Koei Tecmo Announces Strategy for the Next Three Years After Falling Short of Previous Targets

Today, Koei Tecmo announced its financial results for the full fiscal year 2024, on top of its new mid-term management plan and objectives.

According to the documents shared by the company, during the fiscal year, between April 2024 and March 2025, sales were 83,150 million yen, down 1.7% year-on-year. On the other hand, operating profit was 32,119 million yen, up 12.7% year-on-year.

Looking at the Entertainment business, which takes the lion’s share of Koei Tecmo’s businesses and includes video games, sales were 78,078 million yen, 1,408 million yen less than in the previous fiscal year. Operating profit was 31,479 million yen, 3,175 million yen above the previous results.

A breakdown of sales shows 59.2% in Japan and 40.8% overseas, of which 13.1% is in North America, 4.8% is in Europe, and 22.9% is in Asia.

Koei Tecmo admits that it failed to achieve the (admittedly rather lofty) results it planned for the 3rd mid-term management plan, which just ended in March 2025. Yet, some results were achieved.

These include record-high sales in fiscal year 2023 and high profit margins. The company has also moved from 20th to 14th in the operating profit ranking of global digital entertainment companies.

The table below compares what was achieved with the objectives that were set three years ago.

The goals for the 4th medium-term management plan, which will span the next three years under the new leadership of Hisashi Koinuma, are as follows:

The development side of the company needs to aim for growth in the number of pipelines (games in development) and growth in the quality of pipelines. The marketing and business side needs to aim for growth in sales capability, while the whole company needs to grow in cost efficiency.

Specifically, the company wants to re-challenge the objective of 40 billion yen in yearly profit, while achieving over 100 billion yen over three years. The aim is also to achieve an operating profit margin of 30% or more across the board.

Sales should also be over 300 billion yen cumulatively over three years, with over 30 million units sold in the console and PC sector, and sales growing gradually in the online and mobile sector.

Both sectors are seen as growth drivers and providers of stable revenue, with the aim of enhancing the ability to create attractive IP and maximize revenue and value.

Koei Tecmo aims to grow the IP it owns, including joint projects, and to keep revenue from IP licensed out stable. The company also aims to expand its game IP across multiple platforms to further enhance its value.

According to the new Management Plan, the company will maintain its multi-platform strategy, reconsider the degree of risk-taking based on reflections from the 3rd Medium-Term Management Plan, and organize the lineup with a balance between large-scale and mid-class titles.

With three titles already announced for Nintendo Switch 2, more are being prepared for the future.

We also get a forecast for the current fiscal year, which will end in March 2026. Koei Tecmo expects 92,000 million yen in sales (up 10.6% year-on-year) and 31,000 million yen in operating profit (down 3.5% year-on-year).

For the entertainment business, the outlook is 86,100 million yen in sales (+8,022 million yen year-on-year) and 30,600 million yen in operating profit (-879 million yen year-on-year).

Interestingly, Koei Tecmo expects Europe to nearly double its contribution to sales, reaching 8.2% of the total.

In the tables below, we get an even more detailed breakdown of the methods the company intends to use to enhance its capabilities and results.

For consoles and PC games, Koei Tecmo wants to drive growth by increasing the number of titles and improving quality to enhance the hit rate per title.

The company also intends to balance challenges with stable revenue by adequately positioning both large-scale and low-risk titles, as illustrated below.