Kadokawa Earnings Results for the Fiscal Year Ended March 31, 2025

Kadokawa’s fiscal year ending March 31, 2025, reflects a period of operational resilience and strategic transformation despite significant headwinds. While net sales grew by 7.7%, operating and net profits declined by 9.8% and 35.1%, respectively, primarily due to the financial impact of a major cyberattack and associated extraordinary losses. When adjusting for these disruptions, the underlying business demonstrated robust health, with an estimated 11% increase in sales and a 16% rise in operating profit. This performance was anchored by record-breaking results in the Animation and Film segments and sustained momentum in the Gaming division, driven largely by the continued success of Elden Ring.

The company’s growth strategy centers on a global media mix model, which integrates intellectual property across gaming, streaming, and merchandising to maximize long-term commercial value. To support this, Kadokawa is consolidating its animation production infrastructure under a unified Studio Business Division and scaling its EdTech and digital service offerings. Although the Web Services segment experienced a contraction due to service outages, the company is actively strengthening its governance, security, and compliance frameworks to ensure future stability.

Looking toward fiscal year 2026, the company anticipates consolidated growth as it recovers from the cyberattack and leverages a strong pipeline of animation and creative content. While the Gaming segment is projected to see a year-over-year decline due to the normalization of Elden Ring’s exceptional performance, the broader organization remains committed to its mid-term management plan. By prioritizing capital efficiency, international expansion, and the cultivation of original IP, Kadokawa aims to maintain its 12% return on equity target while navigating a shifting digital landscape.