Exhibit 99.2

2016 Annual Business Report

Table of Contents

1. Business Overview

(1) Business Results and Financial Statements for the Past Three Fiscal Years (2014 – 2016)

2. Company Overview

(1) Registered Purpose of the Company

(2) Description of Primary Business

(3) Problems Confronting the Company

(4) Business Offices and Game Development Facilities

(5) Stock

(6) Debenture

(7) Major Shareholders

(8) Investment in Other Companies

(9) Directors Holding Concurrent Positions

(10) Material Transactions with Related Parties

(11) Significant Creditors

(12) Employees

(13) Directors and Auditors

(14) Material Events after the End of Fiscal Year 2016

3. Non-Consolidated Financial Statements as of and for the fiscal years ended December 31, 2016 and 2015

(1) Balance Sheets

(2) Income Statements

(3) Statements of Disposition of Accumulated Deficit

(4) Statements of Changes in Equity

(5) Statements of Cash Flows

(6) Notes to Non-Consolidated Financial Statements

1. Business Overview

(1) Business Results and Financial Statements for the Past Three Fiscal Years (2014 – 2016)

(In Korean Won)

Category	2016			2015			2014
Current assets		48,498,182,583			38,763,539,126			43,125,471,781
• Quick assets		48,498,182,583			38,763,539,126			43,125,471,781
Non-current assets		3,677,807,015			4,999,247,501			16,984,379,227
• Investment asset		1,702,300,453			3,458,637,535			6,465,572,045
• Tangible asset		320,560,073			353,333,606			474,922,737
• Intangible asset		132,873,092			225,643,240			8,906,509,785
• Other non-current asset		1,522,073,397			961,633,120			1,137,374,660
Total assets		52,175,989,598			43,762,786,627			60,109,851,008
Current liabilities		16,379,370,612			4,216,026,056			5,835,639,084
Non-current liabilities		3,797,532,276			6,861,637,783			5,535,434,654
Total liabilities		20,176,902,888			11,077,663,839			11,371,073,738
Common stock		3,474,450,000			3,474,450,000			3,474,450,000
Additional paid-in capital		28,204,665,680			43,930,773,576			63,960,606,495
Retained earnings (Accumulated deficit)		(736,599,294	)		(15,726,107,896	)		(20,029,832,919	)
Accumulated other comprehensive income and loss		1,056,570,324			1,006,007,108			1,333,553,694
Total equity		31,999,086,710			32,685,122,788			48,738,777,270
Revenues		34,960,527,849			16,282,357,147			17,339,523,031
Operating income (loss)		5,689,492,355			(8,711,508,289	)		(9,000,124,182	)
Income (loss) before income tax		2,483,304,521			(14,461,283,852	)		(12,572,306,743	)
Net income (loss)		(736,599,294	)		(15,726,107,896	)		(20,029,832,919	)

2. Company Overview

(1) Registered Purpose of the Company

1) Software consulting, development and supply

2) Development and sales of software and CD

3) Information-technology-related software development

4) Production, development, distribution, sales and consulting of digital contents, including game software, as well as corresponding licensing

5) Online network game services

6) Applied package-related software development

7) Production and sales of computer programs

8) Import and export of software

9) E-commerce

10) Character development business

11) Animation business

12) Real estate leasing

13) Service-area restaurant business

14) Media-related business

15) Printing and publication

16) Record & video production and distribution

17) Any other businesses incidental to the above businesses

(2) Description of Primary Business

Gravity Co., Ltd. (the “Company”) is the developer of Ragnarok Online, an MMORPG, which was launched in August 2002 and is commercially offered in 80 markets worldwide, including Korea, Japan, Taiwan, Thailand, Southeast Asia, the United States and Europe as of December 31, 2016. Requiem, which was commercially launched in October 2007, is currently serviced all over the world. In March 2012, the Company released Ragnarok Online II, which is currently serviced worldwide except China.

