FinancialKoei Tecmo
Financial Results for the Q3: Fiscal Year Ending March 2025
21 pages~24 min full read
Key insights
7 takeaways · ~3 min read- 01Koei Tecmo’s Q3 sales fell 14% year-over-year to ¥61.1 billion, primarily due to a lighter release schedule for console and PC titles compared to the previous fiscal year.See it on page 11
- 02Operating profit declined 25.8% to ¥20.3 billion, though net profit increased 3.6% to ¥25.2 billion due to stable ordinary and net profit performance.See it on page 6
- 03The company maintains its full-year forecast of ¥90 billion in sales and ¥30 billion in operating profit, heavily dependent on the performance of upcoming titles like 'Dynasty Warriors: ORIGINS'.See it on page 7
- 04The Entertainment segment, the company's primary revenue driver, saw a 14.9% revenue drop as the business relied more on existing mobile IPs rather than new console and PC releases.See it on page 10
- 05Personnel costs rose 10% year-over-year due to base-pay increases and hiring, which were partially offset by reduced spending on outsourcing and advertising.See it on page 5
- 06Koei Tecmo is targeting a 35% free-float ratio by March 2026 to comply with Tokyo Stock Exchange Prime Market listing standards.See it on page 20
- 07The company continues its 50% payout policy, splitting net profit equally between shareholder returns (dividends and buybacks) and growth investments.See it on page 19
Summary
The presentation reports KOEI TECMO HOLDINGS’ consolidated financial performance for the third quarter of fiscal 2025, ending March 2025. Sales fell by 14 % YoY to ¥61.1 billion, driven by a shift from new console/PC releases in FY23 to fewer titles and reliance on existing mobile IPs in FY24. Operating profit declined 25.8 % to ¥20.3 billion, while ordinary and net profits remained near flat, with net profit up 3.6 % to ¥25.2 billion. The Entertainment segment contributed the bulk of sales, yet its revenue dropped 14.9 % due to weaker console/PC and mobile performance; the Amusement, Real Estate, and Other segments showed modest gains or losses. Personnel costs rose 10 % YoY, offset by reductions in outsourcing and advertising expenses.
Expense trends indicate a continued emphasis on hiring and base‑pay increases, with outsourcing costs decreasing after one‑time collaboration outlays. The company maintains a 50 % payout ratio, allocating half of net profit to dividends and buybacks and the remainder to growth investments. Forecasts for FY24 remain unchanged, targeting ¥90 billion in sales and operating profit of ¥30 billion, contingent on the success of upcoming console titles such as “Dynasty Warriors: ORIGINS.” The Q4 outlook anticipates more than five new releases, with a major title expected to drive sales. The company also outlines measures to meet Tokyo Stock Exchange Prime Market listing standards by March 2026, including actions to achieve a 35 % free‑float ratio.
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