Konami Sees Slight Drop In Sales, Profits, As Social Games Grow

Tokyo-based Metal Gear publisher Konami on Thursday posted a slight drop in sales and profits for the full fiscal year ended March 31, 2011, with the company showing a stronger social gaming business. The publisher noted strong sales of packaged games like PES 2011, Metal Gear Solid: Peace Walker and Castlevania: Lords of Shadow. It also said that its strength in the social games market helped drive sales in its digital entertainment segment, with over 2 million people now subscribed to Dragon Collection, and 1 million for Sengoku Collection. But overall, Konami saw revenues drop slightly during the year, down to ¥258 billion ($3.2 billion) compared to ¥262.1 billion ($3.23 billion) year-over-year. Profits also fell to ¥12.9 billion ($159.2 million), down from ¥13.3 billion ($164.1 million). Konami's digital entertainment segment, which includes home video games, arcade games and social network games, saw revenues drop to ¥133.1 billion ($1.6 billion), down from ¥142.7 billion ($1.8 billion). Packaged games in the segment were virtually flat with ¥65.7 billion ($810.7 million) in sales, but social network games saw a bit of growth, with ¥15.8 billion ($195 million) in sales, up from ¥12.7 billion ($156.7 million). Arcade game sales were down to ¥28.3 billion ($349.2 million) from ¥39 billion ($481.3 million) last year, while trading card games were down to ¥21.4 billion ($264.1 million) from ¥25.8 billion ($318.4 million). In March this year, Konami announced that it was restructuring Bomberman house Hudson Soft, turning it into a business arm that focuses on the burgeoning social games market. Total operating income in the digital entertainment segment was ¥17 billion ($209.8 million), down from ¥21.5 billion ($265.3 million) for the same period a year prior. The company also saw sales of ¥21.9 billion ($270.2 million) from its casino business, up from ¥20.0 billion ($246.8 million) year-over-year. The PlayStation 3 was once again Konami's strongest console, making up 27 percent of video game sales, while Japan is now the company's strongest region, with 7.78 million units shifted compared to Europe's 7.55 million and the U.S.' 6.28 million. Looking forward to the next fiscal year, the company noted that it will put further focus on the social games market, while also expanding its content to the Nintendo 3DS and NGP.