■ Future outlook for Wonder Planet <4199>

1. Performance Outlook for the Fiscal Year Ending August 2025

For the fiscal year ending August 2025, the company plans to continue promoting its growth strategy towards a profit growth phase after investment. To cover the cost burden associated with growth investments, the company expects to secure an operating profit for the entire year by leveraging resources across the organization. In the fiscal year ending August 2025, revenue declines due to the end of service for overseas versions of "Jumping Heroes" and "Crash Fever", the advance investment in "Pandaland", and increased new development costs are expected to exert short-term pressure on performance. However, from a mid- to long-term perspective, expansion of performance is anticipated due to the success of new titles and the resurgence of existing titles.

As key strategies from March 2025, the focus will be on the resurgence of "Crash Fever", the expansion of users for "Pandaland", and new development of two major IP titles. "Crash Fever" significantly contributes to profits on its own, and its 9th-anniversary event was successful. Promotions aimed at user return for the 10th-anniversary event are also being planned. Additionally, improvements are being made to games in "Pandaland" to enable investment returns. The target is to release new development titles at a rate of about one per year, and the burden of development costs is being shared with partners to mitigate risks.

The company does not disclose its full-year performance forecasts. The recent changes in the competitive environment surrounding the global mobile game market have become more pronounced than before, making it difficult to make precise predictions about performance trends. Therefore, the company believes it is challenging to formulate and disclose reasonable and reliable performance forecasts. As soon as it becomes possible to make appropriate and reasonable performance forecasts due to the passage of time, the company plans to promptly disclose such forecasts.

Regarding dividends, the company plans to focus on strengthening internal reserves for the time being, and intends to effectively utilize internal reserve funds as working capital for future growth. Therefore, at this point, the likelihood of implementing dividends and the timing of such implementation remain undecided. The company believes that, given the current situation where investment is necessary for business expansion, attention should be paid to future returns on invested capital rather than short-term dividends.

2. Outlook by title

(1) "Crash Fever"

In the first quarter of the fiscal year ending August 2025, "Crash Fever" is expected to see a decrease in revenue due to the end of the 9th anniversary campaign. However, the title is entering its 10th year of operation, with a policy aimed at regrowth being indicated. Specifically, a promotion is being planned to encourage user return, which may contribute to an increase in revenue. The title has a stable user base over a long period, and depending on this promotion, the possibility of regrowth is expected according to our company.

(2) "Pandaland"

"Pandaland" is currently seeing investment prioritized, and efforts are being made to monitor and improve investment effectiveness. However, it is anticipated that it will take some time to transition to profit contribution. For this reason, while significant contributions to performance in the fiscal year ending August 2025 are not expected, medium- to long-term business scale expansion is anticipated.

(3) New Development Titles

To expand revenue in the medium to long term, active investment will continue in new development titles. The goal is to release about one new title per year starting from 2025, and currently, two strong IP titles are being developed in collaboration with partners. While these titles are expected to lead to revenue increases in the future, the inevitable rise in costs associated with development progress cannot be avoided. At this point, with costs leading, the contribution to short-term performance is limited. However, the development of new titles is extremely important as part of the company's growth strategy and is expected to be a key factor supporting future growth.

(Author: FISCO Guest Analyst Ryoji Mogi)