Capcom Results of Operations and Strategies: First Half of Fiscal Year Ending March 31, 2011

Key insights

6 takeaways

01
Capcom reported net sales of 40,706 million yen for the first half of the fiscal year ending March 31, 2011, representing a year-over-year increase of 1,814 million yen.See it on page 5
02
Operating income declined to 3,942 million yen, primarily due to increased development expenses and a 1,097 million yen foreign exchange loss caused by a stronger yen.See it on page 5
03
The Consumer Online Games segment, driven by titles like Dead Rising 2 and Lost Planet 2, saw its operating margin narrow to 14.7% due to rising costs and currency volatility.See it on page 13
04
The Mobile Content division met expectations, supported by the social networking title Monhan Nikki Mobile Airu Mura, which reached over one million registered members.See it on page 14
05
Capcom has revised its full-year financial forecast downward to account for ongoing foreign exchange volatility.See it on page 21
06
Strategic efforts for the second half of the fiscal year include the launch of Monster Hunter Freedom 3 and a structural reorganization to unify consumer, online, and mobile development divisions.See it on page 11

Summary

Capcom’s financial results for the first half of the fiscal year ending March 31, 2011, reflect a period of increased net sales alongside a decline in profitability. While net sales rose to 40,706 million yen—a year-over-year increase of 1,814 million yen—operating income fell to 3,942 million yen. This contraction in earnings was primarily driven by elevated development expenses and the negative impact of a stronger yen, which also resulted in a foreign exchange loss of 1,097 million yen, further depressing ordinary and net income.

The company’s performance was anchored by its Consumer Online Games segment, which saw strong sales of major titles such as Dead Rising 2 and Lost Planet 2. Despite these successes, the segment’s operating margin narrowed to 14.7% due to the aforementioned development costs and currency fluctuations. In other segments, the Mobile Content division performed in line with expectations, bolstered by the success of social networking service titles like Monhan Nikki Mobile Airu Mura, which surpassed one million registered members. Meanwhile, Arcade Operations showed signs of recovery, with monthly sales trending upward by the second quarter, and the Amusement Equipment segment exceeded initial projections through strong repeat sales of arcade and pachinko/pachislo products.

Strategic priorities for the second half of the fiscal year focus on the launch of major titles, including Monster Hunter Freedom 3, and a structural reorganization of development operations to integrate consumer, online, and mobile divisions into a unified multi-platform framework. The company has revised its full-year forecast downward to account for persistent foreign exchange volatility, though it maintains a positive outlook for overall growth. The reporting covers global operations, with specific data points provided for Japan, North America, Europe, and Asia, supported by internal financial records and unit shipment metrics.