FearX cut operating losses in 2025, but the bleeding isn’t stopping…

Revenue up and costs down. On paper, these are the words any company would love to hear when drawing up their yearly financials. Well, did exactly so in 2025, yet the picture doesn’t seem as rosy as it seems once you dig deeper into the numbers.

Key costs are high, borrowings continue to increase, and most importantly, the company’s equity shrank. So, how did one of the rising LCK teams perform in 2025, and what numbers are we talking about? Let’s dive deeper into their financials.

FearX is one of the ten partnered teams that take part in the LCK. Structurally, FearX is a standalone esports company that was spun off from Sandbox Network in 2020, when the team was known as SANDBOX Gaming.

Headquartered in Busan, the company that runs and owns the LCK team is controlled by 4BY4, a visual content technology company that specialises in high-performance image improvement through AI. According to the report, 4BY4 owns 60.7% of the common shares in FearX, with an additional 3.36% of preferred shares. The remaining shareholder structure is composed of a mix of investment associations, funds, and individuals.

According to the audited financial statements found on South Korea’s DART (Data Analysis, Retrieval, and Transfer), FearX reported revenues of KRW 7.03 billion (€4.03 million) in 2025, going up from KRW 6.59 billion (€3.77 million) in 2024 and marking a 6.8% YoY (year-on-year) increase.

Data shows that the overall revenue split of the team is still very concentrated in the service-led esports business, which covers 88.8% of total revenues and amounts to KRW 6.25 billion (€3.58 million). In this aspect, the growth was 10.6% YoY, which is a positive sign.

The other two revenue lines are food and beverage, which came in at KRW 673.7 million (€386,100), and product sales were KRW 110.8 million (€63,500). While product sales went up by 5.1%, the food and beverage revenues dropped by 18.9% compared to 2024.

Unlike T1, FearX are still heavily reliant on the commercial revenues, which include the fees received from the LCK franchise as well as the sponsorship and advertising revenues.

Speaking of sponsors, FearX have been operating on two different layers: the first one is focused on maintaining a core naming partner. At the start of 2025, the team extended the deal with BNK Financial Group with a new three-year deal.

The second layer is developing the broader regional network, locking the activation partnership with Lotte World Adventure Busan. With its headquarters in Busan, the team has been operating independently of Seoul, where other top LCK teams, such as T1 and Gen.G, are based, and securing deals with local companies, including Air Busan and Busan Metropolitan City. Last year, the company also secured a deal with German football club Borussia Dortmund, although it was a minor collaboration with the team’s content creators.

In an industry where operational costs are generally high, reducing them while maintaining a strong level of competitiveness can be a tough task. Somehow, FearX managed to achieve that in 2025.

Operating costs fell from KRW 10.00 billion (€5.77 million) in 2024 to KRW 8.48 billion (€4.89 million) in 2025. Paired with the slight increase in revenues, the overall operating loss amounted to KRW 1.45 billion (€828,600), nearly KRW 2 billion lower than the loss in 2024.

While the business is still bleeding substantial amounts of money, it’s getting closer to operational profitability, a challenge esports teams have been struggling with for years. T1 only achieved an operating profit in 2025, despite being one of the most successful teams in the industry.

Based on the numbers in the report, the biggest individual cost line is operating and service fees, which amounted to KRW 2.61 billion (€1.51 million) and only reduced by KRW 0.1 billion.

Salaries had a bigger decrease, going from KRW 2.17 billion (€1.25 million) to KRW 1.72 billion (€995,500). It’s worth noting that salaries cost around 24.5% of revenues, approximately a quarter.

Rent and lease expenses increased from KRW 1.36 billion (€785,800) to KRW 1.43 billion (€825,100). The depreciation dropped sharply to KRW 777.3 million (€448,700), while intangible amortization rose from KRW 486.7 million (€280,900) to KRW 559.0 million (€322,700).

In other words, despite FearX’s improvements and higher discipline around costs, the organization still faces heavy fixed commitments and a major burden to the company’s financial position.

The company still has KRW 1.87 billion (€1.07 million) in future minimum lease payments, of which KRW 900.3 million (€516,000) are due within 2026.

The discipline and conservative approach were also reflected in the cash flows. The team’s operating cash flow moved from negative KRW 2.34 billion (€1.34 million) in 2024 to negative KRW 945.6 million (€542,000) in 2025.

Most importantly, however, is the drop in investing cash outflow, which is only 6% of the amount from the previous year. Despite the company’s attempt to preserve liquidity, it still didn’t have enough to fund itself through operations alone, recording KRW 781.3 million (€447,800) in financing inflow during the year. Cash at year-end was KRW 391.5 million (€224,400).

The total assets for FearX in 2025 were KRW 12.85 billion (€7.36 million). Among the assets, the key centerpiece is none other than the LCK franchise slot, which is valued at KRW 6.63 billion (€3.82 million).

Total Liabilities amounted to KRW 8.85 billion (€5.07 million), leaving KRW 4.00 billion (€2.29 million) in equity. The latter fell from KRW 5.82 billion (€3.33 million) in 2024 as retained earnings deteriorated further to KRW -23.70 billion (€-13.58 million).

The net loss from the team in 2025 was KRW 1.83 billion (€1.05 million) in 2025, which is greater than the net loss from KRW 717.2 million (€411,100) in 2024. Operationally, however, 2025 was a stronger year for the team since 2024 included a KRW 3.32 billion (€1.90 million) debt restructuring gain that was not present in the latest financial year.

Overall, FearX appears to have established a solid continuity in its business model, with a robust commercial ecosystem in the short-medium term that encompasses both local and online activations. Paired with the improved competitive results and the rise of a superstar player like Diable, FearX have achieved a better operational result in 2025 compared to 2024.

While the team is backed by 4BY4 and can share synergies with the parent company on production, distribution, and brand amplification, the financial numbers are still far from ideal: the team faces high operating costs that the revenues cannot make up for yet, and despite the stronger cost discipline, FearX are still failing to turn a profit.

If the team were to continue their strong growth in 2026, the financial numbers will likely see improvements. Considering how FearX is performing in recent times and the increasing competition from several other LCK teams, however, the goal seems far from guaranteed.