KOSDAQGames067000

JoyCity

₩1,216▼ 0.49%2026-10-02 close

Market Cap

₩85.6B

Turnover

₩900M

Volume

740,000 shares

Shares out.

69.9M

PER

—

PBR

1.0×

EPS

-₩149

Dividend Yield

0.00%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close

Report overview

New Titles Versus Penny-Stock Delisting Risk

JoyCity is recovering top-line growth through new titles such as Biohazard and Imjin War, but the company faces simultaneous pressure from thinning profitability and KOSDAQ's new penny-stock delisting rules.

1
2025 consolidated revenue was KRW 140.36bn with operating profit of KRW 5.66bn (4.0% operating margin), a margin contraction versus the prior year
2
Owners' net income turned positive at KRW 0.39bn in Q1 2026 but reverted to a net loss of KRW 0.68bn in Q2 2026
3
A new title lineup including Biohazard: Survival Unit, Imjin War: Joseon's Counterattack, Freestyle: Reboot, and Freestyle Football 2 has launched sequentially through 2025-2026
4
The share price has repeatedly fluctuated near the boundary of KOSDAQ's new 'coin stock' management-issue threshold (30 consecutive trading days below KRW 1,000)
5
The controlling shareholder Endream and the CEO have disclosed on-market share purchases

Business structure

JoyCity was established in 1994 and listed on KOSDAQ in 2008 as a first-generation Korean game developer and publisher.

The company grew on the back of its 'Freestyle' intellectual property, starting with the online sports game Freestyle launched in 2004 and followed by Freestyle 2 and 3on3 Freestyle, which built its recognition in the sports-game space.

Following the shift to mobile, the company built a global revenue base around simulation-genre titles using well-known IP such as Gunship Battle: Total Warfare and Pirates of the Caribbean: Tides of War.

As of Q1 2026, overseas revenue accounted for 81% of the total, with mobile games at 68.1%, online games at 23.1%, and other at 8.8%, underscoring a mobile- and overseas-driven revenue structure.

More recently, the company diversified its geographic mix by launching the 4X strategy title Biohazard: Survival Unit—co-published with Aniplex—globally in November 2025 and in Korea/Taiwan in February 2026, surpassing 6 million cumulative global downloads by March.

JoyCity has also expanded its publishing capability with the historical strategy MMORPG Imjin War: Joseon's Counterattack, led by director Kim Tae-gon, which launched on April 28.

Freestyle Football 2, a console/PC title developed on Unreal Engine 5 by subsidiary Woore, is being prepared for release as a paid package title, while Freestyle: Reboot, which reworks the legacy basketball IP on a new engine, launched on August 13, 2026.

The controlling shareholder is Endream and an affiliated party holding a combined 34.1% stake, and the company operates five subsidiaries to pursue development and publishing synergies.

Earnings trend

Quarterly revenue · Operating profit

₩33B₩3.1B25Q2₩26.5B-₩3B25Q3₩48.2B₩3.3B25Q4₩42.2B₩300M26Q1₩38.6B₩600M26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩163.8B₩7.4B2022₩149.6B₩25.3B2023₩142.8B₩11.6B2024₩140.4B₩5.7B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩33B	₩3.1B	9.5%
2025Q3	₩26.5B	-₩3B	−11.2%
2025Q4	₩48.2B	₩3.3B	6.8%
2026Q1	₩42.2B	₩300M	0.7%
2026Q2	₩38.6B	₩600M	1.5%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩163.8B	₩7.4B	₩3.2B	4.5%	3.2%	150.5%
2023	₩149.6B	₩25.3B	₩5.5B	16.9%	5.2%	125.0%
2024	₩142.8B	₩11.6B	-₩5.6B	8.1%	−5.8%	138.6%
2025	₩140.4B	₩5.7B	-₩9.2B	4.0%	−10.7%	144.8%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23

Earnings analysis

Annual revenue contracted for three straight years, from KRW 163.78bn in 2022 to KRW 149.62bn in 2023, KRW 142.85bn in 2024, and KRW 140.36bn in 2025. Operating margin swung sharply, improving from 4.5% in 2022 to 16.9% in 2023, before declining again to 8.1% in 2024 and 4.0% in 2025.

Owners' net income was profitable at KRW 3.19bn in 2022 and KRW 5.51bn in 2023, then swung to losses of KRW 5.55bn in 2024 and KRW 9.23bn in 2025, widening the gap between top-line and bottom-line performance.

On a quarterly basis, Q3 2025 revenue fell to KRW 26.48bn with an operating loss of KRW 2.96bn, while Q4 2025 revenue jumped to KRW 48.21bn with an operating profit of KRW 3.29bn, yet the net loss reached KRW 7.77bn, reflecting a large gap between operating and net results.

