data · Estimate our own unverified projection · Reading drafted automatically, then rule-checked. See AI & Automation.
Core valuation metric
This stock's effective sub-sector is “Games” (Games, Entertainment & Content), a type typically read first through forward P/E.
Game companies' results hinge on new title launches, so expected future profits explain the share price better than past earnings do. That's why forward P/E — based on projected net income — comes before the trailing figure here.
Price against earnings alone becomes unstable when earnings swing. Reading it together with price against assets helps gauge the downside.
This note explains how each sector is typically valued and is educational context only, not investment advice.
At-a-glance assessment financial health · growth · profitability · valuation
- Debt ratio, current ratio and interest burden all look healthy.
- Revenue rose 22.8% year over year, and the pace is slowing (3-year trend: rising).
- Most recent quarter (Q1 2026) revenue was 56.9% higher than a year earlier.
- ROE is 12.0% (controlling-interest basis). It is above the sector average.
- Operating margin is 30.3%.
- A sector-metric and in-depth research verdict — see “Valuation vs peers” below for the basis.
Ownership & governance As of 2024-12-31
Largest shareholder Chang Byung-gyu 14.89% (individual)
Controlling bloc incl. related parties 18.72%
With the controlling bloc holding 19%, control is maintained but the free float is relatively large.
🔎 In-depth analysis Reading
Krafton is a game developer and publisher that generates most of its revenue from a single battle-royale title, 'PUBG: Battlegrounds.' It makes money in two broad ways. On PC, the core cash cow is the sale of in-game items such as outfits and weapon skins plus live-service operations; on mobile, it is in-app purchases in 'PUBG MOBILE' (and the India-only BGMI), developed in partnership with Tencent. Q1 2026 revenue by segment was ₩702.7 billion for mobile, ₩363.9 billion for PC, ₩13.8 billion for console and ₩291.0 billion for other; PUBG IP franchise revenue alone exceeded ₩1 trillion in the quarter. Notably, the India-only version, Battlegrounds Mobile India (BGMI), has become a 'national game' locally, with total registered users of 260 million and paying users up 17% from a year earlier. Beyond this, Krafton is nurturing the life-simulation game 'inZOI' and the ocean-survival game 'Subnautica 2' as new titles, but the PUBG IP remains the center of its results. Heavy reliance on a single IP is a double-edged sword, but the essence of this company is that the IP is a long-running franchise whose revenue is actually still growing in its ninth year on the market.
The latest close is ₩230,000 and the market capitalization is ₩10.6 trillion. The price sits below its 20-day moving average (₩237,650) and below its 60-day moving average (₩244,283). It is under both its short- and medium-term moving averages, so the trend looks subdued. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 45.2, a neutral level. The one-month change is -6.1%, the three-month change is -19.0%, and the position relative to the 52-week high is -32.1%. Relative strength versus the KOSPI is 17 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 17% of all stocks. Over the past three months it outpaced the index by 1.3%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
On the valuation metrics, the P/E ratio (how many times one year's net profit the share price is) is 14.44x, the P/B (how many times book equity) is 1.45x, and the dividend yield is 0.95%. Profitability is solid, as befits a game maker, with a 31.7% operating margin, a 22.1% net margin and a 10.4% ROE (how much is earned in a year on shareholders' equity). The balance sheet is very stable: a low 32% debt-to-equity ratio, a 307% current ratio and an interest-coverage ratio of 90x mean debt is effectively a non-issue. That said, the 14.8x P/E here is based on last year's (2025) net profit of ₩734.8 billion. Because 2024 net profit jumped to ₩1,306.1 billion on factors such as smaller impairment losses before normalizing in 2025, last year's earnings are near the low point of the cycle. Measured against current earning power, this P/E has an illusory look of being pricier than it really is.
Revenue has risen every year for five straight years (₩1.89 trillion in 2021 → ₩3.33 trillion in 2025, growth of around 15% a year). 2025 revenue grew +22.8% year on year, extending the uptrend. Operating and net profit appear to have turned down in 2025 (-10.8% and -43.7% respectively), but this is not a deterioration — it is a base effect from a 2024 that was unusually high on one-off items such as reduced impairment losses. The real picture emerges in 2026. Q1 revenue was +56.9% year on year, operating profit +22.8% and net profit +38.4% (₩514.1 billion), a record quarter — and Q1 net profit alone already reached 70% of last year's full-year net profit. Content diversification and a strong live service on PUBG PC drove the growth, and mobile was solid as well. Because Q1 is a seasonal peak thanks to early-year content, the remaining quarters will not simply match this pace, but the direction — this year's earnings power far exceeding last year's — is clear. Reflecting this trajectory, the P/E on this year's expected net profit works out to around 10x, meaningfully lower than the 14.8x calculated on last year's results.