Having strong global network and success from Ragnarok Online, the Company is expanding its business areas from online game development and publishing to cultural contents business based on various platforms, such as development of games for smartphones, console and IPTV, and animation and game character merchandising.

In addition, in order to strengthen its presence in the overseas markets, the Company has subsidiaries in the United States and Japan. The Company also has subsidiaries in Korea, such as NeoCyon, Inc. and Gravity Games Corp. In November 2016, the company established a branch office in Taiwan.

(3) Problems Confronting the Company

Since the Company operates in a highly competitive industry, the Company is making every effort to enhance its development capacity and to maintain and increase its market share in overseas markets to preserve its competitive advantage.

Due to its high dependence on Ragnarok Online, the Company is in need of diversified revenue structure, global market expansion and new business initiatives for sustainable revenue growth. The Company is doing its best to build its next game line-up through enhancing mobile game business.

(4) Business Offices and Game Development Facilities

Classification	Location
Head Office	(Nuritkum Square R&D Tower) 15F, 396 World Cup buk-ro, Mapo-gu, Seoul 121-795, Korea
Branch Office	12F.-1, No.36-10 ,Sec.1, Fuxing S.Rd., Da’an Dist., Taipei City 106
Game Development Facilities	(Nuritkum Square R&D Tower) 15F, 396 World Cup buk-ro, Mapo-gu, Seoul 121-795, Korea

(5) Stock

1) Total number of shares

(As of December 31, 2016)

Total number of shares authorized	Total number of shares issued	Total number of shares unissued
40,000,000 shares	6,948,900 shares	33,051,100 shares

2) Type of Stock issued (Par value per share: KRW 500)

(As of December 31,2016)

Type	Number of shares	Total par value	%
Registered common stock	6,948,900 shares	KRW 3,474,450,000	100%

(6) Debenture: None.

(7) Major Shareholders

(As of December 31, 2016)

Shareholder	Shares owned		%		Transaction with the Company
GungHo Online Entertainment, Inc.		4,121,737		59.31		*
Others		2,827,163		40.69		—
Total		6,948,900		100.00		—

* Refer to “(10) Material Transactions with Related Parties.”

(8) Investment in Other Companies

(As of December 31, 2016)

Companies					Relationship with the Company
Name	Location	Common Stock		Main business	Shares owned		%			Relationship
Gravity Interactive, Inc.	California, US	USD	5,040,000	Gaming Service		100,000		100.00	%	Subsidiary
Gravity Entertainment Corp.	Tokyo, Japan	JPY	167,850,000	Animation making/service		1,000		100.00	%	Subsidiary
NeoCyon, Inc.	Seoul, Korea	KRW	964,005,000	Mobile game development		185,301		96.11	%	Subsidiary
Gravity Games Corp.	Seoul, Korea	KRW	1,134,730,000	Online game development		194,035		85.50	%	Subsidiary

(9) Directors Holding Concurrent Positions

Name	Company
	Name	Position	Responsibility
Hyun Chul Park	Gravity Co., Ltd.	CEO	Overall management
	NeoCyon, Inc.	Executive Director	Chief Operating Officer
	Gravity Games Corp.	Executive Director	—
	Gravity Interactive, Inc.	Executive Director	—
Yoshinori Kitamura	Gravity Co., Ltd.	Executive Director	Chief Operating Officer
	Gravity Interactive, Inc.	CEO	Overall management
	Gravity Entertainment Corp.	CEO	Overall management
	NeoCyon, Inc.	CEO	Overall management
	Gravity Games Corp.	Executive Director	—

(10) Material Transactions with Related Parties

①  Sales and purchases

(In thousands of Korean Won)