In Q1 2026, revenue rose 28.9% year-on-year to KRW 42.20bn, but operating profit plunged 85.6% to KRW 0.31bn, while owners' net income turned positive at KRW 0.39bn.

In Q2 2026, revenue came in at roughly KRW 38.64bn with operating profit of about KRW 0.58bn; revenue grew 17% year-on-year while operating profit fell 81% year-on-year, and owners' net income reverted to a loss of KRW 0.68bn.

This pattern indicates a recurring structure in which upfront marketing and R&D spending on new titles erodes profit even as revenue expands.

Industry analysis

The domestic game industry is diversifying across genres such as 4X strategy, SLG, and console/PC packaged titles amid slowing mobile revenue growth.

JoyCity is combining its war-simulation and 4X genre experience, built on titles such as Gunship Battle and Pirates of the Caribbean, with the Biohazard IP to reinforce a strategy centered on leveraging major global IP, which is cited as a point of differentiation within a competitive landscape that includes mid- to large-cap publishers such as Nexon, Com2uS, Webzen, and Wemade.

At the same time, the company is attempting to broaden its business model from free-to-play mobile games toward paid console/PC packages through Freestyle Football 2, an approach that draws industry attention because of its different initial revenue-capture speed and margin structure compared with live-service games.

Small and mid-cap KOSDAQ game stocks broadly fall within the direct scope of the tightened delisting requirements implemented in 2026, under which newly introduced management-issue and delisting rules apply to stocks trading below KRW 1,000 or falling short of market-cap thresholds, dampening investor sentiment toward low-priced, small-cap game issuers.

This regulatory environment is cited as a factor that adds to share-price defense pressure regardless of whether new titles succeed commercially.

Outlook

The company has stated its policy of sequentially rolling out a new lineup in the second half to drive an earnings turnaround.

On August 13, Freestyle: Reboot—a rework of the Freestyle IP on a new engine—launched, while the soccer title Freestyle Football 2 is undergoing open-beta testing to refine quality ahead of a planned paid-package release in the fourth quarter.

Whether Imjin War: Joseon's Counterattack, which entered official service in April, becomes a new cash cow remains a point to watch.

DS Investment & Securities, in a report dated March 10, 2026, forecast JoyCity's 2026 results at revenue of KRW 184.5bn and operating profit of KRW 22.2bn, projecting simultaneous top-line growth via Biohazard and margin improvement via Freestyle Football 2, and noted that the football title's platform characteristics could allow an operating margin of 30-50%, contributing to profitability gains; this reflects a single brokerage's projection at that time and may differ from actual results.

The controlling shareholder Endream disclosed an additional stake purchase, explaining that the move reflected a commitment to enhancing shareholder value and stabilizing the share price.

As new-title performance feeds into revenue diversification, whether this translates into actual profit improvement remains the key point to monitor over the coming quarters.

Valuation

PER

—

PBR

1.0×

ROE

-11.4%

EPS

-₩149

BPS

₩1,205

Dividend per share

₩0

JoyCity's price-to-book ratio sits near the 1x level, a zone that does not show a pronounced premium or discount relative to net asset value.

Because net losses have continued on a trailing four-quarter combined basis, a conventional price-to-earnings comparison is difficult to construct, consistent with the shift to annual net losses in 2024 and 2025. The company currently pays no cash dividend, limiting the appeal of shareholder returns through dividends.

Management has indicated it would consider shareholder-return measures such as dividends or treasury-share cancellation once new-title performance becomes visible, though no concrete execution plan has been finalized.

Ultimately, the direction of valuation appears tied to whether the revenue contribution from upcoming titles translates into an actual profit recovery.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-08-23

Bull factors

New-Title Portfolio Diversification

Biohazard: Survival Unit's initial performance marked a company record, and it has been assessed as demonstrating both major-IP sourcing capability and 4X development competence.

With multiple titles across genres—Imjin War: Joseon's Counterattack, Freestyle: Reboot, and Freestyle Football 2—progressing simultaneously, there is potential to reduce dependence on any single IP. Revenue growth of 28.9% and 17% year-on-year in Q1 and Q2 2026, respectively, confirms a top-line recovery in practice.

Room for Margin Improvement via a Package-Sale Model

Freestyle Football 2 is set to launch as a paid package rather than a free-to-play title, and given the platform's characteristics, there is an assessment that its margin could be higher than that of live-service mobile games. Package sales also offer the advantage of capturing initial revenue relatively quickly.

If the title succeeds commercially, the structure allows for a relatively faster recovery of upfront marketing and development spending.

