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Konami Profits Surge 90% on Metal Gear Solid 4 Sales

Following its pre-results estimates, Konami revealed that, largely thanks to Metal Gear Solid 4 shipping more than 4 million copies, its profit surged 90.3% over last year, wit
After recently predicting an 88% rise in profit on the back of sales of Metal Gear Solid 4, Konami has announced its financial results today -- with profit actually increasing by 90.3% over the same period in the previous year. Konami has released its consolidated financial results for the six month period ending September 30, 2008. Its net revenues have jumped 9.8% to 147 billion yen (U.S.$1.5 billion), while profit has jumped 90.3% to 12 billion yen (U.S.$123 million). While the report does not list any one factor leading to this increase, it does point out that over four million copies of Metal Gear Solid 4 have already been shipped globally, and sales are "still steadily increasing". Overall, the Metal Gear franchise shipped 4.33 million units from June to September 2008, up majorly from 0.51 million in the same 2007 period. Interestingly, with game sales up from 7.84 million to 11.75 million, the franchise provided the vast majority of the company's game biz boost. In fact, Konami's sales of the PS3 platform were up from 1% to 38% of the company's game revenues, since Metal Gear Solid 4 is PS3-exclusive at present. Other franchises which provided profit include the Japan-only arcade and Nintendo DS hit Quiz Magical Academy, and the internationally popular Dance Dance Revolution and Winning Eleven/Pro Evolution Soccer series. Revenue in Konami's Digital Entertainment division -- i.e. games -- grew 25.5 percent from the same period in the previous year, while its Health & Fitness (Konami Sports Clubs) and Gaming & System (slot machines and related businesses, which Konami pursues globally) both grew more modestly, at 3.5 and 3.3 percent, respectively. According to the report, Konami, like most Japanese publishers, says that it "intends to focus on the European and North American video game software markets, where growth is more stable than in the mature domestic Japanese market." The company points to the popularity of its Pro Evolution Soccer series -- 48 million shipped to date -- as a hallmark of this strategy, while Dance Dance Revolution and the critically-panned Rock Revolution are aimed at success in the North American market. Konami continues to find success in the Japanese arcade market, and will continue to support it, as well as expand into online gaming with a Korea-focused RPG title, Chaotic Eden. The company also plans to develop properties which can span multiple media -- a typical move for Japanese companies, who find success in publishing trading card games, comics, and other associated media alongside video games.

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