Stock Quote
Quarterly Reports (Japan GAAP)
This page contains materials used in earnings presentations and earnings calls with securities analysts and institutional investors. To ensure the fair disclosure of information to investors and shareholders worldwide, this page includes presentation materials, summaries of presentations by speakers and summaries of question-and-answer sessions. Investors can also view Japanese-language webcasts of Capcom’s earnings presentation.
Capcom’s earnings presentation for securities analysts and institutional investors is held following its fiscal year-end earnings announcement, while earnings calls are held quarterly.
FY2024
-
FY24 Q3 Financial Results
-
Financial Results
PDFHTML format -
Financial Results Presentation
PDFHTML format
Related information -
-
FY24 Q2 Financial Results
-
Financial Results
PDFHTML format -
Financial Results Presentation
PDFHTML format -
Question and Answer Summary
PDFHTML format
Related informationQuestion and Answer Summary
- Could you provide an overview of how business segments performed for the first half of the fiscal year?
- The Digital Contents business has generally progressed smoothly. Although unit sales for new titles fell slightly short of our plan, the performance of catalog titles (excluding those released in the previous fiscal year) has steadily increased year over year. The Arcade Operations business saw growth in existing stores as they were utilized as cooling shelters during hot weather, resulting in increased revenue and profit. In the Amusement Equipments business, we launched two new models and sold 17,000 units as planned, benefiting from cost reductions through the procurement of common components. Other Businesses performed well due to an increase in collaboration projects featuring our characters in games from other companies.
- How do you expect the unit price of catalog titles to trend in the second half of the fiscal year?
- Because new titles released in the previous year transition to catalog titles, typically there are not significant fluctuations in price on an annual basis. We do not anticipate major changes in the second half of this fiscal year either.
- Digital license revenue has already exceeded the full-year plan; do you expect any additional revenue here going forward?
- We have incorporated only projects with a high degree of visibility at the planning stage. As such, depending on the situation there is a possibility of more in the second half of the fiscal year.
- What are your expectations for Monster Hunter Wilds?
- We have just started an open beta test today, October 29. Being the latest installment in the Monster Hunter series, we aim to steadily increase sales.
- How much asset impairment was booked in the first half of this fiscal year? Also, were there any one-time expenses aside from impairments?
- There were no impairments in the first half of the fiscal year. Additionally, we have recorded approximately 910 million yen as non-operating expenses related to Expo 2025 Osaka, Kansai, Japan.
- In the second quarter (three months), unit sales volume increased compared to the same period last year, but revenue and profit decreased. What is the reason for this?
- The primary reason is that the major new title Street Fighter 6, released in June of last year, contributed significantly to performance in the second quarter of the previous year, while this year’s new titles were relatively smaller in scale.
- Can you tell us about the sales strategies for Monster Hunter Wilds?
- We have been implementing promotions to enhance overall awareness of the Monster Hunter series and connect it to Monster Hunter Wilds. This year, we are focusing more than ever on real-world events like game shows globally, and we are monitoring user trends during the open beta test while accelerating promotions to boost sales.
- With major titles upcoming, there seems to be a high level of work-in-progress for game software. Is this within management’s control?
- While Monster Hunter Wilds constitutes a large portion of the work-in-progress, a certain amount will be recognized as cost of sales after its release, so we are not currently concerned about the increase in the work-in-progress balance.
- Four new titles were released in the second quarter; can you provide insights on their performance? In particular, can we expect Kunitsu-Gami: Path of the Goddess and Dead Rising Deluxe Remaster to develop into series?
- Kunitsu-Gami: Path of the Goddess received high ratings on review aggregation sites before its release and was well received by users, but it did not meet our planned sales figures. We plan to continue promoting it. Dead Rising Deluxe Remaster is selling as planned, and we have a physical version scheduled for release in November, so we will continue our promotional efforts. Ace Attorney Investigations Collection and Marvel vs. Capcom Fighting Collection: Arcade Classics are also progressing in-line with plans, with the latter’s physical version is coming in November, so we will strengthen our sales efforts.
- After the release of Monster Hunter Wilds in February next year, it will likely continue to contribute as a catalog title next fiscal year. What measures do you plan to implement to maintain double-digit operating profit growth next year?
- The sales performance of Monster Hunter Wilds will be a factor, but we are also considering the release of major titles next year. Additionally, achieving our medium- to long-term goal of 100 million units sold annually and expanding catalog titles to potential users worldwide will be key challenges as we aim for double-digit profit growth next year.