Nature	Related companies	2016				2015
		Sales		Purchases		Sales		Purchase
Parent company	GungHo Online Entertainment, Inc.		8,586,568		6,302		6,815,604		5,991
Subsidiaries	Gravity Interactive, Inc.		522,034		—		688,866		684
	NeoCyon. Inc.		517,932		2,678,066		539,996		615,390
	Gravity Games Corp.		8,348		—		22,871		—
	Total		9,634,882		2,684,368		8,067,337		622,065

②  Receivables and Payables

- 2016

(In thousands of Korean Won)

Nature	Related companies	Receivables						Payables
		Accounts receivable		Loans		Other receivable		Accounts payable		Other payable
Parent company	GungHo Online Entertainment, Inc.		756,121		—		35,912		3,024,317		—
Subsidiaries	Gravity Interactive, Inc.		2,715,048		3,542,120		96,646		6		—
	NeoCyon. Inc.		40,667		—		1,414,619		61,600		120,535
	Gravity Games Corp.		63		1,972,000		1,900,930		—		—
	Total		3,511,899		5,514,120		3,448,107		3,085,923		120,535

- 2015

(In thousands of Korean Won)

Nature	Related companies	Receivables						Payables
		Accounts receivable		Loans		Other receivable		Accounts payable		Other payable
Parent company	GungHo Online Entertainment, Inc.		759,032		—		37,375		2,880		4,699,300
Subsidiaries	Gravity Interactive, Inc.		2,274,997		2,381,300		9,000		6		—
	NeoCyon. Inc.		42,598		—		79,869		61,600		120,535
	Gravity Games Corp.		68		1,972,000		1,900,930		—		—
	Total		3,076,695		4,353,300		2,027,174		64,486		4,819,835

(11) Significant Creditors: The Company had no significant creditors as of December 31, 2016.

(12) Employees

(As of December 31, 2016)

Category	Directors & Officers	Developers	Marketing/Operating	Finance/Administration	Total
Employees	8	98	48	31	185

(13) Directors and Auditors

Name	Position	Main work	Transaction with the Company
Hyun Chul Park	CEO	Chief Executive Officer	—
Yoshinori Kitamura	Executive Director	Chief Operating Officer	—
Kazuki Morishita	Executive Director	—	—
Kazuya Sakai	Executive Director	—	—
Jong Gyu Hwang	Independent Director	Member of audit committee	—
Doo Hyun Ryu	Independent Director	Member of audit committee	—
Jung Yoo	Independent Director	Member of audit committee	—

(14) Material Events after the end of fiscal year 2016: None.

