Japanese game developer KLab, known for Bleach: Brave Souls and Square Enix’s Dragon Quest Smash/Grow, recently announced its consolidated financial results for the second quarter of the fiscal year ending December 2026. As reported by GameBiz, the company turned a profit for the first time in years thanks to the outstanding performance of Dragon Quest Smash/Grow. With a 113.9% year-on-year rise in sales, KLab managed to turn around the previous quarter’s deficit of approximately $2.85 million into operating profit of $3.08 million.
On the other hand, KLab has also significantly reduced its workforce over the past year, letting go of 120 people since the second quarter of the previous fiscal year. This is a result of a mass voluntary resignation program the company launched in May 2025 in the face of continuous financial struggles. Originally, KLab had a target of 100 jobs which it had planned to cut as early as June 2025, but only 47 employees agreed to buyouts at that point. However, it seems like the company ultimately managed to surpass its initial goal by the start of the following fiscal period due to natural attrition.
In light of its deteriorating performance, KLab also entered a capital and business partnership with UAE investment firm Ultimate Classic Investment, securing over $32.7 million for game development budgets and Bitcoin and gold investments. Likely as a result of this partnership, and Ultimate Classic Investment becoming KLab’s largest shareholder, the company announced that it would establish a new, fully owned subsidiary in Dubai.
Now that KLab is finally out of the red thanks to Arab investments and the subsequent success of Dragon Quest Samsh/Grown and MHA: United Survival, it will be interesting to see if its workforce will expand now, especially considering that a new Dubai subsidiary is under way.
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