Gree Inc. (3632): Can a shift to VR and digital marketing save this sinking company?

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Summary:

• Company in Transition: Gree Inc., once a dominant force in mobile gaming, is now grappling with the realities of a rapidly changing digital landscape. The company’s strategic pivot towards virtual reality (VR) and digital marketing marks a significant departure from its former self, but this transition comes with substantial risks.

• Financial Setbacks: Recent earnings reports have forced a drastic downward revision in profit forecasts, highlighting the company’s struggles with delayed game releases and the burden of heavy upfront investments in new ventures.

• Opportunity vs. Risk: Gree’s ambitious forays into VR and digital marketing could unlock new revenue streams, but the company's past successes in gaming provide little assurance that these new ventures will pay off. The risk of failure looms large, even as the potential for growth remains tantalizingly close.

• Market Sentiment: Despite a more attractive P/E ratio, my cautious outlook suggest that the stock may face continued downward pressure, reflecting the market's skepticism about Gree’s ability to deliver on its ambitious plans.