The AI-Assisted Game Development Era... Shift Up's Two Weapons [Weekend Money]

Expectations for lower development costs and new revenue models
Revenue and profit expected to decline this year
AI's impact and upcoming game performance remain to be seen

It takes less time to create game characters and gives users more time to spend with them. This is the change artificial intelligence (AI) will bring to the gaming industry. This shift is also shaping securities analysts' views of Shift Up, the company behind "Goddess of Victory: NIKKE" and "Stellar Blade."

On October 22, Mirae Asset Securities cited Shift Up's lean, elite development team and character intellectual property (IP) as competitive strengths. The analysis said AI could boost productivity and reduce development time and costs when incorporated into the production process, and that Shift Up is well positioned to adapt to this change.

Its first advantage is its relatively lean organization. Game companies with large existing workforces and rigid employment structures need time to turn AI adoption into actual cost savings. By contrast, Shift Up can build a workforce suited to using AI as it expands its organization. This means it has room to increase its capacity to develop new games without significantly increasing headcount.

Shift Up is researching technologies for game development through its in-house organization, "AI Labs." One area of particular interest is artwork, including characters and graphics. In subculture games, where character individuality and fandom are important, production costs account for a large share of the total. The analysis said that streamlining the process could therefore have a relatively significant effect in reducing development time and costs.

The second advantage is that the company already has characters with established fan bases. AI could go beyond serving as a tool for making games and become part of the content users enjoy. Examples include chatting with favorite characters and experiencing stories tailored to individual users. "Shift Up has built a powerful intellectual property (IP) portfolio and fandom, centered on 'NIKKE,'" said Lim Hee-seok, a researcher at Mirae Asset Securities. "Character interactions powered by generative AI will lead to greater user engagement and the creation of new revenue models."

However, optimism about AI does not mean earnings will rise immediately. Mirae Asset Securities forecasts Shift Up's revenue for 2026 at 208 billion won and operating profit at 94 billion won. These figures represent declines of 29.3% and 48.1%, respectively, from 2025. Although global revenue trends for "NIKKE" are positive, the initial revenue boost from expanding major games across platforms and regions has weakened, limiting near-term growth drivers. "The stock should be approached from a medium- to long-term perspective," Lim said. "Growth drivers will gradually emerge once specific information about upcoming titles is disclosed and their releases come into sight."

This content was produced with the assistance of AI translation services.