Capcom Profits Fall 95 Percent As New Releases Loom

Capcom's heaviest hitters -- Resident Evil 5, Street Fighter IV and Bionic Commando are just about to release. But that means there's little to profit from in the publisher's third quarter, and so its just-released financial results were weak. In the three months ending December 31st, Capcom's profits dropped 95 percent to ¥179 million ($1.99m), while net sales were down 8.6 percent to ¥47.22 billion ($526.5m). Aside from the lack of new releases, Capcom says the global economy and the shrinking Japanese market also played a role in its current weakness. The yen is still quite strong against global currencies, an issue that impacted Nintendo as well, and Capcom has the added burden of a continually challenged arcade business. The company’s most successful title of the year continues to be Monster Hunter Portable Unite for the PSP. Mega Man: Star Force 3 on Nintendo DS and Rockstar’s Grand Theft Auto IV -- which it publishes in Japan -- also did well, Capcom says. Overall sales for Capcom’s home video game division were down 13.4 percent to ¥26.71 billion ($297.8m), with operating income down 27.1 percent to ¥4.40 billion ($49.1m). Following concerted attempts to attract a wider family audience to its various arcade operations, net sales were up 4.8 percent to ¥10.04 billion ($112.0m), but operating income was down 80.2 percent to ¥113 million ($1.26m). The company saw greater success in arcade game sales, however. Net sales weree up 123.1 percent to ¥4.84 billion ($54.0m) and operating income turned last year's loss last year into a ¥381 million ($4.25m) profit. 2D beat ‘em-ups Tatsunoko VS. Capcom and Street Fighter IV were credited with the turnaround, although Capcom still described the market as suffering from "weakening demand".