FinancialKoei Tecmo
Financial Results for the First Half of the Fiscal Year Ending March 2025
1 Oct 202451 pages~30 min full read
Koei Tecmo reported an 11.4% decline in sales to 35,197 million yen and a 23.1% drop in operating profit for the first half of the fiscal year ending March 2025 due to a sparse release schedule.
Despite the first-half downturn, the company remains on track to meet its full-year target of 90 billion yen in sales, representing a 6.4% annual increase driven by a dense second-half release schedule.
The company’s long-term financial goals include achieving a 40 billion yen operating income and maintaining a 30% operating profit margin to secure a position among the top ten global gaming companies.
Strategic growth is centered on developing new AAA intellectual properties with five-million-unit sales targets, supported by a newly established AAA Studio and the proprietary Katana Engine for AI-integrated production.
To support global expansion and development, the company is aggressively scaling its workforce by hiring over 200 employees this fiscal year while implementing industry-leading salary increases.
International growth remains a primary focus, with the company strengthening publishing infrastructure in North America, Europe, and China while targeting new market entry in Southeast Asia and India.
Koei Tecmo experienced a transitional first half for the fiscal year ending March 2025, characterized by an 11.4% decline in sales to 35,197 million yen and a 23.1% drop in operating profit. This downturn resulted from a sparse release schedule compared to the previous year, though the impact was mitigated by robust back-catalog performance and disciplined cost management regarding advertising and outsourcing. Despite these short-term headwinds, the organization exceeded initial profit forecasts and remains on track to meet full-year targets, anticipating a significant recovery driven by a dense schedule of major releases in the second half of the fiscal year.
The long-term strategic objective is to secure a position among the top ten global gaming companies by maintaining a 30% operating profit margin and achieving an operating income target of 40 billion yen. This growth plan centers on the development of AAA-class titles, with a specific focus on establishing new intellectual properties capable of selling five million units. To facilitate this, a dedicated AAA Studio has been established alongside seven distinct development departments. These teams utilize the proprietary Katana Engine to enhance graphical fidelity and production efficiency through integrated AI and automation, ensuring a steady pipeline of self-published hits across console, PC, and mobile platforms.
Global expansion remains a primary focus, with strengthened publishing infrastructures in North America, Europe, and China, alongside targeted entry into emerging markets in Southeast Asia and India. While domestic Japanese revenue is expected to soften, international growth is projected to drive a 6.4% increase in annual sales to 90 billion yen. To sustain this momentum, the organization is aggressively investing in human capital, planning to hire over 200 employees in the current fiscal year while implementing industry-leading salary increases and expanding corporate infrastructure. This multi-layered revenue strategy balances high-margin IP licensing with large-scale global development to ensure long-term financial stability and shareholder returns.
