LCK reportedly operating at a loss as concerns around sustainability increase

The LCK is reportedly operating at a major loss over the past three years, and the situation is worsening year by year, putting serious doubts on the future of the industry.

LCK lost over 42 billion won in the last three years

According to a report by Korean media Deal Site, the League of Legends Champions Korea (LCK), the organization working behind the leading Korean esports league, has been working at a loss over the past three years, with the deficit increasing year by year.

Based on the numbers provided from the Financial Supervisory Service’s electronic disclosure system, the company recorded net losses of  ₩8.1 billion (€4.965,027) in 2022, ₩13.2 billion (€8,093,313) in 2023, and ₩28.5 billion (€17,477,539) in 2024, respectively. The total deficit over the last three years has increased to ₩42.7 billion (€26,185,646), with losses more than doubling in the last year.

According to a spokesperson from Riot Korea, one of the reasons behind the increased costs in 2024 was hosting the VALORANT Champions Tour (VCT) on home soil in Seoul.

Even more concerning is the decrease in revenues, which dropped sharply in the last year. The LCK only made ₩11.4 billion (€6,987,541) in the last financial year, going down by nearly 60% compared to the numbers recorded in 2022, which were ₩27.9 billion (€17,101,087).

Regardless, the fact that the LCK is struggling to be profitable and sustainable, despite being one of the most popular leagues across the entire world, is a major worrying sign for the ecosystem.

What is causing the lack of profitability and financial struggles within the LCK?

The LCK is known for having one of the most extensive schedules in the esports calendar, with official matches taking place five days a week during the regular season, as well as all the playoff brackets to determine the top teams going to international events such as the upcoming Mid-Season Invitational and the Esports World Cup.

As tournament organizers, the LCK has several fixed expenses to sustain, including broadcast equipment, production costs, and all human resources to function properly. While those costs keep increasing due to the overall macroeconomic environment, the league is struggling to generate more revenues as it mainly depends on ticket sales, sponsorships, and broadcasting rights, without further diversifying its revenues.

While Riot Games Korea monopolized esports rights in the country and opened up the LoL Park as the central hub for the LCK and its operations, the financial burden caused by the high fixed-cost structure is now amounting to increasing losses year by year. In addition, with Riot Games managing global sponsorship deals and media rights directly, the LCK is put in a disadvantageous position in terms of revenue sharing.

Despite the league’s effort to improve its revenue model by adopting a franchise system back in 2021 to grant more stability to esports teams competing in the league, the revenue distributed is becoming yet another burden for the LCK, as it puts more financial strain.

Chinese streaming platform Huya, which held exclusive rights in China since 2018 for the Korean League, did not renew its deal in 2024, further impacting the generation of revenues for the league. The Chinese company was also impacted by declining live-streaming and sub-licensing revenues, and it reduced licensing fees for LPL from the initial 300 million RMB (€36,182,378) to 230 million RMB (€27,739,823) for 2024 and 2025.

The whole esports ecosystem is struggling… and not just the organizers

Esports teams are also under pressure due to the struggles in finding a profitable and sustainable business model. According to Deal Site, the LCK cut a third off franchise entry fees for teams, around ₩33 billion (€20,228,693) out of the ₩102 billion (€62,525,051). Moreover, teams were provided with an additional ₩13 billion (€7,970,276) support as well as a 50% revenue share from league income. Even if it may have helped teams stay afloat, these ended up being increased costs for the LCK.

Earlier last month, current world champion T1 reported a loss of €5,4 million (₩8.8bn) for the 2024 financial year, further showcasing the difficulties of the industry to turn a profit. Gen.G previously stated that the team couldn’t turn a profit, according to Gen.G CEO Arnold Hur, back in early 2023.

At the moment, only the French esports team Karmine Corp has claimed profitability for the second year running, thanks to a surplus made on player transfers and revenue growth driven by higher merchandise sales and brand collaborations. Before them, G2 was one of the top esports teams that were able to generate a positive EBITDA of €1.37 million during the 2021 FY.

The currency conversion in the article has been calculated with the exchange rate as of April 24, 2025, at €1 = ₩1,630 and €1 = 8.29 RMB.