TOKYO -- In a business notoriously reliant on lucking into the next big hit, video game giant Capcom is taking some of the chance out of the equation by leveraging its extensive back catalog, using rereleases on personal computers to reach a wider audience.
The company sees full-year net profit growing 20% to a record 30 billion yen ($264 million), even with only 13 games set to be released by fiscal year-end -- a fifth as many as in fiscal 2018.
First-half earnings released Thursday show net profit jumping 71% on the year to 22.2 billion yen on a 66% rise in net sales to 69.9 billion yen. This strong showing was driven in large part by the success of "Resident Evil Village" in May and "Monster Hunter Rise" in late March, having respectively sold nearly 5 million copies and well over 7 million copies.
The release of "Resident Evil Village" buoyed sales of "Resident Evil 7," an earlier installment in the franchise. © Capcom Investors have voiced concern about earnings falling off again once these installments of two of Capcom's flagship franchises drop out of the spotlight. Yet President Haruhiro Tsujimoto expressed confidence that "we absolutely can grow again next fiscal year."
This optimism rests on the strength of Capcom's catalog of existing games, which accounted for 56% of sales in fiscal 2018 and are set to make up 75% this fiscal year.
"Resident Evil 7: Biohazard," released in January 2017, sold 3.5 million units in its first fiscal year and has continued to sell more than 1 million copies each fiscal year since then.
Capcom's recent focus on PCs has added to the momentum, with rereleases and remasters of a number of older games previously found only on consoles like Sony's PlayStations.
The company had earlier focused on consoles but pivoted a few years ago to cross-platform development for consoles and PCs. Tsujimoto has said Capcom will make PCs its main platform. Capcom aims to have PC titles account for half of its in-house software sales as early as 2022, up from an estimated 30%.
The convenience of being able to buy games online anytime on a PC has encouraged more people to pick up older titles in a franchise when a new installment is announced. "Resident Evil 7," which shares a protagonist with "Village," has enjoyed a fresh boom this fiscal year with the newer game's release, with more than 1 million copies sold in the first fiscal half alone.
"Our market has broadened to people who don't have consoles," Tsujimoto said. This includes many in developing economies, for example, where consoles are often less accessible than PCs.
"When you consider that there are 2 billion gamers in the world, Capcom selling about 30 million games a year means there's still room to grow," he said. Gradually lowering prices on future releases to keep up demand could help ensure years of steady revenue. Capcom is enjoying a virtuous cycle in which money earned from old games funds development of high-quality new games.