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Sony posts FY 2010 earnings, singles out profits in PlayStation business
Following Monday's revised forecast – in which Sony warned of a $3.2 billion loss – the recently besieged company has issued its report for the 2010 fiscal year ended March 31. While things at Sony proper might not be entirely rosy, the good news for gamers is that the company's Networked Products and Services division, home of the PlayStation brand, drove operating income "due principally to the contribution of the game business." The roughly $171 million cost of the PSN outage occurred after the end of the fiscal year and therefore isn't reflected in these numbers. So what specifically is responsible for the massive change in operating income, from a ¥83.3 billion loss last year to ¥35.6 billion in income this year? For the singled-out games business, it was thanks to "significant cost reductions of PlayStation 3 hardware and higher unit sales of PS3 software." You can check out the overall sales numbers in that handy slide above. While operating income was up, overall sales in the Networked Products and Services division were largely flat, dipping 1.2% year over year. Looking at the hardware sales numbers, the PS3 sold 14.3 million units versus 13 million last year; the PSP sold 8 million versus 9.9 million last year; and the aging PS2 still managed to hit 6.4 million units versus 7.3 million last year. Forecasts for 2011 have the PS3 ticking up slightly while the PSP and PS2 continue to flag. Not mentioned here though: NGP, which should certainly help the PlayStation family move that needle.
Capcom profits soar with help from record AAA game sales
Good ol' video games came through for Capcom over the twelve months ending March 31, 2011. The company reported "a history-making milestone" of five million-seller titles in the period, with Monster Hunter Freedom 3 (4.6 million units shipped) leading the pack. Additionally, Dead Rising 2 (2.2M units), Marvel vs. Capcom 3 (2M units), Super Street Fighter IV (1.6M units) and Lost Planet 2 (1.5M units) racked up high shipment numbers, and each surpassed the million-mark in pure sales. In all, net sales in Capcom's "Consumer Online Games" division increased 60.8 percent over the previous fiscal year to ¥70.3 billion (about $873 million). But the sales success of so-called "major titles" wasn't the only contributing factor in Capcom's record bottom line for a fiscal year, which showed a net income increase of 257.6 percent over the previous year to ¥7.75 billion -- roughly $96.3 million in profit! Despite reported losses of ¥1.45 billion due to restructuring and another ¥105 million filed under "disaster" -- the Great East Japan Earthquake knocked out ten of Capcom's arcades -- all of the company's business units recorded operating income gains for the year. Notably, the "Mobile Contents" division enjoyed some highlights, with downloads of The Smurfs' Village Facebook game exceeding expectations "by far" and the Japan-only iPhone version of Ghost Trick faring "well." Capcom tempered its jubilation, however, noting that the forecast for the current fiscal year (ending March 31, 2012) calls for "lower sales and earnings." The company anticipates "immeasurable economic losses" in Japan due to the earthquake and its aftermath, as well as a "downturn in consumer confidence" in the game industry at large -- not to mention Capcom's weaker offering of AAA titles this year. Dead Rising 2 ... again? "We will focus more than ever before on our global operations as the environment surrounding the industry rapidly changes," Capcom said, observing that "the rise of social games [is] fueling the growth of new competitors in the industry."
Gamestop sees 'all-time high' sales of $9.47B for fiscal 2010
GameStop is gonna need a bigger moneybin, as the company reported "all-time high" sales of $9.47 billion for the 2010 fiscal year (ending January 29, 2011), with a record net profit of $408 million. During the fourth quarter, the company also saw a 4.8 percent increase in sales to $3.69 billion, with a 10 percent increase in net earnings to $237.8 million. During the GameStop investors call, executives stated they would use information on customer purchases extracted from from the PowerUp Rewards program to help determine the 200 locations that will be shut down over the next year due to overlap. It's not all bad news: that same information will be used to open 200 stores "focusing on underserviced markets." GameStop also plans to "pursue opportunistic growth internationally." The biggest sign that GameStop is doing its best to prepare for the inevitable was the 61 percent increase in "console and PC digital offerings," which brought in $290 million during the year.