3. Non-Consolidated Financial Statements as of and for the fiscal year ended December 31, 2016 and 2015

(1) Balance Sheets

GRAVITY CO., LTD.						(In Korean Won)
	2016				2015
Assets
Current Assets				48,498,182,583				38,763,539,126
Quick assets				48,498,182,583				38,763,539,126
Cash and cash equivalents		13,995,265,268				22,153,897,708
Short-term financial instruments		21,500,000,000				11,500,000,000
Trade receivable		11,844,092,956				5,379,025,009
Allowance for doubtful accounts		(2,353,715,846	)			(1,737,852,201	)
Short-term loans receivables		3,333,336				2,222,216
Allowance for doubtful accounts		—				—
Other receivable		1,381,175,678				485,106,688
Allowance for doubtful accounts		(330,450,737	)			(332,509,371	)
Accrued income		363,549,358				217,538,745
Allowance for doubtful accounts		(115,151,736	)			(115,151,736	)
Advance payments		2,140,217,133				1,509,926,000
Allowance for doubtful accounts		(1,500,000,000	)			(1,500,000,000	)
Prepaid expenses		1,001,152,140				563,874,851
Prepaid income taxes		568,715,033				637,461,217
Non-current Assets				3,677,807,015				4,999,247,501
Investment assets				1,702,300,453				3,458,637,535
Equity method investments		1,698,967,125				3,458,637,535
Long-term loans receivables		6,717,453,328				5,553,300,000
Allowance for doubtful accounts		(6,714,120,000	)			(5,553,300,000	)
Property and equipment				320,560,073				353,333,606
Computer and equipment		4,288,607,714				5,567,224,307
Accumulated depreciation		(4,132,870,607	)			(5,381,652,836	)
Furniture and fixtures		633,990,395				619,614,408
Accumulated depreciation		(612,587,356	)			(609,411,025	)
Leasehold improvements		1,005,678,971				963,697,319
Accumulated depreciation		(862,259,044	)			(806,138,567	)
Intangible assets				132,873,092				225,643,240
Capitalized R&D cost, net		—				—
Software		43,907,108				116,917,359
Other intangible assets, net		88,965,984				108,725,881
Other non-current assets				1,522,073,397				961,633,120
Leasehold deposits		920,996,000				923,243,120
Long-term prepaid expenses		557,587,854				10,000,000
Other non-current assets		43,489,543				28,390,000
Total assets				52,175,989,598				43,762,786,627
Liabilities
Current liabilities				16,379,370,612				4,216,026,056
Accounts payable		8,784,093,615				1,804,350,812
Advances received		176,385				98,061
Withholdings		131,470,281				112,606,500
Deferred income		7,295,025,308				2,179,175,863
Income tax payable		168,605,023				119,794,820
Non-current liabilities				3,797,532,276				6,861,637,783
Long-term deferred income		3,466,707,576				6,530,813,083
Asset retirement obligation		210,290,000				210,290,000
Leasehold deposit received		120,534,700				120,534,700
Total liabilities				20,176,902,888				11,077,663,839

	2016					2015
Equity
Share capital				3,474,450,000					3,474,450,000
Common shares		3,474,450,000					3,474,450,000
Capital surplus				28,204,665,680					43,930,773,576
Paid-in capital in excess of par value		26,079,529,294					41,805,637,190
Other capital surplus		2,125,136,386					2,125,136,386
Accumulated other comprehensive income and loss				1,056,570,324					1,006,007,108
Net accumulated comprehensive income of equity method investees		1,180,435,364					1,180,435,364
Net accumulated comprehensive loss of equity method investees		(148,940,913	)				(174,428,256	)
Cumulative effect of foreign currency translation		25,075,873					—
Accumulated deficit				(736,599,294	)				(15,726,107,896	)
Undisposed accumulated deficit		(736,599,294	)				(15,726,107,896	)
Total equity				31,999,086,710					32,685,122,788
Total liabilities and equity				52,175,989,598					43,762,786,627

