League of Legends Champions Korea (LCK) has reported significant financial difficulties, with net losses reaching nearly $20 million for the 2024 fiscal year, representing almost double the deficit compared to the previous year.
According to financial documents published on the South Korean Financial Supervisory Service’s disclosure portal, LCK Corporation’s net losses climbed to KRW 28.482 billion ($19.99 million) in FY2024. This marks a substantial increase from the KRW 13.2 billion ($9.3 million) losses in FY2023 and KRW 8.1 billion ($5.7 million) in FY2022, showing a concerning pattern of growing deficits.
Revenue and Operating Income Also Declining
The financial struggles extend beyond net losses, as LCK posted sales of approximately 11.4 billion won ($8 million) in 2024, representing a substantial decline of over 55% compared to the previous year’s figures.
Operating income similarly suffered, dropping from nearly 26 billion won ($18.3 million) to just over 11 billion won ($7.7 million). The company also faced increased expenses related to interest repayments and corporation tax compared to FY2023.
Multiple Factors Contributing to Financial Challenges
While LCK Corporation manages South Korea’s franchised League of Legends competition, the financial report suggests that the losses stem from multiple sources beyond just the league’s performance.
A Riot Games Korea spokesperson told South Korean media outlet DealSite that LCK’s losses were partially attributable to increased costs associated with hosting VALORANT Champions 2024 in Seoul, the game’s season-concluding world championship tournament.
Another significant factor impacting LCK’s financial performance was the restructuring of its broadcast rights agreement with Chinese platform Huya. The platform no longer holds exclusive rights in China, resulting in a reduced rights package for 2024 and 2025, decreasing from ¥300 million ($42.8 million) to ¥230 million ($32.8 million).
The financial report also confirmed that LCK remains 100% owned by Riot Games, the developer behind League of Legends and VALORANT. Riot Games itself continues to be wholly owned by Chinese conglomerate Tencent following their acquisition deal in 2011.
Broader Financial Challenges for Riot Games Korea
The financial difficulties were not limited to LCK. According to its 2024 annual report, Riot Games Korea experienced significant challenges, with net profits decreasing by over 50% to approximately 443 billion won ($311 million). The company’s operating expenses increased by 14% year-over-year, reaching 396.1 billion won ($278 million). Net income also declined by more than a third compared to the previous year, falling to under 65 billion won ($45.6 million).
An industry insider explained to DealSite that despite esports’ growing influence, the sector still lacks a sustainable revenue structure. The source noted that LCK teams are facing considerable difficulties, which in turn increases the financial burden on Riot Games Korea.