Activision reports fiscal 2010 earnings, digital sales up 20%
Publishing giant Activision Blizzard has dropped some hard numbers regarding its business performance for its fiscal 2010 year, which ended December 31. The company reports net revenue for the year reached $4.45 billion, up from $4.28 billion in 2009. (Though revenue recorded in the fourth quarter alone was just $1.43 billion, down from $1.56 billion during the same period the year before.) The standout news is that $1.5 billion of annual revenue came from digital sales, which the company says are up 20 percent over 2009 -- and up 40 percent in Q4 alone. According to the report, digital-based revenue was "driven by increased sales of Activision Publishing's Call of Duty map packs and value-added services for Blizzard Entertainment's World of Warcraft," which CEO Bobby Kotick attributed in part to "significantly enhanced user activity and engagement for our expanding online communities." Selling 1.4 million copies of the first Black Ops map pack on a single platform within 24 hours of its release is certainly what we'd call "user activity."
Sony posts strong Q3 profits (+135%!) in PlayStation group
Despite a small 6% dip in quarterly sales year-over-year, "due to a decrease in sales in the game business resulting primarily from unfavorable foreign exchange rates," Sony's Networked Products & Services group, which houses its PlayStation brand, posted an impressive ¥45.7 billion (rougly $564 million) in profits for the third quarter period, ended December 31, an impressive 135% boost over the prior-year period. "The game business benefited from significant cost reductions of PlayStation 3 ("PS3") hardware and higher unit sales of PS3 software," the earnings report reads. Though quarterly sales of both the PlayStation 3 and PSP lagged year-over-year, Sony is forecasting 15 million PS3 consoles sold for the fiscal year, compared to 13 million for the year prior. Coupled with the aforementioned "cost reductions" and significant bumps in PlayStation 3 software sales, things are looking up in PS3-land. Over in PSP and PS2 land, things aren't so bright. The PSP, recently stricken by hardware obsolescence, is forecasted to sell eight million units for the year, versus nearly ten million last year, while the PS2 is on track to rack up six million in sales, compared to over seven million last year. Toss in some profitability on the PSN front – Sony's working on it – and fiscal 2011 is looking bright for Sony.
Monster Hunter again captures 'center stage' in Capcom 9-month fiscal report
At this time last year, Capcom was thanking Monster Hunter Tri for helping the company boost its 2009 year-end financial results. Today, Capcom heralded the monstrous shipments of Monster Hunter Freedom 3 that closed out 2010 and propelled the publisher's profits up nearly 300 percent in a nine-month period. During the first three quarters of its current fiscal year (which ends March 31, 2011), Capcom netted ¥6.836 billion (nearly $84 million) in profit -- up from just ¥1.731 the same period the year before. Sales of "Consumer Online Games" (what we call "video games," excluding mobile content) were the driving force, totaling ¥54.057 billion ($663.6 million) -- a bit more than 76 percent of total sales for the business, which includes arcade and amusement ("slot machine") operations. Joining Monster Hunter Freedom 3 (currently only available in Japan), Capcom noted three additional "million-sellers" in the nine-month period (April–December 2010): Dead Rising 2 (with more than 2 million units shipped); Super Street Fighter IV (1.6 million units shipped "mainly to Europe and the United States"); and Lost Planet 2 (1.5 million sold -- "though the figure was less than [the] projected shipment"). During the period, Capcom also worked on "rebuilding the development departments comprising our core competence" in an effort to shift greater resources to its mobile operations, with specific focus on social gaming. Sales of "Mobile Contents" for the three quarters amounted to a modest ¥2.383 billion ($29.25 million), led by a bevy of iPhone releases and some "positive surprises," including the popularity of The Smurfs' Village on Facebook. And Capcom hasn't even accounted for all the MaXplosion press in January yet!
Mama Mia! Majesco cooks up $2.1 million fiscal-year loss
Majesco Entertainment ended its last fiscal year (on October 31, 2010) with a $2.1 million loss -- which is better than the $6.6 million it flambéed the previous fiscal year. The financially troubled publisher is pinning its hopes in the new fiscal year (which began Nov. 1) on Crafting Mama, Babysitting Mama and Zumba Fitness, which has already sold a half-million units since its mid-November release. Majesco has also planted one of those money-growing trees: a Facebook game, Friends Cafe. With its focus on mass-market appeal, Majesco could well bake up some profits this fiscal year. We'll keep watch over its shoulder, though, mindful to leave a clear path to the fire extinguisher in case the money continues to burn.
