NEXON Co., Ltd. Just Missed Earnings - But Analysts Have Updated Their Models

As you might know, NEXON Co., Ltd. (TSE:3659) last week released its latest quarterly, and things did not turn out so great for shareholders. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at JP¥136b, statutory earnings missed forecasts by an incredible 34%, coming in at just JP¥32.55 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for NEXON

Following the latest results, NEXON's 15 analysts are now forecasting revenues of JP¥523.3b in 2025. This would be a solid 16% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 118% to JP¥160. In the lead-up to this report, the analysts had been modelling revenues of JP¥534.3b and earnings per share (EPS) of JP¥166 in 2025. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the JP¥3,611 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values NEXON at JP¥5,500 per share, while the most bearish prices it at JP¥2,500. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of NEXON'shistorical trends, as the 13% annualised revenue growth to the end of 2025 is roughly in line with the 13% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.7% per year. So it's pretty clear that NEXON is forecast to grow substantially faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for NEXON. They also downgraded NEXON's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target held steady at JP¥3,611, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for NEXON going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 3 warning signs we've spotted with NEXON .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.