Konami Nine-Month Revenues, Profits Slide On 'Challenging Market'

Konami posted declining nine-month revenues and profits on Thursday, due to tough comparisons to last year's Metal Gear Solid 4 sales, and a "challenging" home video game market. Revenues for the nine months ended December 31, 2009 were ¥190.93 billion ($2.11 billion), down from ¥264.01 billion ($2.92 billion) a year prior. Profits were ¥10.94 billion ($121 million), down 40 percent from ¥18.42 billion ($203.67 million). Konami attributed the declines to a "challenging" global home video game market compared to last year. The company acknowledged console price cuts, the introduction of new handheld game consoles, and various game publishers releasing high-profile titles during the holidays were meant to "arouse demand" within the overall game market, but Konami saw limited benefit. Nine-month revenues in Konami's digital entertainment division, which houses home console software, were ¥100.4 billion ($1.11 billion), down from ¥148.7 billion ($1.64 billion) for the same period a year ago. Video game software unit sales during the nine months declined to 15.53 million units from 22.35 million. Unit sales within the Metal Gear series dropped to 650,000 units during the nine months, versus 4.5 million units a year prior, when Metal Gear Solid 4: Guns of the Patriots released. Konami's software unit sales leader during the nine months was its Winning Eleven soccer series, which sold 6.96 million units during the period, but even those sales were down from 7.41 million units. Konami's arcade business also was negatively impacted by customer traffic "due to factors such as suppressed consumer spending and the impact of the H1N1 influenza pandemic," Konami said. But gaming and system revenues were still up 11 percent to ¥14.7 billion ($162.9 million). Aside from its arcade and home console software divisions, Konami also houses a health and fitness division, which saw revenues drop 5 percent to ¥64.6 billion ($714.28 million). For its fiscal year ending March 31, Konami still expects net revenues of ¥310 billion ($3.43 billion), and net income ¥16 billion ($176.91 million).