Share Purchases by the Controlling Shareholder and Management

The controlling shareholder Endream disclosed the purchase of more than 1% of outstanding shares, explained as a decision reflecting a commitment to shareholder value enhancement and share-price stability. The CEO has also been confirmed via disclosure to have made on-market purchases.

Such capital commitments by insiders can be referenced as a factual indication of management's stated position on the company's situation.

Bear factors

Structural Margin Deterioration

Operating margin declined for two consecutive years, from 16.9% in 2023 to 8.1% in 2024 and 4.0% in 2025. Owners' net income also posted losses in both 2024 and 2025.

Even in Q1 and Q2 2026, when revenue grew, operating profit fell 85.6% and 81% year-on-year, respectively, reflecting a recurring structure in which marketing and R&D costs for new titles offset a substantial portion of profit.

KOSDAQ Coin-Stock Delisting Rule Risk

The amended listing rules stipulate that a stock will be designated a management issue if its price stays below KRW 1,000 for 30 consecutive trading days or falls short of the market-cap threshold, and will ultimately face delisting if it fails to exceed the threshold for 45 consecutive trading days within a subsequent 90-day window.

JoyCity's closing price fell below the KRW 1,000 line at times in June and July 2026, coming close to this requirement. Even though the current price is above this line, renewed volatility could bring this regulatory risk back into focus.

Slowing Growth of Legacy IP

The growth of the long-running Freestyle series, which has driven revenue for years, is cited as having slowed. Mobile titles Pirates of the Caribbean and Gunship Battle are also understood to have seen revenue declines due to lifecycle maturity and slowing new-user acquisition. Whether new titles can fill this gap has not yet been sufficiently proven.

Risk factors

New-Title Commercial Risk

Given the nature of the game industry, marketing and development costs are front-loaded before a title's launch, which can limit sentiment improvement until commercial success is confirmed.

With multiple new titles—Freestyle Football 2, Freestyle: Reboot, and Imjin War—progressing simultaneously, overlapping commercial disappointments could cause costs to accumulate.

Listing-Maintenance Regulatory Risk

Amendments to KOSDAQ listing rules have tightened delisting requirements for financially weak companies, and a sustained period of trading below KRW 1,000 can lead to management-issue designation and subsequent delisting procedures.

Once designated a management issue, share consolidations or capital reductions exceeding a 10-to-1 ratio are prohibited, limiting available remedies. Given that JoyCity's share price has previously come close to this threshold, the risk could resurface depending on future price movements.

Financial and Capital Structure Risk

The consolidated debt-to-equity ratio rose to 144.8% in 2025 from 125.0% in 2023, and consolidated operating cash flow was negative at KRW -1.86bn in 2025.

With accumulated deficits on the books, normalizing the financial structure through earnings improvement would need to precede any aggressive shareholder-return measures such as dividends or treasury-share cancellations.

What to watch next

Q4 2026
Check the official paid-package launch of Freestyle Football 2 and its initial sales volume to assess whether it contributes meaningfully to profit.
Mid-November 2026 (around the statutory Q3 report filing deadline)
Review the Q3 2026 earnings disclosure to check the revenue contribution from new titles and whether marketing-cost pressure has eased.
Ongoing monitoring of share-price trend
It is necessary to continuously monitor whether the share price again approaches KOSDAQ's coin-stock management-issue threshold (30 consecutive trading days below KRW 1,000).
Following stabilization of Imjin War: Joseon's Counterattack service
Check whether the published title's revenue contribution persists and whether it settles in as a stable cash cow.
Timing of follow-up disclosures on Endream/CEO share purchases
Check whether the controlling shareholder and management make additional purchases and whether shareholder-return policy becomes more concrete.

Overall view

JoyCity is pursuing revenue diversification and top-line recovery through a simultaneous rollout of multiple new titles—Biohazard, Imjin War, and Freestyle Reboot/Football 2—with Q1 and Q2 2026 revenue each posting double-digit year-on-year growth.

However, operating profit fell sharply over the same period and net income swung between profit and loss, meaning earnings stability has not yet been confirmed. The decline in operating margin from 16.9% in 2023 to 4.0% in 2025 shows that the burden of new-title investment has persisted for a considerable period.

Adding to this is the new institutional variable of KOSDAQ's coin-stock management-issue rule, which has increased share-price defense pressure regardless of underlying performance.

Share purchases by the controlling shareholder and management are a factual sign of committed governance, but they do not by themselves guarantee an earnings turnaround.

Ultimately, how quickly the early performance of new titles converts into actual profit will likely be the key variable to watch over the coming quarters.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.