Japan Markets ViewCapcom (9697) in Focus, Launching New IP ‘Pragmata’ After Two Postponements

 

[Akira Motoyoshi, QUICK Market Eyes] The Tokyo Game Show 2025 was held at Makuhari Messe from September 25 to 28. The event was packed with hands-on demos of new titles and the latest information, drawing the attention of game fans from Japan and abroad. Among the exhibitors, Capcom arguably garnered the most attention. In addition to the latest installment in the survival horror series, “Resident Evil Requiem,” the public demo of the completely new sci-fi action-adventure game “Pragmata,” which had long been shrouded in mystery, generated significant buzz.

Capcom’s core business revolves around the sale of console games (both physical and digital) and the distribution of mobile content. By strengthening its digital sales, the company not only promotes new releases but also the long-term sale of back-catalog titles, thereby stabilizing earnings and reducing inventory risk. A key strength for Capcom is its extensive portfolio of globally recognized and powerful intellectual properties (IPs). This includes leading franchises such as “Monster Hunter,” which has sold over 100 million units worldwide, as well as “Resident Evil” and “Street Fighter.” The company leverages these created IPs through its “Single Content Multiple Usage” strategy. This involves expanding them beyond games into diverse fields such as visual content, licensed merchandise, and esports. This strategy aims to maximize revenue opportunities and enhance IP recognition.

 

*Source: Capcom, “FY2024 Earnings Supplement (Excerpt) – Mid-to-Long Term Growth Strategies (PDF)”

 

Capcom has established itself as a major player in the global console game market. By strengthening its digital distribution, the company sells its content to over 220 countries and regions worldwide. As a result, its overseas sales ratio has reached approximately 60%. Furthermore, the company’s strengths lie in its proprietary advanced technology and development capabilities, exemplified by the use of its in-house RE ENGINE. Capcom boasts extremely high earnings efficiency, with an operating profit margin of about 40%. This demonstrates its superior development prowess and sales strategy within the gaming industry. The company has set a medium-term management objective of achieving 10% year-on-year growth in operating profit. It has successfully met this target for the past 10 consecutive fiscal years and will continue to work towards achieving it. Capcom plans to strengthen the expansion of its major IPs by investing in visual content, licensed merchandise, and esports. Through these efforts, it aims to maximize earnings opportunities and cultivate new potential users.

“Pragmata,” unveiled at the recent Tokyo Game Show, is a sci-fi action-adventure game set on the moon in the near future. It combines a profound worldview with an original game system. The game was first unveiled at the PlayStation 5 announcement event in 2020 and was originally scheduled for a 2022 release. However, in November 2021, Capcom announced that the release would be postponed to 2023, stating the reason was “to create an unforgettable adventure for everyone.” Furthermore, in June 2023, the company announced an indefinite delay, explaining that “more time is needed to ensure the product reaches a quality that will satisfy our players.” Following that announcement, there were no further updates for some time. However, the company released a new trailer in June 2025, revealing that the game is now set for a 2026 launch. While the details behind the delays remain unknown, it is presumed they were necessary to achieve the level of quality Capcom was aiming for. It appears the company is now fully prepared for its launch. Consequently, the game drew significant interest from visitors to the Tokyo Game Show, with long queues forming for the hands-on demo.

Capcom spokesperson Yoshimura stated, “It is extremely important not only to release sequels to established IPs with stable sales potential, but also to introduce a certain proportion of new IPs, even if they carry risk.” Regarding “Pragmata,” which has been forced to undergo two postponements, the company has indicated that “there are no plans to change the 2026 release schedule.” The game is now expected to become one of the company’s major IPs.

The company’s recent business performance is extremely strong. In its consolidated financial results for the first quarter (Q1) of fiscal year 2025 (April–June 2025), Capcom reported a significant increase in both revenue and profit. Net sales rose by 54% year-on-year to JPY45.5 bn, and operating profit increased by 91% to JPY24.5 bn. This growth was driven by strong performance in its core Digital Contents business, with titles like “Monster Hunter Rise” and “Resident Evil Village” selling well. Additionally, sales of “Street Fighter 6” increased due to strengthened collaboration with esports initiatives. Furthermore, the Amusement Equipments business also contributed to profits. It posted a significant increase in revenue, supported by the steady growth of the smart pachislo machine market. The company has maintained its initial full-year forecast, which projects a 12% increase in net sales to JPY190 bn and an 11% increase in operating profit to JPY73 bn. However, the progress rate for Q1 operating profit reached 34%, significantly exceeding the 20% recorded in the same period of the previous year. This suggests that an upward revision of the forecast is likely. The stock price hit a record high of JPY5,015 in early July, but the subsequent two-and-a-half-month time-based correction has seen it solidify its support around the JPY4,000 level. A rebound is expected as the correction appears to be nearing completion.

 

 

(Reported on September 30)

 

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