Capcom posting profits, Namco losses; where do their arcade divisions stand?
It’s that time where we start to receive news about different public companies and their profit or loss over a certain period of time. These glimpes generally mention the arcade division of said companies in case they have them and that is the case with both Capcom and Namco, who we will discuss here. So how have their arcade divisions fared over the past nine months?
First off Capcom, who posted gains that were partly attributed to tax credits that the company was able to secure. One the arcade side: “Capcom’s arcade operations saw sales fall 11% but operating income was up more than 295% thanks to a “profitability improvement strategy.” This is talking about Capcom owned arcades and not Capcom-made and sold arcade titles. The jump in income happened despite the (paraphrasing slightly here) “Japanese economy not really seeing any recovery during the nine-month period, and consumer spending seemed to be in a slump…” Probably one of the more interesting things I find about Capcom’s report is how terrible their Wii game sales are, which is leading the company to scale back on developments for that system. This isn’t the first third-party developer I have heard of not making what they expected to off of Nintendo’s cash cow.
Next up is Namco, which doesn’t appear to be doing too well over these past nine months. The company saw a 76% drop in operating income during that time, loosing nearly $130million overall and they are expecting a full year loss of nearly $342 million. They have also announced that they will be laying off 630 employees. Whether this will affect their arcade divisions remains to be seen – according to the company, arcade game machines achieved “steady results” for the company along with their character toy sales. On the flipside however, Namco has two divisions dedicated to arcades – one to develop and sale games and another to operate arcade locations. According to the official report, “both the Visual and Music Content business and the Amusement Facility business posted sluggish results; the former owing to the downsizing of the visual package software market and the latter reflecting the significant effects of a slump in personal consumption.” That slump in consumption I believe is by Japanese consumers (as indicated by the first link above which mentions that specifically) but that might also include international market since I don’t know of consumption going up in most places. Either way it appears that Namco’s consumer (i.e. game console) division is where most of the trouble lays right now, with the only game showing strong results is the arcade port of Tekken 6. Interesting how that works in a world where arcades are “dead” ,eh? With that in mind I really hope that they don’t go back to their ways of porting an arcade title over within a few short months of the arcade release however.
More info here (thanks Juan!):
While we’re speaking of Namco, I did find that there is a new account on Youtube called NamcoAmerica that currently features a promo video of Tank! Tank! Tank! and Go Go Grand Prix. I can’t seem to access their main site at the moment but it looks like they are jumping on the Youtube bandwagon, which is a good thing. here’s Go Go GrandPrix in case you missed that in our EAG coverage.