KLab Inc. (3656) AI Stock Analysis

• Market Cap: ¥6.10B
• Dividend Yield: N/A
• Average Volume (3M): 1.11M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.95
• Revenue Growth: -22.49%
• EPS Growth: -39.46%
• Country: JP
• Employees: 459
• Sector: Communication Services
• Sector Strength: 81
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): -62.73
• Shares Outstanding: 54,382,400
• 10 Day Avg. Volume: 783,260
• 30 Day Avg. Volume: 1,108,813
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

KLab Inc. exhibits significant financial struggles with declining revenues, ongoing losses, and negative cash flows. These challenges are compounded by bearish technical indicators and poor valuation metrics, leading to a low overall stock score.

KLab Inc. Business Overview & Revenue Model

Company Description

KLab Inc. is a Japanese company specialized in the development of mobile games and online entertainment content. Established in 2000, the company operates primarily in the digital entertainment sector, creating and distributing a variety of gaming applications for smartphones and tablets. KLab focuses on delivering engaging and interactive gaming experiences, often collaborating with prominent content creators and intellectual property holders to produce games based on popular franchises.

How the Company Makes Money

KLab Inc. generates revenue primarily through the development and distribution of mobile games. The company's games are typically free-to-play, utilizing a freemium model where players can download and play games at no cost, but are offered in-game purchases for virtual goods, additional content, or enhanced features. This microtransaction model is a significant revenue stream. Additionally, KLab often collaborates with well-known franchises and brands, which can drive game popularity and player engagement, thereby increasing in-game purchases. The company may also engage in partnerships and licensing agreements with other entertainment and media companies to expand its reach and bolster its revenue through shared projects and co-promotions.

KLab Inc. Financial Statement Overview

Summary

KLab Inc. faces substantial financial challenges, with declining revenues, persistent losses, and negative cash flows. Despite a strong equity base, the company's operational losses and cash flow issues pose significant risks.

Income Statement

KLab Inc. has experienced a significant decline in total revenue over the past five years, from JPY 33.95 billion in 2020 to JPY 8.31 billion in 2024. The company has also faced persistent losses, with negative net income and EBIT margins, indicating challenges in achieving profitability. The gross profit margin has decreased significantly from 20.6% in 2020 to 13.6% in 2024, reflecting cost pressures and declining sales efficiency.

Balance Sheet

The company's balance sheet shows a relatively strong equity position, with a debt-to-equity ratio of 0.21 in 2024, which indicates moderate leverage. However, equity has decreased over the years, reflecting accumulated losses. The equity ratio remains healthy at 65.7%, suggesting a strong capital structure despite the financial challenges.

Cash Flow

KLab Inc. has been generating negative free cash flow consistently, with significant operating cash outflows and no substantial capital expenditures to offset these losses. The operating cash flow to net income ratio remains below 1, indicating a lack of cash flow generation relative to reported losses. The free cash flow to net income ratio also highlights the inability to convert income into cash flow, signaling liquidity concerns.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
8.31B	10.72B	16.88B	23.90B	33.95B
	Gross Profit
1.13B	1.75B	3.02B	2.72B	6.99B
	EBIT
-1.34B	-1.22B	-59.50M	-1.11B	2.15B
	EBITDA
-1.24B	-1.21B	-33.52M	-1.92B	2.89B
	Net Income Common Stockholders
-2.78B	-1.82B	-541.92M	-3.47B	767.18M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.60B	2.21B	6.02B	4.75B	8.62B
	Total Assets
15.78B	17.75B	20.86B	18.71B	23.49B
	Total Debt
2.22B	3.18B	3.51B	1.00B	1.75B
	Net Debt
615.00M	966.07M	-2.51B	-2.81B	-6.37B
	Total Liabilities
5.41B	6.05B	7.71B	5.90B	6.91B
	Stockholders Equity
10.37B	11.71B	13.15B	12.81B	16.58B
Cash Flow		Free Cash Flow
-138.00M	-4.36B	-2.84B	-2.73B	3.03B
	Operating Cash Flow
-138.00M	-1.53B	-186.97M	-1.28B	3.98B
	Investing Cash Flow
-1.04B	-2.33B	-1.36B	-1.93B	-2.34B
	Financing Cash Flow
555.00M	-66.94M	3.54B	-1.04B	318.34M

KLab Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 113.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3656, the sentiment is Negative. The current price of 113 is below the 20-day moving average (MA) of 118.90, below the 50-day MA of 134.84, and below the 200-day MA of 171.93, indicating a bearish trend. The MACD of -5.56 indicates Negative momentum. The RSI at 35.74 is Neutral, neither overbought nor oversold. The STOCH value of 7.79 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3656.

