Koei Tecmo Cuts Financial Forecast Amid Underwhelming Game Sales

TOKYO — Video game company Koei Tecmo has adjusted its projections for the current fiscal year, with sales figures and operating income taking a significant hit.

The firm has reported an 11% reduction in its sales forecast and a sharp 28% cut in its operational income expectations, amounting to a sales downturn of roughly $70 million. The company’s announcement did not specify the titles that contributed to this downturn.

Sales 95 billion yen → 84 billion yen (11.6% decrease)
Operating profit 37.5 billion yen → 27 billion yen (28.0% decrease)
Ordinary profit 40.5 billion yen → 44 billion yen (8.6% increase)
Final profit 31 billion yen → 32 billion yen Yen (3.2% increase)

Here’s the full PDF announcement with the proper reasoning behind the cut in the financial forecast.

While Koei Tecmo did not reveal details on the underperforming game, I believe games such as “Rise of the Ronin” may have contributed to the decline. Moreover, “Wild Hearts,” which ceased post-launch support abruptly, appears to have underperformed despite its joint launch with gaming giant Electronic Arts (EA).

This fiscal revision blows Koei Tecmo, particularly with its partnership with EA on “Wild Hearts,” signaling a robust backing for the title. A swift pullback on support for the game post-launch suggests it fell well short of sales expectations, impacting the company’s financial health.

This cut in Financial Forecast may impact Koei Tecmo’s future moves, including the potential for new installments or collaborations, such as “Dynasty Warriors 10” or “Xenoblade Warriors(I hope that’s not the case).” Regarding Dynasty Warrior, fans have previously expressed a desire to return to non-open-world formats or improve the existing open-world model criticized for empty and unengaging gameplay.

Though Koei Tecmo has revised most of its financial forecasts downward, it has also noted an upward revision of its non-operating income projections. This suggests external investments may have buoyed the company amidst software sales disappointments.

Looking forward, Koei Tecmo may need to reassess its strategy to reinvigorate its standing in the gaming industry, with potential for new titles and a revisitation of legacy series that could capture fan interest and solidify its financial foundation.

About Koei Tecmo: Koei Tecmo Holdings Co., Ltd. is a Japanese video game publisher, developer, and distributor noted for its best-selling franchises like “Dynasty Warriors,” “Dead or Alive,” and “Nioh.” The company has recently faced significant challenges in the market but is looking toward strategic planning and potential new releases to revitalize its brand.