Take-Two records $1.16 billion in revenue over last fiscal year, regains profitability
Take-Two Interactive, publisher of this year's Red Dead Redemption and Civilization V, among others, today announced net revenue earnings of $1.16 billion for the 12 months ending October 31, 2010, a 65-percent growth over the previous fiscal year's revenues. In all, after operating expenses and taxes, Take-Two earned $42.6 million in profit for the year -- quite a turnaround from the $140.5 million hole (read: net loss) it dug itself last fiscal year. Software sales slump, what now? In its fourth quarter alone (August–October), Take-Two brought in $373.7 million in revenue, roughly 32 percent more than in the same period in 2009, working out to $53.8 million in income for the close-out quarter. "We have achieved our goal of profitability in a year without a new release of Grand Theft Auto," boasted soon to be ex-CEO Ben Feder, citing Red Dead Redemption and NBA 2K11, "as well as strong sales of catalog titles and digitally-delivered content," as key to the publisher's success. Take-Two is currently in the midst of a five-month "transition period," having changed its fiscal calendar to now begin April 1 (instead of Nov. 1). Chairman Strauss Zelnick said the company will be focused on "newer areas of the interactive entertainment business, such as digitally-delivered content and the expanding Asian and Latin American markets" through the end of 2010.
GameStop enjoyed sales of $1.9B in Q3; Kinect, Move in 'very short supply'
GameStop's money bin kept on filling up in the third quarter of its fiscal year, with the company reporting $1.9 billion in sales, up 3.5 percent from the same period last year. The company saw a profit of $54.7 million, up 4.8 percent from the $52.2 million from Q3 of last year. The top five selling games for the retailer during the period, ending October 30, 2010, were Halo: Reach, Madden NFL 2011, Fallout: New Vegas, NBA 2K11 and Medal of Honor. Gamasutra reports that during an investor call earlier today, company president Tony Bartel noted there is strong demand for both Sony's Move and Microsoft's Kinect. The company is "excited" to see that the peripherals are currently in "very short supply" and that they are bringing in an "expanded audience." Company execs believe the two items are comparable to the Wii in terms of bringing a different set of customers to stores.
Disney Interactive likely to invest less in console games following $234M loss
Losing $234 million over the course of 12 months is pretty unimaginable to most individuals. For Disney, it's not such a big deal, especially when that loss is recorded by just one of its six company divisions -- the other five all profited over the last fiscal year (ending October 2, 2010), including its Media Networks, which pulled in more than $5 billion in operating income (profit excluding interest payments and income taxes). Unfortunately for gamers, that one bad division was Interactive Media. Uh-oh. "On one side we've got a collection of games businesses," Disney CEO Bob Iger explained of the Interactive Media division to investors during a call this week, "and the other side we have a collection of largely dot-com businesses." For both the fourth quarter and entire fiscal year, Interactive's revenues actually increased marginally over the previous year's earnings, and "operating results" were "improved" (meaning: the division lost less money -- perhaps unimaginably -- in fiscal 2010 than in the previous fiscal year). Still, when you end up $234 million in the hole, something's gotta change. A new Toy Story game (the division's big breadwinner for the year) can't be released every year, after all. Reflecting on a "pretty big shift" in the games industry, in which "everything from mobile apps to social networking games" has become a player, Iger said of Interactive, "It's our goal not only to be profitable, but obviously to get there by shifting our investment and reducing our investment, too." You know what that means: "We probably will end up investing less on the console side than we have because of the shift we're seeing in consumption [...] Consumers are obviously spending time playing games -- from casual games online to mobile apps to social networking to console -- and we felt all along that we need to be where the consumer are [...] we want to be there." No doubt. Quick -- everybody go buy Split/Second before it's too late! Like, for real this time.
