Kadokawa, the parent company of FromSoftware and several major anime studios, recently announced its consolidated financial results for the first three quarters of the fiscal year ending March 31, 2026.
According to GameBiz, the company reported a year-on-year decline in profits across its publishing (manga, print, e-books) and video game segments, while its anime business slipped into the red and posted a net loss.
In publishing, revenue actually grew overseas, especially in the US and Asia, but overall segment profit fell 90.2% compared to the previous year. Kadokawa attributed the drop primarily to lower revenue per title in Japan, as well as higher personnel expenses that further narrowed profit margins.
The publisher’s game business saw profit down 7% year-on-year, but Kadokawa notes that this is largely the result of exceptional sales of Elden Ring’s base game and Shadow of the Erdtree expansion in the previous fiscal year (implying that this fiscal year is seeing more “normal” performance by comparison). Meanwhile, Elden Ring Nightreign, which released in the current fiscal year, continues to “perform well both domestically and internationally.”
On the other hand, when it comes to anime and films, Kadokawa posted a net loss of 940 million yen, or about $6.13 million USD. The company says this is a result of a big chunk of its lineup being made up of first-time anime adaptations (as opposed to sequels to established, popular series), leading to lower revenue per title.
For the full fiscal year, Kadokawa expects weaker performance across all major profit metrics. Its updated forecast is as follows:
Revenue: 278.2 billion yen (up 0.1% year-on-year)
Operating profit: 10.3 billion yen (down 38.1% year-on-year)
Ordinary profit: 12.4 billion yen (down 30.1% year-on-year)
Net profit: 4.9 billion yen (down 33.7% year-on-year)