Recent disclosures center on shareholder returns and equity events. Under the shareholder-return policy announced in February, the company bought back ₩200 billion of treasury stock in Q1, paid ₩99.6 billion in dividends, and retired ₩336.2 billion worth of treasury shares combining newly acquired and previously held stock. A treasury-share disposal-result filing on June 2 continued this flow. Such large-scale treasury-share retirement is a substantive return that lifts per-share value by reducing the share count. In early June there were numerous routine filings, including reports on changes in the largest shareholder's stake, executive ownership status and a corporate-governance report. As is typical of a game maker, there are no order-book disclosures such as 'single sales/supply contracts'; the real drivers for the share price are results, live service for new titles, and execution of shareholder returns.
The strengths are clear: PUBG, a long-running IP whose revenue is still growing in its ninth year on the market; an operating margin in the 30% range; an effectively debt-free balance sheet; and shareholder returns that extend to treasury-share retirement. A record first quarter in 2026 confirmed the step-up in profits, and on this year's expected earnings the valuation is lower than on last year's results — the stock sits in a zone where earnings are improving while the price has been held down. The caution is the concentration, with most revenue coming from the single PUBG IP: results are sensitive to PUBG's live-service traffic, the reception of new content, and mobile-partner (Tencent) and India-market policy variables. Ultimately, the structure is strong as long as PUBG's live service keeps its momentum, but single-IP risk comes to the fore if IP traffic slows.
🔎 Valuation vs peers Undervalued
Compared mainly against large domestic listed game developers and publishers of comparable scale and profitability.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Netmarble | 14.20x | 0.56x | 6.18% |
| Pearl Abyss | 0.00x | 2.30x | 15.50% |
| Nexon Games | 0.00x | 2.53x | -24.26% |
Among Korea's large game makers, Krafton stands out in profitability and balance-sheet stability. Netmarble has a similar P/E but a low 4.1% ROE and thus weaker capital efficiency, while Pearl Abyss and Nexon Games are in a state where a P/E is meaningless due to weak results. Krafton's trailing P/E of 14.8x may look like a premium at first glance, but it is limited by being based on 2025 net profit, which surged on one-off factors in 2024 before pulling back. Reflecting this year's earnings trajectory — confirmed by a record first quarter in 2026 — the P/E on expected net profit falls to around 10x, and given the operating margin in the 30% range and a top-tier balance sheet, the current price is judged to sit in undervalued territory relative to earnings.
Price history Close · MA20 · MA60
The latest close is ₩230,000 and the market capitalization is ₩10.6 trillion. The price sits below its 20-day moving average (₩237,650) and below its 60-day moving average (₩244,283). It is under both its short- and medium-term moving averages, so the trend looks subdued. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 45.2, a neutral level. The one-month change is -6.1%, the three-month change is -19.0%, and the position relative to the 52-week high is -32.1%. Relative strength versus the KOSPI is 17 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 17% of all stocks. Over the past three months it outpaced the index by 1.3%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Relative performance stock vs index · start = 100
Excess return vs index · 3M +1.33% / 6M -27.39% / 12M -63.59%
Key metrics Computed vs sector median
Valuation
The P/E of 14.44x is above the sector median (10.02x). The P/B of 1.45x is above the sector median (0.77x).
Enterprise value (EV)
EV = market cap + net debt. It reflects cash and debt, so it captures the real cost of the whole business that market cap alone misses; lower multiples are cheaper relative to earnings or sales.
Intrinsic value (DCF estimate) Estimate
Model output — not a price target. This is what the formula returns under the assumptions below, not a view on where the share price should go.
DCF (discounted cash flow) estimate — discount rate 10.7%, initial growth 10.0%→terminal 2.0%, 10-yr forecast, free-cash-flow basis, forward earnings power normalized 1.424x. A reference range that shifts materially with assumptions.
Profitability & financials
Return on equity (ROE) is 12.0%, above the sector average (7.0%). The operating margin is 30.3%. The debt ratio is 32.4%, so the financial structure is stable.
Growth FY2025 · annual report (consolidated)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $1.3B | $1.9B | $2.3B | +22.76% ↓ slower |
| Operating profit | $539.6M | $830.7M | $740.7M | -10.83% ↓ slower |
| Net profit | $418.2M | $917.5M | $516.2M | -43.74% ↓ slower |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $1.3B | $1.3B | $1.3B | $1.9B | $2.3B |
| Operating profit | $457.1M | $528.0M | $539.6M | $830.7M | $740.7M |
| Net profit | $365.2M | $351.4M | $418.2M | $917.5M | $516.2M |
| Revenue CAGR | 4-yr avg 15.25% | ||||
Revenue rose 22.8% year over year (2023 ₩1.9 trillion → 2024 ₩2.7 trillion → 2025 ₩3.3 trillion), and the three-year trend is 'rising'. That said, the pace of growth slowed from the prior year. Operating profit fell 10.8% year over year. The decline widened. Over the 5 years on record, revenue compound annual growth (CAGR) is 15.2%. The two-year revenue CAGR is 31.9%. In the most recent quarter (Q1 2026), revenue was 56.9% higher than the same period a year earlier.
Latest quarterly results Source Q1 2026 · vs year-ago
Technical indicators Computed
What stands out
- ROE of 12.0% points to solid profitability.