Activision Blizzard posts better-than-expected Q3 results: $51m in profits on $745m in revenue
Thanks to "strong performance" from industry staples like Activision Publishing's Call of Duty franchise and Blizzard Entertainment's perennial MMO World of Warcraft and a stellar launch for Blizz's long-anticipated sequel StarCraft 2: Wings of Liberty, Activision Blizzard exceeded its prior third-quarter outlook of $600 million with net revenues of $745 million in the period ending September 30, 2010. Compare that to net revenues of $703 million for the same period last year. It also reported profits of $51 million for the quarter versus $15 million for the same period last year. "For the third quarter, we exceeded our net revenues and earnings per share outlook and delivered strong year-over-year growth," Activision Blizzard CEO Bobby Kotick explained. "Activision Publishing is about to introduce what is likely to be the biggest entertainment launch of the year with Call of Duty: Black Ops, followed by Blizzard Entertainment's World of Warcraft: Cataclysm, which we believe will deliver an incredible breadth of new content to the world's largest massively multiplayer online role playing game community." That's another way of saying, "If you think these Q3 numbers are great, wait until you see next quarter!" And with Q4 capping off Activision Blizzard's fiscal (and calendar) year, Kotick notes that things are looking better than ever for ol' Actiblizzard. "As a result of our over-performance, we are raising our calendar year 2010 net revenue and earnings outlook. We expect to deliver the most profitable year in our history with record operating margins." Specifically the publishing giant is raising its outlook for net revenues from $4.18 billion to $4.28 billion – shareholders should like the sound of that. Gamers will just enjoy Black Ops and Cataclysm. And gamers who are also shareholders can use some of that money to pay for the games you just bought. Investing!
Sony sees modest PS3 growth, dramatic decline in PSP sales in Q2 versus last year
Sony Corporation has released its earnings report for the second quarter of its 2010 fiscal year, and among the highlights is the performance of its Networked Products & Services division, which is composed of PlayStation and its PC offerings. Always a strong component of the company, the division once again showed growth, bringing in ¥369 billion ($4.6 billion) in revenue, up five percent from the ¥352 billion ($4.3 billion) earned in the same period last year. Looking at hardware sales, PS3 shipments rose slightly over Q2 of FY 2009, totaling 3.5 million units versus 3.2 million the year before, a change of 9.3 percent. In its report, Sony cites "strong performance of PS3 significant hardware cost reductions and higher sales," elsewhere briefly mentioning that sales "benefited from the introduction of PlayStation Move in the current quarter." PS3 software sales were up 10 million units for the quarter, or 40 percent, totaling 35 million units versus 25 million for Q2 FY 2009. Yesterday, Microsoft announced that shipments of Xbox 360 for the first quarter of its 2011 fiscal year had grown by 25 percent over the same time last year. While it may seem like 360 is pummeling PS3, it's important to note that Sony's console hasn't seen a hardware refresh since the PS3 slim's introduction last year; the Xbox 360 S launched just prior to Microsoft's Q1 FY 2011. The picture Sony's earnings report paints for the PSP is anything but encouraging. Sales of the handheld dropped to 1.2 million units for the quarter, down from 3 million during the same period in FY 2009, a decrease of 50 percent. PSP software sales were down -- albeit far less dramatically -- 15 percent, with 11 million units sold during the quarter compared to 13 million the previous year. Despite the handheld's lower performance this year versus last, Sony is only projecting a 20 percent overall drop in sales for the year, projecting sales of eight million units versus the 10 million in FY 2009. Still, if signs of a new platform in the PlayStation Phone weren't enough to signal the end of PSP's era, these numbers only make it clearer.
Capcom first-half FY 2010 finds sales up, profits down
Capcom is gettin' by, as the publisher announced that sales were up 4.7 percent, with net profit down 39.9 percent, during the first half of fiscal year 2010, ending March 31, 2011. The publisher also announced that Jun Takeuchi can now add "Corporate Officer" to his already outrageous title of "Deputy Head of Consumer Games R&D Division and General Manager of R&D Production Department." Think that title sounds serious in English? Check it out in Japanese: 執 行 役 員CS開発副統括 兼 制作部長. Net sales reached ¥40.7 billion ($501M) during the six-month period ending September 30, 2010, thanks to the release of Dead Rising 2 and continued sales of Super Street Fighter IV. The publisher also stated that Sengoku BASARA: Samurai Heroes and Monster Hunter spin-off Monhan Nikki Pokapoka Airu Mura shipped over 500 thousands units apiece. These titles helped push that 4.7% increase in sales over the same period last year. Overall, Capcom states sales were stagnant due to the late release of Dead Rising 2 and the "substantial underperformance" of Lost Planet 2. Due to the sales issues, net profit for the first half was ¥1.7 billion ($22 million, down 39.9%). The company forecasts it'll end the fiscal year next March with sales of ¥91 billion ($1.1 billion) and a net income of ¥6.5 billion ($80 million).
