TLDR
- Gumi’s revenue dropped by 52.5% year-on-year, totaling $9.2 million in the first quarter.
- Despite the decline in gaming revenue, Gumi posted a net income of $8.4 million, reversing last year’s loss.
- The company leveraged Bitcoin gains, reporting $7.4 million in non-operating income from cryptocurrency holdings.
- Gumi plans to acquire $17 million worth of XRP to further strengthen its crypto portfolio.
- The mobile gaming division saw a 66.5% revenue drop due to restructuring, asset sales, and operational shifts.
Gumi posted a major profit turnaround this quarter due to gains from its cryptocurrency portfolio, despite a gaming revenue decline. The Tokyo-based mobile game developer saw profits driven mainly by Bitcoin and upcoming XRP acquisitions. Gumi recorded a significant net income rise even while its core business faced ongoing structural challenges.
Gumi Shifts Focus to IP-Based Games
Gumi’s gaming revenue dropped 66.5% year-on-year to $4.7 million following its exit from low-performing titles. The company sold its subsidiary Alim and outsourced operations to manage costs and reduce future losses. Consequently, this segment reported a $630,000 operating loss, reversing a prior profit.
Despite this, Gumi continues to develop games using third-party intellectual property instead of original creations. Management stated,
“We are shifting resources to more predictable IP-based titles for long-term stability.”
However, it withheld a full-year forecast citing uncertain market trends.
The mobile game business, once Gumi’s core driver, now contributes less to overall earnings. Structural reforms and asset sales further weakened its revenue base. Management emphasized ongoing rebalancing efforts across the division.
Bitcoin Holdings Drive Profit Turnaround
Gumi purchased $6.7 million in Bitcoin over six months, which added strong gains through mark-to-market accounting. The company also announced plans to acquire $17 million in XRP to strengthen its crypto assets. These moves yielded $7.4 million in non-operating income this quarter.
Thanks to this, Gumi’s ordinary profit surged 371.1% year-on-year, reaching $8.3 million, with net income climbing to $8.4 million. Operating profit improved by 11% to $491,000 despite a sharp drop in total revenue. Gumi reported total revenue of $9.2 million, down 52.5% compared to last year.
“Cryptocurrency assets have enhanced our financial resilience amid restructuring,” management said in its quarterly report. This trend is likely to continue. Gumi now views blockchain as a central business pillar.
Blockchain Segment Gains Momentum
Gumi launched “Phantom of Kill Alternative Imitation” under its OSHI3 fan-engagement project, supporting its blockchain expansion. The new title generated additional income through token-based features and crypto rewards. Blockchain revenue offset losses from the declining gaming segment.
The company confirmed that further blockchain-related games and services are under development. Gumi intends to integrate crypto utility across its content and community platforms. This strategy aims to stabilize revenue through diverse digital assets.