- Revenue grew 22.8% year over year, a sign of growth.
- The balance sheet is stable in terms of debt and liquidity.
Points to watch
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2026-04-30EarningsQ1 2026 revenue of ₩1,371.4 billion and operating profit of ₩561.6 billion set an all-time quarterly record (revenue +56.9%, operating profit +22.8% YoY). PUBG IP franchise quarterly revenue passed ₩1 trillion (+24% YoY).Confirms entry into a phase of earnings step-up. A key event signaling that this year's earnings power far exceeds last year's. Source
- 2026-06-02UpdateTreasury-share disposal-result report filed. Under the shareholder-return policy announced in February, ₩200 billion of treasury stock was acquired, ₩99.6 billion paid in dividends, and ₩336.2 billion of treasury shares retired during Q1.A substantive shareholder return that lifts per-share value by reducing the number of shares outstanding. A signal of continued returns backed by financial capacity. Source
- 2026-06-01FilingCorporate-governance report filed and annual (once-a-year) large-business-group status disclosure submitted.Fulfillment of governance and routine disclosure obligations. Limited impact on individual results, but it confirms the scale of inclusion in the large business group. Source
- 2026-06-08FilingMultiple filings submitted, including a report on changes in the largest shareholder's shareholding and reports on holdings of specified securities by executives and major shareholders.Routine reporting of stake changes. Reference information for checking the stability of the governance structure. Source
Figure cross-check computed ↔ external
Recent filings Source
- 2026-06-08OwnershipLargest-shareholder ownership change report
- 2026-06-08OwnershipOwnership-change filing
- 2026-06-08OwnershipOfficers'/major-shareholders' holdings report
- 2026-06-08OwnershipOfficers'/major-shareholders' holdings report
- 2026-06-08OwnershipOfficers'/major-shareholders' holdings report
- 2026-06-08OwnershipOfficers'/major-shareholders' holdings report
- 2026-06-08OwnershipOfficers'/major-shareholders' holdings report
- 2026-06-08OwnershipLargest-shareholder ownership change report (amended)
- 2026-06-02TreasuryTreasury-stock disposal decision
- 2026-06-01Large-business-group status disclosure
- 2026-06-01Corporate governance report
- 2026-06-01Large-business-group status disclosure (amended)
📖 Plain-language glossary — expand if you are new to this
- P/E
- How many times a year's net profit the price is worth (lower is cheaper relative to earnings). The P/E here is on trailing (last full-year) results; for companies whose earnings swing fast (memory chips and other cyclicals/high-growth), a forward P/E on this year's expected earnings is more accurate.
- P/B
- Price relative to net assets (equity). Around 1x means it trades near book value; below 1x means below book.
- P/S
- Price relative to a year's revenue — useful for growth companies with thin earnings.
- Net debt / EV
- Net debt = interest-bearing debt − cash. Negative means more cash than debt (net cash). EV (enterprise value) = market cap + net debt, closer to what it would cost to buy the whole business.
- EV/EBIT · EV/EBITDA · EV/Sales
- Enterprise value against operating profit (EBIT), EBITDA, or revenue. Unlike P/E these reflect debt and cash; lower is cheaper relative to earnings power or sales.
- FCF / FCF yield
- Free cash flow = operating cash − capex, the cash actually left over. FCF yield = FCF ÷ market cap; higher means more cash generated per unit of market value.
- Intrinsic value (DCF)
- Future free cash flow (or, for some capex-heavy but profitable names, forecast earnings) discounted to today to estimate per-share value. Because it shifts a lot with the discount-rate and growth assumptions, it is shown as a bear/base/bull range, and the basis and assumptions are disclosed in one line beneath it.
- ROE
- How much profit the company earns in a year on its equity (%). Higher means better returns on capital.
- EPS / BPS
- Earnings per share / net assets (book value) per share.
- Operating / net margin
- Profit left from the core business / final profit after tax and interest, per unit of revenue.
- Debt ratio
- Debt relative to equity (%). Higher means more reliance on borrowing (norms vary by sector).
- Current ratio
- Assets convertible to cash within a year against debt due within a year. Above 100% leaves some short-term headroom.
- Interest coverage
- How many times operating profit covers the interest owed. Below 1x means operating profit alone struggles to cover interest.
- Dividend yield / payout ratio
- The year's dividend as a % of today's price / the share of earnings paid out as dividends.
- Revenue CAGR
- Multi-year growth expressed as a single yearly average (compound annual growth rate).
- RSI (short-term signal)
- Whether recent price action is overheated or beaten down. Above 70 is overbought, below 30 oversold.
- MA20 / MA60 (moving averages)
- The 20- and 60-day average price. Price above them signals a firmer short-term trend.
- vs 52-week high
- How far below the past year's peak the price sits now (%).
All figures are for reference only; how they read varies by sector and over time.
Sources: Korea FSC market-price API (data.go.kr), OpenDART, KRX/KIND — public data only.
Bong Stocks presents public-data-based information for reference only. It is not investment advice and contains no target prices, ratings, or buy/sell recommendations. Verify independently before making any decision.