KLab Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
9766	73 Outperform	¥2.81T	36.18	17.62%	0.76%	22.76%	50.11%
3632	71 Outperform	$93.85B	18.43	5.12%	2.89%	-17.28%	-46.49%
9684	70 Outperform	$1.00T	78.22	3.62%	0.81%	0.58%	-56.67%
2432	65 Neutral	¥404.30B	22.26	8.31%	1.07%	8.46%	―
4751	65 Neutral	¥621.65B	28.53	14.49%	1.45%	9.13%	120.85%
Sector *	59 Neutral	$13.76B	7.70	-1.87%	3.86%	2.21%	-37.55%
3656	41 Neutral	¥6.10B	―		―	-22.49%	-39.46%

KLab Inc. Corporate Events

KLab Inc. Reports April 2025 Stock Acquisition Rights Exercise

KLab Inc. announced the exercise status for its 20th series of Stock Acquisition Rights for April 2025, revealing that 25,000 rights were exercised, accounting for 21.03% of the total issued. This exercise resulted in the delivery of 2,500,000 shares, impacting the company’s stock structure and potentially influencing its market positioning and stakeholder interests.

KLab Inc. Reports March 2025 Stock Acquisition Rights Exercise Status

KLab Inc. announced the monthly exercise status of its 20th series of Stock Acquisition Rights for March 2025, with 1,330,000 shares delivered and 13,300 rights exercised, representing 11.19% of the total issued. This exercise reflects the company’s ongoing financial strategies and impacts its stock management, potentially influencing investor confidence and market positioning.

KLab Inc. Strives for Market Compliance with New Game Releases

KLab Inc. announced its progress on meeting the Tokyo Stock Exchange Prime Market’s listing maintenance criteria, revealing it has not yet met the market capitalization requirement. The company is focusing on enhancing corporate value and stock price by launching new titles, including EA SPORTS FC ™ TACTICAL, despite a delay in its release. The founder, Tetsuya Sanada, has resumed his role as Representative Director and President, aiming to drive the company towards profitability and compliance by the fiscal year ending December 2026.

KLab Inc. Announces Leadership Changes Following Shareholders Meeting

KLab Inc. announced changes in its leadership following the 25th General Shareholders Meeting. Tetsuya Sanada has been appointed as the new Representative Director and President, replacing Hidekatsu Morita, who was not reappointed. This change reflects a shift in the company’s management structure, potentially impacting its strategic direction.

KLab Inc. Announces Director Candidates for Upcoming Shareholders Meeting

KLab Inc. has announced the nomination of director candidates, which will be proposed at its upcoming 25th Annual Shareholders Meeting. This decision involves the re-election of five current directors, reflecting continuity in leadership and potentially stabilizing the company’s strategic direction.

KLab Inc. Announces Directors’ Pay Cut Amid Financial Reflection

KLab Inc. announced a reduction in directors’ remuneration following a review of their financial results for the fiscal year 2024. This decision aims to address management responsibilities and reflect on the company’s performance, potentially influencing its corporate governance and stakeholder relations.

KLab Inc. Reports Declining FY2024 Financial Performance Amidst Operational Challenges

KLab Inc. reported its financial results for the fiscal year ending December 31, 2024, showing a decline in revenue and increased losses compared to the previous year. The company faced challenges with a 22.5% decrease in revenue and increased losses, notably a loss of 2,782 million yen attributable to the owners of the parent. Despite these results, the equity ratio improved slightly to 65.6%, indicating a stable financial structure. However, the company has not disclosed its performance forecasts for the fiscal year 2025.