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Capcom's fortunes falter due to a dearth of big releases

Japanese game publisher and developer Capcom released its first-quarter earnings results today, and numbers are down across the board due, in part, to a dearth of significant game releases.

Japanese game publisher and developer Capcom released its first-quarter earnings results today, and numbers are down across the board due, in part, to a dearth of significant game releases.

For the three months ended June 30th, Capcom's sales revenue reportedly fell 24.9 percent year-over-year to 10.9 billion yen (approximately $104.2 million USD). From that revenue Capcom reported a loss of 726 million yen (~$6.9 million USD).

Game developers may be especially interested in the performance of Capcom's Digital Contents division during the quarter, since that's where the company tracks its video game business. While Digital Contents' sales revenue rose 7.1 percent year-over-year to hit 6.7 billion yen (~$63.9 million USD), the division recorded an operating loss of 8 million yen (~$76,332 USD) -- down 99.2 percent from the same period last year. 

"As the first quarter corresponded to the off-launch season in the market launch cycle of major titles, sales were mostly generated by minor titles," reads an excerpt Capcom's earnings report. "Also, sales of catalog titles, whose profit margin is high, did not grow substantially. Moreover, the Company has been trying to improve the challenges surrounding online games and mobile phone contents."

Capcom's Amusement Equipments business, which includes its pachinko and pachislots offerings, also recorded an operating loss for the quarter and saw sales decrease 72.5 percent year-over-year.

However, the company's Arcade Operations business saw a jump in both sales (up 11.6 percent) and profits (up 205.9 percent) for the quarter, due in part to what Capcom describes as increased marketing to older people and younger children in the wake of loosened government regulations about nighttime arcade operations in Japan.

Finally, it's Other Businesses segment (think: non-game merchandise like strategy guides and figures) saw an uptick in both sales (up 34.5 percent) and profits (up 152.9 percent) compared to the same period a year prior.

So what does all this mean for the future of Capcom? According to the company, not much -- Capcom is sticking by its earlier forecast to generate 85 billion yen in sales and 13.6 billion yen in profits during its current fiscal year, which ends next March. 

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