Last week, Japanese manga, anime and game publishing giant Kadokawa announced its consolidated earnings results for the fiscal year ended March 2026. According to the report, the company suffered a 51.3% decrease in operating profit compared to the previous year, driven by the poor performance of its core publishing and IP creation business (a 51.6% decrease in operating profits year-on-year).
In the recently published mid-term management plan for the period between FY 2026 and FY 2031, Kadokawa cites “excessive reliance on existing winning patterns” as one of the major factors contributing to the decline in profit across the publishing sector.
Specifically, the company has acknowledged a recent bias towards “proven genres,” such as isekai and narou-kei, inevitably leading towards market saturation and worsening profitability. According to Kadokawa, the formulaic approach and a clear lack of depth of content diversity is what’s been preventing its domestic publication business from exploring new genres and taking on innovative projects.
While Kadokawa has been actively implementing measures and hiring more editors in order to expand the number of published titles without bearing a load on its staff, this has also proven to negatively impact its business, leading to an “increase in titles lacking originality or quality.”
To tackle the issue, the company will focus on rebuilding its “genre strategy,” while implementing stricter criteria for greenlighting projects. Furthermore, a strong emphasis has been placed on the restructuring of the publication business, with the Publication Steering Committee, being established in November 2025 as a system for implementing “fundamental structural reforms.”
On a related note, in an effort “build a leaner and more efficient organizational structure,” Kadokawa has also announced an early retirement program for its employees. Starting June 1, the company will solicit voluntary resignations among employees aged 45 or older who have at least five years of service. Employees who agree to retirement will get an additional severance package on top of the regular severance pay, as well as optional re-employment support.
Related:
