NC: Profit Recovery in Filed Numbers, Shares Down 13.1% Over Three Months

Thesis

The data supports a clear earnings rebound. Trailing operating income of ₩282.9B compares with a ₩109.2B operating loss in 2024 and ₩16.1B in 2025. Net income of ₩617.7B is more than double operating income, which means non-operating items likely contributed a lot. The data does not say what those items are, so the quality of the profit is hard to judge here.

The balance sheet looks light on debt, with borrowings of ₩40.0B against cash of ₩671.1B. The market has not rewarded the recovery over three months, and the data does not explain why. No news headlines, investor flow, foreign ownership or short-balance data are available to help.

Business overview

NC is a KOSPI-listed software company founded on 1997-03-11 and listed on 2003-05-22. It has 21,544,022 listed shares and a market capitalization of about ₩4.5T. Co-CEOs are listed as 김택진 and 박병무.

Revenue peaked at ₩2.6T in 2022, then fell 30.8% in 2023, 11.3% in 2024 and 4.5% in 2025, to ₩1.5T. Trailing revenue through H1 2026 is ₩2.1T, well above the 2025 level. The data does not break revenue down by product or region.

Financial analysis

All figures below come from filed financial statements (DART).

Operating margin went from 21.7% in 2022 to 7.7% in 2023, -6.9% in 2024 and 1.1% in 2025. Trailing margin is 13.5%. Net margin is 29.5%, helped by net income exceeding operating income. Return on equity is 18.7%, up from 3.0% in 2024 and 10.8% in 2025.

Liabilities to equity is 30.2%. Cash is ₩671.1B, borrowings are ₩40.0B and trailing free cash flow is ₩212.7B. A filing on 2026-08-11 is titled as a loan decision, and an amended major sales or supply contract filing followed on 2026-08-12. The data gives no details on either.

Valuation

The current P/E is 7.3, P/B is 1.3, P/S is 2.2 and EV/EBITDA is 10.5. The dividend yield is 0.5%. The enterprise value is about ₩3.9T.

At the end of 2025 the P/E was 12.5 and the P/B 1.3, so the P/E is lower now mainly because trailing earnings are higher. The low P/E also reflects a net income figure that is much larger than operating income. Year-end multiples for earlier years are not available.

Among peers with data, Krafton has a P/E of 10.8 and a P/B of 1.2, and Hyundai Autoever has a P/E of 50.5 and a P/B of 5.1. Multiples for Netmarble, PearlAbyss and NHN are not available.

Catalysts

• The half-year report filed on 2026-08-14 confirmed the trailing profit recovery, and the next filed results will show whether the margin holds.
• Investor relations events on 2026-07-22, 2026-08-06, 2026-09-03 and 2026-10-06 show regular company communication with investors.
• A change in the largest shareholder's holdings was filed on 2026-10-08, and a 5%+ holding report followed on 2026-10-02.
• Insider shareholding reports were filed on 2026-09-17 and 2026-10-12, though the data does not show their direction or size.
• The amended major sales or supply contract filing from 2026-08-12 could matter, but its terms are not in the data.

Risks

• Revenue fell for three straight years through 2025, and the recovery rests on a limited number of reporting periods.
• Net income of ₩617.7B is far above operating income of ₩282.9B, so earnings depend on non-operating items that the data does not explain.
• The shares are down 13.1% over three months and 39.2% below the 52-week high of ₩343,500, which shows high price volatility.
• Investor flows, foreign ownership, short balance and news data are not available, so market positioning cannot be assessed.
• The low P/E of 7.3 is based on trailing profit that may not recur, given the swing from a ₩109.2B operating loss in 2024.

Closing view

The filed numbers show a real turnaround in operating profit, margins, ROE and free cash flow, supported by a balance sheet with far more cash than borrowings. The multiples are low against the company's own 2025 year-end P/E and against Krafton, but the profit base is recent and includes a large gap between operating and net income. The data cannot explain the share price weakness over three months, and it lacks flow and news information. The evidence is mixed: the improvement is strong, but its durability and quality are not yet clear from the available information.

Model estimate of fair value

The valuation model has no estimate for this company yet (not enough data, or no positive value with the base case).

Report history

1. Oct 13, 2026InitiationNC: Profit Recovery in Filed Numbers, Shares Down 13.1% Over Three Months