Demon's Souls shifts Atlus to black profit tendency
Index Holdings, parent company of Atlus, has released its financial results (PDF) for its fiscal 2010, which ended August 31. Things are looking rosy for Atlus USA, thanks largely to the dark and depressing Demon's Souls, which the company points to as a major factor in raising profits. Index Holdings reported that Atlus USA made ¥3.299 billion ($40.7 million) in sales for the year, up from ¥2.732 billion ($33.6 million) in 2009. More importantly, the company posted an operating income of ¥407 million ($5 million), which compares very favorably to last year's loss of ¥104 million ($1.2 million). Hey Atlus, how about we celebrate by shifting Demon's Souls to white tendency for a little while? Please?
'Get Fit with Mel B' among highlights in shaky SouthPeak financial report
When Get Fit with Mel B is name-dropped no less than three times in your annual fiscal year report as a positive indicator, it tends to raise a red flag. SouthPeak Interactive today shared the financial results of its fiscal 2010 year (July 2009 – June 2010) and did its best to paint an optimistic picture for the current fiscal year. But even fervor over a Spice Girl comeback "this fall" (a firm release date has yet to be locked down) couldn't cover up the bottom line: SouthPeak recorded a net loss of $5.8 million last fiscal year. At least the company has "improved" upon fiscal 2009's $13.3 million loss ... Anybody? Other highlights from fiscal 2010 include an increase in total units sold to 2.6 million from 2.4 million in fiscal 2009; and the release of 29 titles compared to 18 in fiscal 2009. Read that again -- it seems two "highlights" can combine to form a low point: Average unit sales per title fell from 133.33K in fiscal 2009 to 89.66K last fiscal year. "While fiscal 2010 was a challenging year, we made critical improvements to our infrastructure and carefully controlled our costs to better align our operations with our revenue stream," SouthPeak CEO Melanie Mroz said in a conference call today. "Fiscal 2011 will be a continuation of controlled expense and a carefully managed title release schedule. Our focus remains on increasing sales with new titles that address gaming in a way that separates us from our competition."
Red Dead Redemption pushes Take-Two Q3 revenue up to $354.1 million
Take-Two has reported that net revenue for its third fiscal quarter, which ended July 31, 2010, reached $354.1 million -- an increase of $259.2 million over the same period last year. The company attributed the rise primarily to Rockstar's Red Dead Redemption, which has shipped more than 6.9 million units life-to-date. And while several older games, including Grand Theft Auto: Episodes from Liberty City, NBA 2K10 and Borderlands, contributed to overall sales at retail, Take-Two highlighted digitally distributed content as a "meaningful component" of this quarter's outcome. Operating income for the quarter landed at $12.4 million, a big turnaround compared to the $58.3 million loss suffered in the same quarter during 2009, and a minor dip from Q2 2010's $16.9 million. Take-Two's fourth quarter won't benefit from Red Dead's landing impact, but the company already has an extensive lineup of DLC planned for the coming months.
Activision Q2 revenues down, earnings up
Activision has released its financial results for the second quarter of 2010, reporting revenues of $967 million. That's down from $1,038 million reported during the same period last year. Net income is up, however, with the company reporting earnings of $219 million, a 12 percent increase over last year's $195 million. Before you get too confused, know that costs were down dramatically, dropping from $820 million in Q2 2009 to $667 million this year, which led to the increased income. The driver behind Activision's results, according to CEO Bobby Kotick, was "strong consumer response" to the company's workhorse brands, World of Warcraft and Call of Duty. The report also mentions that Activision's digital sales "exceeded retail sales for the first time," having grown more than 20 percent year over year. Somehow, we're not terribly surprised. Looking forward, Kotick pointed to StarCraft 2, Call of Duty: Black Ops and the World of Warcraft expansion Cataclysm as potential bright spots for the rest of the year. Specifically, Kotick noted that Black Ops pre-orders are already outpacing the number of Modern Warfare 2 pre-orders at this time last year.
