Bushiroad Financial Results Briefing Material for the Third Quarter of the Fiscal Year 2021

Key insights

6 takeaways

01
Bushiroad achieved record-high quarterly sales of 9.1 billion yen in Q3 2021, marking a 17.1% year-on-year increase.See it on page 1
02
The Digital IP segment, driven by strong Trading Card Game (TCG) performance, reached record-high sales for three consecutive quarters.See it on page 8
03
The company returned to profitability in Q3 with an operating profit of 264 million yen, despite cumulative operating profit for the first nine months remaining below the previous year's levels.See it on page 5
04
The Live IP segment, covering music and sports, faced ongoing financial strain due to government-mandated capacity restrictions on live events.See it on page 10
05
Gross profit margins declined during the 11-month transition period (August 2020–June 2021) due to rising costs in the mobile online games (MOG) department and operational inefficiencies in live events.See it on page 5
06
Profitability was supported by a successful reduction in selling, general, and administrative (SG&A) expenses as promotional spending for new mobile games peaked.See it on page 5

Summary

Bushiroad’s financial results for the third quarter of the 2021 fiscal year demonstrate a period of recovery and record-breaking performance, driven primarily by the strength of its Digital IP business. The company achieved record-high quarterly sales of 9.1 billion yen, representing a 17.1% increase year-on-year. This growth was largely fueled by the Trading Card Game (TCG) department, which saw sustained success through the release of popular intellectual property products. While the company achieved profitability in the third quarter, with an operating profit of 264 million yen, cumulative operating profit for the first nine months remained lower than the previous year due to the broader impacts of the COVID-19 pandemic.

The company operates through two primary segments: Digital IP and Live IP. The Digital IP segment, encompassing TCG, mobile online games (MOG), merchandising, and media, served as the primary revenue driver, achieving record-high sales for three consecutive quarters. Conversely, the Live IP segment, which includes music and sports, faced ongoing challenges as events were held with limited audience capacities due to government-mandated health restrictions. Despite these constraints, the company maintained its "One-Stop Media Mix" strategy, leveraging internal resources to coordinate anime, games, and live performances to maximize IP visibility.

The fiscal period for 2021 was adjusted to an 11-month transition cycle, running from August 1, 2020, to June 30, 2021. Financial performance during this period was characterized by a decline in gross profit margins, attributed to increased costs in the MOG department and the operational inefficiencies of hosting live events under capacity limits. However, the company successfully reduced selling, general, and administrative (SG&A) expenses as promotional spending for new application games peaked, allowing the firm to return to profitability. Looking forward, the company continues to focus on expanding its presence as an IP developer and platform company through upcoming anime projects, live stage events, and new TCG product launches.