Konami Profits, Revenues Drop On Tough Comparison Against MGS4

Tokyo, Japan-based Konami reported a fiscal Q1 revenue decline of 20.9 percent and a profit decline of 93.5 percent compared to the same quarter a year ago, when the publisher released the hit Metal Gear Solid 4: Guns of the Patriots. Konami said a tough comparison against April 2008's PlayStation 3-exclusive MGS4 was a primary reason for the declines, as well as a tough economic environment. Net revenues for fiscal 2010 Q1 (April-June) dropped to ¥55.98 billion ($584.89 million) from ¥70.8 billion ($739.47 million) a year prior, while net income fell to ¥367 million ($3.84 million) from ¥5.66 billion ($59.16 million) year-on-year. Specifically, Konami's digital entertainment segment, which includes sales of home video games, dropped 45.1 percent to ¥24.6 billion ($257.04 million) year-on-year. MGS4 has sold over 4.5 million units to date. For Konami's fiscal Q1 a year ago, the game sold 3.94 million units, while this most recent quarter saw MGS4 sales of 160,000. Overall unit sales for the most recent quarter were 2.96 million versus 6.94 million a year ago. Nintendo Wii software led unit sales share for the quarter with 28 percent of sales, followed by PSP (20 percent), PS2 (15 percent), PS3 (13 percent), Xbox 360 (4 percent), and PC (1 percent). Konami reported "solid sales" of sports titles including baseball (Jikkyou Pawafuru Pro Major League 2009) and soccer games (Winning Eleven), which sold 240,000 and 860,000 units during the quarter, respectively. Aside from video games in the arcade and at home, Konami's businesses also include health and fitness, and gaming and system (casino). Some of the announced upcoming titles from Konami include Metal Gear Solid Peace Walker for PSP, Metal Gear Solid Rising for PS3, Xbox 360, and PC, Castlevania: Lords of Shadow for PS3 and Xbox 360, and Silent Hill: Shattered Memories for Wii, PS2, and PSP. For the full fiscal year 2010 ending in March, Konami expects revenues of ¥310 billion ($3.24 billion), which would be flat year-on-year. The publisher expects operating income for the year of ¥30 billion yen ($313.38 million), up from ¥27.4 billion ($286.19 million).