COLOPL 4Q FY2024 Operating Results: Q&A Summary

COLOPL’s fiscal year 2024 fourth-quarter performance reflects a strategic transition period characterized by heavy investment in new ventures and the maturation of existing mobile titles. The Entertainment Business segment shifted into a loss during this period, primarily driven by elevated advertising expenditures for the launch of the new smartphone title FESTIBATTLE and the full-scale rollout of the blockchain-based game Brilliantcrypto. While legacy titles like DRAGON QUEST WALK and Shironeko Project met performance expectations, the increased operational costs associated with these new initiatives outweighed the revenue generated by established games.

The company views the initial launch of Brilliantcrypto as a success in establishing value for its digital assets, despite current accounting constraints. Because 1.5 billion yen raised through an Initial Exchange Offering has not yet been recognized as revenue, the project currently shows costs exceeding income. Future financial contributions from this segment are expected to materialize as contract liabilities are converted into sales through sustained user engagement and the implementation of new in-game features like the Lapidary Workshop. Global expansion and token listings remain central to the long-term growth strategy for this blockchain initiative.

Looking ahead, the company is balancing its core mobile game focus with a diversified approach to investment and console development. The Investment and Development Business is entering a harvest phase, with management prioritizing strict investment criteria to mitigate impairment losses while increasing returns. Simultaneously, the company intends to maintain its competitive edge in the mobile sector by leveraging its proprietary location-based technology and strong intellectual property. By focusing on mobile-specific experiences, the company aims to navigate the intensifying multi-platform market and secure future global hits.