Capcom Not So Blue This Quarter

The Smurfs' Village
Today, Capcom released their financial results for the first half of 2011. According to Gamasutra, Capcom saw an overall revenue of ¥29.3 billion ($385.9 million USD) for the fiscal six-month period, down 28.1% compared to last year. The over all profits were ¥906 million ($11.9 million), which is down by 49.2% compared to last year. The company was quick to point the finger at Dead Rising 2 and Super Street Fighter IV sales being down from last year, but also that they still beat their internal sales and profits forecasts.
Capcom has also been pushing into the social network and mobile markets. The push into the mobile market saw a growth of 89%, taking revenues up to ¥2.6 billion ($34.2 million), but the operating income of the division went up an astounding 201%, or ¥903 million ($11.9 million), compared to the previous fiscal year. The most notable performing game for Capcom has been The Smurfs’ Village in the social network game market, which is also available for mobile devices.

The mobile division also saw increases with other titles like Monster Hunter: Dynamic Hunting and Resident Evil: Outbreak Survive respectively. Capcom also pointed out that other games on various other platforms like Resident Evil: The Mercenaries 3D, Monster Hunter Freedom 3 HD Ver., Super Street Fighter IV: Arcade Edition and Sengoku BASARA: Chronicle Heroes had all performed solidly.

The Arcade Operations division had a small growth with revenues of ¥6.1 billion ($80.3 million), up 2.3% compared to last year. However, the operating income was up 67.1% or ¥1.2 billion ($15.8 million) compared to last year.

Analysis: I’m not sure Capcom should be putting their bets on the Smurfs for the long term. I’m cautious because we saw Zynga’s profits drop dramatically last month. I worry Capcom will see the same thing happen in this market, especially after the newness factor wares off.

The company has had many solid titles, but their profits have been going down from one year to the next and that pattern will not draw in future investors, generally. I see Capcom holding on the ledge of a cliff, and they’ll either pull themselves up, fall to their doom, or be helped out by some other company and no longer be independent.

They have Ultimate Marvel vs Capcom 3 on the horizon and I hope that, along with Dead Rising 2: Off, will be enough to give them a stronger profit for the second part of the year. From what we’ve been seeing, however, I’m not holding my breathe, but I’m nothing if not positive.


About Brandon Mietzner