Gameloft Q2 sales up 15% (thanks, Apple!)
Reporting its second quarter financials for 2010, the unassailable Gameloft appears to remain unassailed. The company reports sales of €33.6 million ($43.6 million) for the second quarter, a gain of nearly 15 percent over the same period last year, which saw sales of €29.3 million ($38 million). Taking the first half of 2010 as a whole, sales have reached the devilish amount of €6.66 million ($8.65 million), an 11 percent increase over the €60.1 million ($78.1 million) earned in the first half of 2009. Gameloft pins the increase in sales on "increased market share in traditional Java and Brew phones as well as by the massive success enjoyed by Smartphones around the world." More specifically, the company's sales in the Apple App Store increased by a staggering 113 percent. With more smartphones (and devices like the iPad) on the way, and with digital distribution becoming more popular, Gameloft expects to sustain its growth through the end of 2010.
XBLM sales surpassed Live subscriptions as Microsoft Xbox Div. income grew in fiscal year
Microsoft has posted financial results for its fiscal fourth quarter and year, which ended June 30. The Entertainment and Devices Division (EDD), of which the Xbox 360 and PC gaming business are a part of, posted revenues of $1.6 billion for the quarter, up from $1.25 billion during the same period last year. Revenue exclusive to the Xbox and PC gaming business was up to $228 million, a 30 percent increase. EDD also posted an operating loss of $172 million, which grew for the $141 million recorded during the same quarter last year. Factors contributing to the loss included increased marketing costs, increased third-party sales on Xbox Live Marketplace and the discontinuation of the KIN phone. Microsoft's full fiscal year 2010 report paints a brighter picture, with the EDD posting an operating income of $679 million, up from $108 million in fiscal 2009, an increase of 528 percent. The increased income was due primarily to reduced operating expenses. Revenue costs also decreased $528 million, thanks largely to lower Xbox 360 production costs. Fiscal 2010 revenues were essentially flat at just over $8 billion. Additionally, Microsoft moved 1.5 million Xbox 360 consoles during the quarter, compared to 1.2 million during the fourth quarter of fiscal 2009. In all, 10.3 million consoles were sold in fiscal 2010, down from 11.2 million the previous year. Meanwhile, Xbox Live now has 25 million members, and our cohorts at Engadget report that Xbox Live Marketplace revenue has exceeded Xbox Live subscription revenue for the first time.
Microsoft reports $4.5b in profit, a record $16.04b in revenue
This time last year, almost to the day, Microsoft saw its first annual sales decline in history. Things are looking much better now, with the company reporting a record $16.04 billion in revenue, a 22 percent year-over-year increase for its Q4 revenue ending June 30th. In fact, revenue is up across all divisions, with Windows and Windows Live seeing the biggest uptick (43.5 percent to $4.55 billion) followed by Entertainment and Devices (27.3 percent to $1.6 billion). Operating income, on the other hand, paints a different picture of E&D, showing a $172 million loss for this quarter (compared to $141 loss in Q4 last year), but looking over the entire fiscal year, the home of Xbox and Zune this year did $679 million in operating income -- a sizable jump to the $108 million from 2009. The overall operating income for the company is $5.93 billion this quarter (net income $4.52 billion), a 49 percent increase over last Q4, and $20.36 billion for the year (18 percent compared with fiscal 2009). We know you're interested in comparisons, so we'll just go ahead and break it down for ya: the gang in Redmond is still beating Apple in both revenue ($16.04 billion vs. $15.7 billion) and profit ($4.52 billion vs. $3.25), but that margin feels smaller than it used to. Enough to keep the rumored pressure off Ballmer? Frankly, we don't even think biplanes could knock the man off the top of a tower, but Windows Phone 7 has a lot to prove, and fast. Microsoft is hosting a webcast of its report later today -- usually much ado about nothing, as far as we're concerned, but we'll listen in and let ya know if anything interesting pops up. Update: Some interesting Xbox 360 statistics. 1.5 million consoles were sold this last quarter. Xbox Live has 25 million members, and for the first time since its inception, the revenue from the Marketplace exceeded subscription revenue.
