Bflysoft Achieves Profit for Two Consecutive Quarters with Q3 Surplus

Focusing 4Q Capabilities to Achieve Annual Surplus Target

Bflysoft announced achieving a profit in the third quarter on a consolidated basis, successfully recording profits for two consecutive quarters following a return to profitability in the second quarter.

Consolidated third-quarter sales increased by 10.5% year-on-year and 13.0% quarter-on-quarter to 4.5 billion KRW, and operating profit reached 260 million KRW, turning profitable compared to the same period last year and increasing by 454% compared to the previous quarter. Notably, the net profit for the third quarter was around 440 million KRW, marking the first cumulative net profit through the third quarter, raising expectations for an annual net profit for this year.

With this year's management goal set as ‘strengthening profitability and cost efficiency,’ Bflysoft has made significant internal efforts. A company representative stated, “Overall management optimization efforts, including the recent absorption merger of subsidiary Wigo Data, organizational and personnel adjustments, and cost efficiency improvements, have been effective.” In fact, the cumulative operating loss from the first to third quarter was about 300 million KRW, halving the 600 million KRW loss accumulated in the first half. Especially, through cost reduction efforts this year, the company improved losses by 1.1 billion KRW compared to the 1.5 billion KRW operating loss accumulated in the same period last year.

Looking at the sales composition, the total sales compared to the cumulative same period last year remained at a similar level, but sales of the existing core service ‘iSurfer’ grew by 7%, while low-profit service-type business decreased by 24%. This is interpreted as focusing capabilities on a portfolio aimed at strengthening profitability. Generally, service-type businesses experience significant sales fluctuations depending on the order environment, making it difficult to consider them as continuous sales. However, ‘iSurfer’ has a subscription-based revenue structure, so the sales increase in 2023 is expected to continue steadily next year. This indicates a clear structural improvement effect in both costs and sales.

Furthermore, Bflysoft expects not only continuous growth of ‘iSurfer’ but also new sales through ‘RDP LINE’ in the remaining fourth quarter. ‘RDP LINE’ is currently a solution that can resolve news data copyright issues in generative AI. Especially considering cases in the U.S. where Google and OpenAI signed news data supply contracts for AI training with The New York Times and AP News, along with various copyright litigation issues, the value of ‘RDP LINE’ in the domestic AI ecosystem is inevitably increasing. Internally, the company emphasized that through the merger process with Wigo Data, ‘RDP LINE’ plans to expand both business-wise and technologically as the next-generation core service.

A Bflysoft representative stated, “Due to current news copyright issues, detailed discussions regarding ‘RDP LINE’ are underway with several domestic mega AI companies.” They also added, “Once the first contract is signed within this year, a chain of contracts is expected, which will greatly contribute to improving fourth-quarter performance,” and emphasized, “We will focus all company capabilities on securing contracts during the remaining period and definitely achieve the annual profit target.”