Koei Tecmo Integrated Report 2024

Koei Tecmo aims to establish itself as the world’s leading digital entertainment firm by scaling its development workforce to 5,000 employees and consistently producing AAA titles capable of reaching 5 to 10 million units in sales. The company’s core strategy relies on a multi-layered revenue cycle that balances high-margin licensing collaborations, series expansion, and the creation of new intellectual property. By leveraging a unique brand system consisting of six specialized labels and one AAA studio, the firm seeks to achieve a top 10 global ranking in operating profit while maintaining a disciplined 30% operating profit ratio through rigorous budget oversight and quality assurance.

The company’s operational approach integrates advanced technologies, including the proprietary KATANA ENGINE™ and generative AI, to enhance development efficiency and global competitiveness. Despite achieving record-high net sales of 84.5 billion yen in fiscal year 2023, the firm experienced a decline in operating profit due to increased development costs and missed sales targets. In response, leadership is prioritizing a conservative financial strategy, upfront expensing of development costs, and a renewed focus on cross-team collaboration to ensure future projects meet the high standards required for international market success.

Beyond creative output, the company is formalizing its commitment to long-term sustainability through robust human capital management and corporate governance. By increasing international recruitment, fostering gender diversity in STEM roles, and implementing a succession plan that transitions the firm beyond its founder-led origins, Koei Tecmo is building an organizational structure designed for longevity. Supported by a board with significant independent oversight and a diversified business model that includes entertainment, amusement, and real estate, the company remains focused on delivering consistent shareholder value while navigating the inherent risks of the global gaming industry.