Capcom Co., Ltd. Achievements in Q4 2023

Company Overview:

Capcom Co., Ltd., a Japanese video game company, was founded by Kenzo Tsujimoto in 1979. Over the years, it has grown into an international enterprise with subsidiaries in East Asia (Hong Kong), Europe (London, England), and North America (San Francisco, California). Capcom is renowned for its successful franchises such as Resident Evil and Monster Hunter, which have driven the company’s growth.

Achievements and Corporate Strategy:

Key highlights include:

• Record Sales and Profits: Capcom achieved record-high net sales and the sixth consecutive year of record-high profits, marking ten years of continuous operating income growth.
• Major Releases: The release of high-profile titles such as “Resident Evil 4” and “Monster Hunter Rise: Sunbreak” significantly contributed to the company’s success, with both games receiving positive reception and driving substantial sales.
• Expansion of Digital Sales: Capcom focused on increasing digital sales of catalog titles, utilizing strategic pricing and promotions to attract a broad audience and enhance revenue from existing game libraries.

Corporate Strategy and Values:

Capcom’s corporate strategy is centered around sustainable growth through digital transformation. The company’s philosophy of providing happiness through game content reflects its commitment to delivering high-quality entertainment and innovation. This strategy includes:

• IP Leverage: Effectively utilizing its major IPs not only in games but also in movies, merchandise, and eSports, thereby broadening its revenue streams and brand presence.
• Operational Efficiency: Enhancing operational efficiencies, particularly in its Arcade Operations, by promoting new store formats and efficient management practices.
• Global Market Expansion: Continuing to strengthen its global footprint by tapping into emerging markets and expanding the availability of its digital content worldwide.

Economic and Social Initiatives:

Capcom is dedicated to integrating ESG (Environmental, Social, and Governance) principles into its business operations:

• Environmental Initiatives: Implementing measures to reduce environmental impact through sustainable practices and promoting awareness of environmental issues.
• Social Initiatives: Fostering strong relationships with employees, customers, and regional communities by supporting various social causes and enhancing corporate social responsibility efforts.
• Governance: Maintaining high standards of corporate governance to ensure transparency, accountability, and ethical business practices.

Financial Performance:

Digital Contents: The Digital Contents segment remains the primary revenue driver for Capcom. The success of new releases and continued sales of catalog titles resulted in substantial revenue growth. This segment reported record-high sales, driven by strategic digital marketing and expanded distribution channels.

Arcade Operations: The Arcade Operations segment showed resilience as it adapted to post-pandemic conditions. By introducing new store formats and optimizing operations, Capcom managed to stabilize and grow this segment, despite challenges in the arcade industry.

Amusement Equipments: In the Amusement Equipments segment, Capcom leveraged its popular IPs to develop engaging arcade machines and gaming equipment. The sustained popularity of these products and strategic placements in key markets contributed positively to this segment’s performance.

Other Businesses: Capcom’s Other Businesses segment, which includes licensing and merchandising, benefited from expanding collaborations and launching new merchandise. This diversification helped strengthen the company’s overall financial health and provided additional revenue streams.

Total Consolidated Revenue: For Q4 2023, Capcom reported record-high consolidated revenue, marking the seventh consecutive year of profit growth. The company’s net sales for the fiscal year ending March 2023 were 125,930 million yen, with an operating income of 50,812 million yen, an ordinary income of 51,369 million yen, and a net income attributable to owners of the parent of 36,737 million yen. These results were driven by strong performances across all business segments and strategic initiatives aimed at boosting profitability.

• Revenue Increase: Capcom reported a significant revenue increase of 47.96% to 46,231 million yen in Q4FY23 compared to Q3FY23, which stood at 31,245 million yen.
• Investment in Human Capital: The company is actively investing in its workforce, hiring developers, and strengthening its human capital. As of March 31, 2024, Capcom has secured 2,675 developers in its workforce, demonstrating its commitment to growth and innovation.

Final Thoughts

Capcom Co., Ltd. has demonstrated robust financial health and strategic growth in Q4 2023. The company’s achievements underscore its commitment to delivering high-quality entertainment while adhering to principles of sustainability and corporate responsibility. With a focus on digital transformation, leveraging its IPs, and expanding its global presence, Capcom is well-positioned for continued success in the gaming industry.