Capcom Takes Dragon Punch to the Balance Sheet

| 29 Jul 2010 17:19

Capcom's revenue has plummeted to barely more than one twentieth of what it was this time last year.

Capcom has reported income of ¥216 million for the quarter ending June 30th, representing an astounding 94.8% drop from the same time last year. Capcom is attributing the "drastic decline of profitability" to a number of factors, including poor game sales and a strong yen.

The main reason behind the massively reduced earnings was the poor sales of Lost Planet 2, Capcom said, but Monster Hunter Tri and the DS game Ghost Trick had also sold less than expected. Capcom also said that higher development costs compared to last year, due to an increase in "flagship titles," had played a part.

This doesn't mean that Capcom is in trouble necessarily, as earlier in the year it had reported a more than eightfold increase in year-on-year profits, but such a dramatic drop must be a little worrying. It seems likely that this is exactly the kind of drop in earnings that Capcom hopes to avoid in the future by increasing the number of major titles it releases each year.

Source: MCV

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