Company: DKI
Filing Date: 2025-05-23
Form Type: DRS/A
Source: 0001641172-25-012167
Chunk: 25

Company: DarkIris Inc.
Filing Date: 2025-05-23
Form: DRS/A
Chunk 25
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 spite of any improvements or upgrades to our existing games or our efforts to offer a diversified portfolio of games. Gameplayers may not choose our games or services if our technology or game services becomes unreliable. Gameplayers may choose to play games offered by other publishers if they offer better game services or social networking features. If a game fails to gain the anticipated gameplayer acceptance and we fail to introduce additional games to maintain our gameplayer base, the phasing out of previous games could result in a prolonged period of, or permanent decrease in, our total active and paying gameplayers. If we fail to effectively schedule the initial launches of our games, our results of operation may be materially and adversely affected.

We highly rely on the in-game purchase made by our gameplayers, and therefore wemay fail to monetize our gameplayers effectively.

All of our games are free to download, and gameplayers can play with basic functions for free. We believe that this freemium model attracts a wider audience of players and increases the number of potential paying gameplayers. However, the success of this business model largely depends on whether we can attract gameplayers to play our games and whether we can successfully encourage more gameplayers to purchase in-game virtual items. We highly rely on the in-game purchase made by the gameplayers. For the years ended September 30, 2023 and 2024, we recorded revenue of approximately $7,920,461 and $3,951,074, representing 100% of our total revenue, respectively, from in-game purchase. It is possible that we may not be able to market our virtual items effectively, or we might fail to accurately identify and introduce new and popular virtual items or price them properly. In addition, this business model may cease to be commercially successful. For example, we need to make prepaid expenses to certain of game developers who develop new games for us. In the event that our new game cannot attract gameplayers, or even if new gameplayers are attracted, they may not make enough in-game purchase as we expect, and therefore our business model may not succeed, and our business may experience a shortage of available cash for operations. We cannot assure you that a sufficiently broad base of gameplayers will continue to accept this model or that a new, competing business model will not emerge.

As in line with industry norms, not all of the gameplayers who play our games are paying gameplayers. As such, in order to sustain revenue growth, we must effectively monetize our gameplayer base by converting active gameplayers