- Selling, general and administrative expenses have increased by about 1 billion yen compared to the first quarter; is this related to event costs like game shows?
- This increase is due to promotional expenses for events, and we expect a slight increase in the second half of the fiscal year due to promotions for Monster Hunter Wilds.
- The new title Kunitsu-Gami: Path of the Goddess did not meet expectations; are there any concerns regarding the promotion of Monster Hunter Wilds?
- We recognize that while Kunitsu-Gami: Path of the Goddess is a completely new IP, it did not have sufficient pre-launch promotion for generating buzz and increasing awareness. We believe this will not impact the promotion of Monster Hunter Wilds, as it is part of a series with a proven track record.
- In aiming for sales volume targets for new titles, how does the market environment for Monster Hunter Wilds differ from that of Monster Hunter: World?
- There are differences in supported platforms, but we believe the launch environment is not very different. While we have incorporated significant contributions from Monster Hunter Wilds into our sales volume plan, we believe we can still achieve our profit targets regardless of whether we meet the overall planned sales volume for new titles this fiscal year.
- Is the management goal of 10% increased annual operating profit based on expected foreign exchange impacts?
- We set the growth target of 10% increased annual operating profit regardless of foreign exchange impacts.
- Which regions are seeing growth in the number of catalog titles?
- Unit sales in the Monster Hunter series is growing in the Asian region in particular.
- Can you provide updates on digital sales in each region and your pricing strategies for emerging markets?
- We analyze sales volumes by region and then implement strategies, but particularly in emerging markets, it takes time to see results. As such, we are working to enhance brand awareness for our titles in each region. Notably, new titles tend to perform well in developed markets, while catalog titles are growing in emerging markets in line with regional price sensitivity.
- Considering the sales performance for new titles like Kunitsu-Gami: Path of the Goddess and catalog titles such as Dragon’s Dogma 2, how will you adjust your marketing strategies going forward?
- Recently, there has been a trend in the industry of spending large amounts on advertising and promotions just before and after release to kickstart initial sales, but we have not traditionally used such methods. We calculate the costs for promotions based on expected performance and take a long-term approach to sales. On average, we can recover development costs within about one to one and a half years after release, so even if we lower the selling price afterward, once costs are recouped we expect profit margins of 80-90%. Our marketing approach remains unchanged.
- Can you explain the impact of foreign exchange in the first half of the fiscal year?
- Compared to our initial plan, we experienced a positive impact of 2 to 3 billion yen on an operating profit basis. Note that we have intentionally set conservative exchange rate assumptions. In a weak yen environment, we take a comprehensive approach to management and implement agile management measures to take advantage of windfalls after considering market conditions. In line with this, we aim to achieve our announced annual operating profit target of 64 billion yen for the full fiscal year.
-
-
FY24 Q1 Financial Results
-
Financial Results
PDFHTML format -
Financial Results Presentation
PDFHTML format -
Question and Answer Summary
PDFHTML format
Related informationQuestion and Answer Summary
- How did each business segment perform against plans in the first quarter?
- All business segments outperformed our internal plan. Particularly, the Arcade Operations and Amusement Equipments businesses contributed significantly to profit.
- How did unit sales in the Digital Contents business progress compared to your plan?
- Although overall unit sales slightly fell short of plans, catalog titles released two years ago or earlier showed steady growth compared to the previous year and we made a solid start in relation to full-year guidance.
- It seems that growth of catalog title unit sales slowed despite discount promotions. How will you address this?
- We do not believe there is an issue because looking at catalog titles released two years ago or earlier, average revenue per unit has exceeded both the previous year’s level and our plan. We will continue our efforts to find appropriate price ranges for emerging and developing countries to further drive sales as one future measure.
- Is inbound tourism a factor in the significant increase in sales and profit in the Arcade Operations business?
- We believe it has been a contributing factor.
- How much impact did foreign exchange gains have in boosting sales and profit in the first quarter?
- On an operating income basis, it added approximately 1-to-2 billion yen. We view foreign exchange as an environmental aspect of management, which has enabled us to deliver earnings while preserving some for other measures.
- The balance of work in progress for game software is at an all-time high, perhaps due to upcoming major titles. Please comment on the soundness of management.
- The balance of work in progress for game software will decrease following the release of major titles, and as such it will not increase indefinitely. While there is a general upward trend due to development costs, the increasing sophistication of hardware, and ongoing enhancement of our workforce, this is within the scope of our plan.