(2) Income Statements

GRAVITY CO., LTD.							(In Korean Won)
	2016					2015
Revenues				34,960,527,849					16,282,357,147
Online games-subscription revenue		18,905,149,658					3,674,550,704
Online games-royalties and license fees		13,163,798,205					11,577,677,453
Mobile games		2,694,766,775					882,522,716
Character merchandising, animation and other revenue		196,813,211					147,606,274
Cost of revenues				14,054,532,171					13,707,528,886
Cost of revenues-games		14,054,532,171					13,707,528,886
Gross profit				20,905,995,678					2,574,828,261
Selling and administrative expenses				15,216,503,323					11,286,336,550
Salaries		3,571,340,129					2,936,738,260
Severance benefits		360,805,680					196,631,640
Employee benefits		528,078,924					542,938,212
Transportation		217,295,572					100,047,366
Entertainment		62,583,274					43,194,142
Communication		78,813,956					75,974,439
Utilities		288,539					—
Taxes and dues		173,868,782					181,755,974
Depreciation		85,182,805					114,679,595
Rent		563,896,868					377,097,066
Insurance premium		114,727,011					107,741,431
Vehicles maintenance		2,411,000					4,391,000
Freight expenses		2,304,707					1,873,643
Repairs expenses		3,321,000					3,350,000
Training expenses		320,000					1,315,000
Books & subscription		4,433,250					1,923,569
Office supplies		25,430,015					24,568,942
Commission paid		5,133,316,919					2,165,509,531
Advertising		2,184,924,916					1,342,772,644
Research and development		2,096,506,908					3,073,669,887
Bad debt		(40,338,475	)				(84,557,335	)
Amortization of intangible assets		46,991,543					74,721,544
Operating Income (loss)				5,689,492,355					(8,711,508,289	)
Non-operating income				1,991,686,855					2,240,847,859
Interest income		630,259,632					718,659,176
Gain on foreign currency translation		254,213,988					139,522,983
Gain on foreign exchange transactions		810,879,758					402,788,878
Gain on disposal of property and equipment		1,385,182					6,529,170
Gain on disposal of intangible assets		1,085,902					—
Gain on disposal of equity-method investments		—					624,043,873
Other income		293,862,393					349,303,779
Non-operating expenses				5,197,874,689					7,990,623,422
Loss on foreign currency translation		747,888,981					186,390,178
Loss on foreign exchange transactions		841,803,733					128,900,533
Loss on valuation of equity-method investments		3,600,121,239					3,008,605,907
Loss on impairment of intangible assets		4,783,789					4,638,954,929
Other losses		3,276,947					27,771,875
Income (loss) before income tax				2,483,304,521					(14,461,283,852	)
Income tax expense				(3,219,903,815	)				(1,264,824,044	)
Net loss				(736,599,294	)				(15,726,107,896	)
Loss per share*
Basic and diluted				(106	)				(2,263	)

* Each ADS represents two shares of our common stock. Therefore, loss per ADS is two loss per share.

(3) Statements of Disposition of Accumulated Deficit

GRAVITY CO., LTD.					(In Korean Won)
	2016				2015
	Confirmed disposition date: March 30, 2017				Confirmed appropriation date: March 25, 2016
Accumulated deficit before disposition (retained earnings before appreciation)				736,599,294				15,726,017,896
Unappropriated retained earnings carried over from prior year		—				—
Net loss		(736,599,294	)			(15,726,017,896	)
Disposition of accumulated deficit				736,599,294				15,726,017,896
Transfer from capital surplus		736,599,294				15,726,017,896
Undisposed accumulated deficit (unappropriated retained earnings) carried forwards to subsequent year				—				—

(4) Statements of Changes in Equity

GRAVITY CO., LTD.									(In Korean Won)
	Capital Stock		Capital Surplus			Accumulated Other Comprehensive Income and Loss			Retained Earnings			Total
Balance at January 1, 2015		3,474,450,000		63,960,606,495			1,333,553,694			(20,029,832,919	)		48,738,777,270
Net loss		—		—			—			(15,726,107,896	)		(15,726,107,896	)
Disposition of accumulated deficit		—		(20,029,832,919	)		—			20,029,832,919			—
Changes in equity-method investees with accumulated comprehensive income		—		—			(622,306,435	)		—			(622,306,435	)
Changes in equity-method investees with accumulated comprehensive loss		—		—			294,759,849			—			294,759,849
Balance at December 31, 2015		3,474,450,000		43,930,773,576			1,006,007,108			(15,726,107,896	)		32,685,122,788
Balance at January 1, 2016		3,474,450,000		43,930,773,576			1,006,007,108			(15,726,107,896	)		32,685,122,788
Net loss		—		—			—			(736,599,294	)		(736,599,294	)
Disposition of accumulated deficit		—		(15,726,107,896	)		—			15,726,107,896			—
Changes in equity-method investees with accumulated comprehensive income		—		—			25,487,343			—			25,487,343
Changes in cumulative effect of foreign currency translation		—		—			25,075,873			—			25,075,873
Balance at December 31, 2016		3,474,450,000		28,204,665,680			1,056,570,324			(736,599,294	)		31,999,086,710

