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Photo = Shift Up |
[Alpha Biz= Kim Jisun] Seoul, October 14 — Game developer Shift Up, once hailed as one of Korea’s most profitable gaming companies, is struggling in the stock market despite robust fundamentals and industry-leading profitability. Analysts cite a lack of new releases, waning momentum from existing titles, and limited shareholder returns as key reasons behind the slump.
Shift Up’s share price fell below ₩40,000, hitting a record low at ₩38,000 on Monday. The stock has halved in value since peaking above ₩80,000 after its KOSPI debut in July 2023, with its market capitalization dropping from ₩4 trillion to around ₩2 trillion in just over a year.
Strong Fundamentals, Weak Stock Performance
The company boasts an operating margin of 60.7%, the highest in the Korean gaming sector. Debt levels are minimal — its debt ratio stands at only 11.7%, and retained earnings have risen to ₩300 billion. Capital has surged from ₩180 billion in 2022 to ₩800 billion following its IPO.
Despite these strengths, stock dilution has weighed on investor sentiment. Since its listing, three rounds of additional share issuances totaling 750,000 shares — including the release of executive lock-up shares earlier this year — have added downward pressure on the stock.
Earnings Outlook Weakens
Shift Up’s flagship titles, “Goddess of Victory: Nikke” and “Stellar Blade,” are showing signs of slowing momentum.
Nikke, launched in China last May, has underperformed expectations.
Stellar Blade’s PC version, released in June, now ranks 89th in Korea and outside the global top 100 on Steam.
According to FnGuide, analysts have cut Shift Up’s Q3 forecasts to ₩73 billion in revenue and ₩47 billion in operating profit, down 35% and 31% from the previous quarter, respectively.
NH Investment & Securities lowered its price target from ₩55,000 to ₩51,000, citing weaker contributions from Nikke and Stellar Blade, as well as delays in the next major title’s launch — pushed from 2026 to 2027 or later.
Investor Sentiment and Shareholder Returns
The National Pension Service (NPS), Shift Up’s third-largest shareholder, has reduced its stake from 7% to 5% over recent months, further dampening market confidence.
Analysts say the company’s shareholder return policy remains too conservative. Despite a ₩50 billion share buyback program this year, it failed to boost valuation. Calls are growing for more aggressive measures such as dividend payments or share cancellations to restore investor trust.
“Shift Up’s balance sheet is among the strongest in the industry, but without clear growth drivers or active shareholder policies, the market is losing patience,” one analyst noted.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