- Is there a tendency for sales of past titles to increase in conjunction with the release of a new major title?
- There is a tendency for sales of catalog titles in a series to increase when a new title is announced or released. For example, titles in the Resident Evil series tend to sell well due to the connected nature of the series’ story and characters. However, we do not factor in a large amount of such sales during the planning stages of game development because there are other factors at work, such as the timing of promotional measures and information releases.
- Monster Hunter: World and the Monster Hunter World: Iceborne continue to sell well; is this due to exposure brought on by Monster Hunter Wilds? Do you expect these levels of sales to continue or is it temporary?
- We see this a result of strategic discounting of titles in the series, including lowering the price of Monster Hunter: World to $9.99 in conjunction with the announcement of Monster Hunter Wilds last December. We will continue to release information regarding titles while closely monitoring sales trends going forward.
- Kunitsu-Gami: Path of the Goddess has been well received; what is the current situation on its sales performance?
- As we only launched the game on July 19 we are unable to give a detailed analysis on its performance, however since it is a completely new IP, we believe it is necessary to increase communications regarding the appeal of the game. We will keep a close eye on user trends.
- Will cash outflows tend to increase in the future due to longer development periods for major titles, strengthening personnel, maintaining release frequency, increasing the ratio of outsourcing, and investing in AI? Also, will AI significantly improve development efficiency?
- We have been communicating for several years that investment and training of human resources is one of management’s priority issues in the medium- to long-term, and the increase in development costs, which is based on sales plans and simulations of human resource investment in line with our five year release pipeline, is within our expectations. In addition, we have been improving the efficiency of development using our own engine for some time, and we will continue to verify the introduction of AI.
- Will it be possible to achieve your goal of 100 million units in annual sales?
- We believe it will be difficult to achieve this goal through catalog title sales measures alone, and we will continue to explore optimal promotional measures for each country and region to increase awareness, while analyzing local price sensitivity.
- Is it correct to assume that the amount of R&D investment cost in the first quarter is one-fourth of the full-year plan? Have there been any issues with the progress of investment?
- The amount of R&D investment during the first quarter was one-fourth of the full-year plan. Guidance for development investment represents the maximum expected figure and will fluctuate depending on the use of outsourcing.
- Development investment is planned to be 53.5 billion yen for the full year, a 24% increase over the previous year, but will it continue to increase?
- The main factors driving increases in development investment are an increase in outsourcing and personnel expenses, however the rate of increase depends on outsourcing utilization. Development investment is managed by ROI, and we have a system in place to manage investment and earnings. Essentially, we aim to improve ROI by maximizing sales rather than curtailing development investment.
- We have heard that Monster Hunter Wilds is cross-play compatible, but will this have an impact on earnings? Also, I would like to know under which account the expense will be recorded.
- This will be recorded under cost of sales. Cross-play for Monster Hunter Wilds is not expected to significantly increase costs despite network construction costs, as it makes use of the knowledge gained from Exoprimal.
- The ratio of PC unit sales to total unit sales is over 50%. Do you expect profits to increase if you lower the prices of PC titles for emerging countries? Also, how far do you expect the PC ratio to increase over the medium to long term?
- It is difficult to definitively say, but play trends in emerging markets and other regions skew toward titles for consoles that are two or three generations older. In order to comfortably play the latest titles released in the past few years, consumers will need a PC with specs as good as the latest consoles, and as such we expect it will take some time before such titles are widely played. Since we aim for annual sales of 100 million units, we are working to expand brand recognition in emerging markets. We expect to increase the ratio of PC unit sales by not only implementing measures related to GDP and pricing, but also by implementing detailed, long-term marketing strategies and promotional measures to appeal to the core segment of PC players.
-
Archives
- FY2024
- FY2023
- FY2022
- FY2021
- FY2020
- FY2019
- FY2018
- FY2017
- FY2016
- FY2015
- FY2014
- FY2013
- FY2012
- FY2011
- FY2010
- FY2009
- FY2008
- FY2007
- FY2006
- FY2005
- FY2004
- FY2003
- FY2002
- FY2001
- FY2000
- FY1999
-
-
January 29, 20253Q FY2024 Financial Results Announcement
-
December 23, 2024-January 28, 2025Quiet Period
-
November 15, 2024Cash Dividend Disbursement (Plan)
-
Integrated Report
-
IR Materials Download
-
IR Social Accounts
-
Top 5 Recommended Pages
(as end of Jan, 2024)