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The latest  Metal Gear Solid  too late to save Konami's falling profits

The latest Metal Gear Solid too late to save Konami's falling profits

May 8, 2014 | By Mike Rose




Konami saw its earnings more than halved during the last fiscal year, due in part to a heavy drop in profits from its video game business.

Although the company said that it recorded "solid sales" for titles like Metal Gear Solid V: Ground Zeroes and Professional Baseball Spirits 2014, Konami's Digital Entertainment business video game sales dropped sharply.

The company sold 10.81 million video games during the last fiscal year, compared to 13.61 million sold year-over-year. However, Konami hopes to turn this around this year, stating that "Business opportunities in the game industry are increasing and the gaming business is expected to continue to grow."

This will, in part, involve Konami building more games for smartphones and tablets, as the company's belief is that it can achieve greater earnings through increasing the number of platforms that it brings its games to.

As for traditional video games, Konami plans to unveil new titles at E3, including some new sports games, while also revealing more Metal Gear-orientated information. Boosting PlayStation 4 and Xbox One development is key, said the company.

Notably some of Konami other sectors, including Health & Fitness and its Pachinko business, weren't so hot either, with drops in earnings found there too.

For the fiscal year ended March 31, 2014, Konami's Digital Entertainment business recorded revenues of 104.3 billion yen ($1.0 billion), down from 116.4 billion yen ($1.1 billion) year-over-year, and operating income of 11.7 billion yen ($114.9 million), nearly halved from the previous year's 21.2 billion yen ($208.3 million).

Konami as a whole recorded revenues of 217.6 billion yen ($2.1 billion), down from 226.0 billion yen ($2.2 billion) year-over-year, and profits of 6.2 billion yen ($60.9 million), more than halved from last year's 13.2 billion yen ($129.7 million).

For the current year, Konami is forecasting another drop in profits for Konami's video game business, down to 10 billion yen ($98.2 million) in operating income -- although it believes the company as a whole will see slightly increased profits.


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