Krafton’s Q2 income drops 26% to $177m on PUBG slowdown

Krafton Inc., the South Korean publisher of PUBG: Battlegrounds, reported a profit decline for the first time in two years.

The company’s operating income fell 26% to 246 billion won (US$177 million) in the second quarter of 2025, while revenue decreased by 6.4% to 662 billion won (US$510 million).

This decline is attributed to a seasonal slowdown in PUBG: Battlegrounds. Other titles failed to compensate for the loss.

Krafton’s virtual simulation game, Inzoi, which launched in early access in March, sold a million copies in its debut week.

However, its active user base dropped sharply to around 4,300 from 87,400 at launch, according to Bloomberg Intelligence data.

Krafton’s shares fell 6.6% this month after the company announced a delay for its upcoming title, Subnautica 2.

The release has been moved from late 2025 to 2026. This delay has resulted in a lawsuit from the former founders of the studio behind Subnautica 2.

They are pursuing a US$250 million performance-based bonus, alleging that Krafton intentionally delayed the game’s release to avoid paying the bonus.

Krafton has denied these allegations, asserting that the delay was necessary to ensure the game’s quality and protect its brand reputation.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Gaming revenue follows predictable seasonal patterns that challenge steady growth

Krafton’s seasonal slowdown in PUBG reflects a well-documented industry pattern where gaming revenue fluctuates throughout the year.

Video game sales typically peak in November and December, often exceeding three times the monthly average during holiday seasons, according to NPD Group data 1. This creates a challenging dynamic for publicly traded gaming companies that must report consistent quarterly performance.

The summer months traditionally represent a low point for gaming engagement, as players shift attention to outdoor activities and travel. Over 90% of top-grossing mobile games now use seasonal events specifically to combat these natural dips in player activity 2.

This seasonality explains why many gaming companies struggle with Q2 and Q3 earnings, as the period between major holiday releases creates predictable revenue valleys that are difficult to offset through other initiatives.