(5) Statements of Cash Flows

GRAVITY CO., LTD.						(In Korean Won)
	2016					2015
Cash flows from operating activities				3,068,272,859					(4,149,181,974	)
Net loss		(736,599,294	)				(15,726,107,896	)
Addition of expenses not involving cash outflows		4,476,656,440					11,980,914,145
Depreciation		146,806,186					256,604,158
Amortization of intangible assets		89,736,314					4,144,303,761
Bad debt (reversal of bad debt)		(40,338,475	)				(84,557,335	)
Loss on foreign currency translation		675,547,387					17,002,725
Loss on valuation of equity-method investments		3,600,121,239					3,008,605,907
Loss on impairment of intangible assets		4,783,789					4,638,954,929
Deduction of revenues not involving cash inflows		(246,873,705	)				(768,463,333	)
Gain on foreign currency translation		244,402,621					137,890,290
Gain on disposal of property, plant and equipment		1,385,182					6,529,170
Gain on disposal of intangible assets		1,085,902					—
Gain on valuation of equity-method investments		—					624,043,873
Changes in assets and liabilities arising from operating activities		(424,910,582	)				364,475,110
Increase in trade receivable		(6,320,855,044	)				(1,568,321,290	)
Decrease (increase) in other receivable		(796,664,336	)				392,317,605
Decrease (increase) in accrued income		(146,010,613	)				69,922,132
Decrease (increase) in advance payments		(659,717,221	)				1,888,245
Increase in prepaid expenses		(363,039,025	)				(28,292,311	)
Decrease in prepaid income taxes		68,746,184					58,453,693
Decrease (increase) in long-term prepaid expenses		(621,826,118	)				181,770,000
Increase in other payable		1,605,680,480					122,379,048
Increase in withholdings		18,863,781					2,699,241
Increase (decrease) in deferred income		5,556,808,603					(1,070,674,868	)
Increase in income tax payable		48,810,203					7,053,314
Increase in long-term deferred income		1,194,235,335					2,192,513,473
Increase in leasehold deposits received		—					2,735,211
Increase in advances receipts		78,324					31,617
Increase in other non-current asset		(10,021,135	)				—
Cash flows from investing activities				(11,251,626,232	)				2,207,875,663
Cash inflows from investing activities		43,017,698,780					52,013,299,641
Decrease in short-term investments		43,000,000,000					52,000,000,000
Collection of short-term loans receivable		5,555,552					6,666,640
Disposal of property and equipment		1,385,182					4,542,091
Disposal of vehicles		—					2,090,910
Disposal of software		8,510,926					—
Decrease in leasehold deposits		2,247,120					—
Cash outflows from investing activities		(54,269,325,012	)				(49,805,423,978	)
Increase in short-term investments		53,000,000,000					49,000,000,000
Increase in short-term loans receivable		—					328,110,000
Increase in long-term loans receivable		1,170,820,000					230,050,000
Acquisition of computer and equipment		54,392,842					133,367,631
Acquisition of furniture and fixtures		17,303,219					1,751,227
Acquisition of leasehold improvement		26,269,452					—
Acquisition of intangible assets		539,499					96,450,000
Increase in guarantee deposits		—					15,695,120
Cash flows from financing activities				—					—
Cash inflows from financing activities		—					—
Cash outflows from financing activities		—					—
Adjustments in cash from foreign currency translation of foreign branch				24,720,933					—
Increase(decrease) in cash and cash equivalents				(8,158,632,440	)				(1,941,306,311	)
Cash and cash equivalents at beginning of year				22,153,897,708					24,095,204,019
Cash and cash equivalents at end of year				13,995,265,268					22,153,897,708

(6) Notes to Non-Consolidated Financial Statements

* For the notes to the non-consolidated financial statements, please refer to the condensed English translation version of the Company’s KAS-NPE non-consolidated financial statements as of and for the years ended December 31, 2016 and 2015 and the independent auditor’s report to be submitted to the United States Securities and Exchange Commission on Form 6-K on April 7, 2017.