Kadokawa Dwango Financial Results: 3rd Quarter Ended December 31, 2016

Key insights

6 takeaways

01
Kadokawa Dwango reported cumulative revenue of 150,428 million yen for the nine months ending December 31, 2016, a 3.0% increase year-over-year.See it on page 1
02
Operating income rose 17.5% to 7,388 million yen, reaching 123.1% of the company's full-year forecast.See it on page 3
03
The Publication segment saw a 59.3% surge in operating income and a 7.3% revenue increase, driven by media-mix products including books related to the film 'Your Name'.See it on page 9
04
The Video & Game segment achieved an 8.1% revenue increase and a 69.9% jump in operating income, bolstered by 'Your Name' distribution and 'DARK SOULS III' downloadable content sales.See it on page 11
05
The Web Services segment underperformed, with revenue declining 5.4% and operating income dropping 39.0% due to a decrease in premium Niconico members.See it on page 6
06
As of December 31, 2016, the company held total assets of 240,501 million yen, including 82,223 million yen in cash and cash equivalents.See it on page 14

Summary

Kadokawa Dwango’s financial results for the third quarter ended December 31, 2016, demonstrate a period of solid growth and operational efficiency. The company reported cumulative revenue of 150,428 million yen for the nine-month period, representing a 3.0% increase compared to the same period in the previous fiscal year. Operating income rose significantly by 17.5% to 7,388 million yen, driven by strong performances in the Publication and Video & Game segments, which helped offset a decline in the Web Services division.

The Publication segment emerged as a primary growth driver, with revenue increasing 7.3% and operating income surging 59.3%. This success was attributed to strong sales of media-mix products, including books related to the film "Your Name," as well as a return to profitability for the magazine division. Similarly, the Video & Game segment saw an 8.1% revenue increase and a 69.9% jump in operating income, bolstered by the distribution of "Your Name" and robust sales of downloadable content for "DARK SOULS III."

In contrast, the Web Services segment experienced a 5.4% decline in revenue and a 39.0% drop in operating income. While the number of premium Niconico members decreased, the segment was partially supported by growth in Niconico Channel dues-paying members. The company noted that the Live business followed anticipated seasonal trends. Overall, the group’s performance exceeded its operating income plan, reaching a 123.1% progress rate against its full-year forecast. The consolidated balance sheet reflects a total asset base of 240,501 million yen as of December 31, 2016, with cash and cash equivalents totaling 82,223 million yen.