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Konami Sees Slight Drop In Sales, Profits, As Social Games Grow

Konami Sees Slight Drop In Sales, Profits, As Social Games Grow

May 12, 2011 | By Mike Rose

Tokyo-based Metal Gear publisher Konami on Thursday posted a slight drop in sales and profits for the full fiscal year ended March 31, 2011, with the company showing a stronger social gaming business.

The publisher noted strong sales of packaged games like PES 2011, Metal Gear Solid: Peace Walker and Castlevania: Lords of Shadow. It also said that its strength in the social games market helped drive sales in its digital entertainment segment, with over 2 million people now subscribed to Dragon Collection, and 1 million for Sengoku Collection.

But overall, Konami saw revenues drop slightly during the year, down to 258 billion ($3.2 billion) compared to 262.1 billion ($3.23 billion) year-over-year. Profits also fell to 12.9 billion ($159.2 million), down from 13.3 billion ($164.1 million).

Konami's digital entertainment segment, which includes home video games, arcade games and social network games, saw revenues drop to 133.1 billion ($1.6 billion), down from 142.7 billion ($1.8 billion).

Packaged games in the segment were virtually flat with 65.7 billion ($810.7 million) in sales, but social network games saw a bit of growth, with 15.8 billion ($195 million) in sales, up from 12.7 billion ($156.7 million).

Arcade game sales were down to 28.3 billion ($349.2 million) from 39 billion ($481.3 million) last year, while trading card games were down to 21.4 billion ($264.1 million) from 25.8 billion ($318.4 million).

In March this year, Konami announced that it was restructuring Bomberman house Hudson Soft, turning it into a business arm that focuses on the burgeoning social games market.

Total operating income in the digital entertainment segment was 17 billion ($209.8 million), down from 21.5 billion ($265.3 million) for the same period a year prior.

The company also saw sales of 21.9 billion ($270.2 million) from its casino business, up from 20.0 billion ($246.8 million) year-over-year.

The PlayStation 3 was once again Konami's strongest console, making up 27 percent of video game sales, while Japan is now the company's strongest region, with 7.78 million units shifted compared to Europe's 7.55 million and the U.S.' 6.28 million.

Looking forward to the next fiscal year, the company noted that it will put further focus on the social games market, while also expanding its content to the Nintendo 3DS and NGP.

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