Drecom announced its consolidated financial results for the first quarter of the fiscal year ending March 2025. The company reported sales of 2.122 billion yen, a 9.5% decline year-on-year, and an operating loss of 67 million yen, reversing from an 8 million yen profit in the same period last year. The ordinary loss was 88 million yen, compared to a 2 million yen profit previously, and the net loss narrowed to 153 million yen from 441 million yen.
The decline in sales and profitability was partly due to lower-than-expected performance and expenses associated with the release of “The Devil Prince and the Puppet.” Additionally, Drecom invested heavily in new business areas, including publishing, video, and Web3.
In the game business, segment sales reached 2.034 billion yen, down 10.3% year-on-year, but segment profit improved by 7.7% to 254 million yen. The release of the new title “The Devil Prince and the Puppet” impacted expenses, but closing two unprofitable titles helped improve profitability. Despite stable revenue from ten operational mobile game titles, the end of certain contract development projects and underperformance of some titles contributed to the sales decline.
Sales in the contents business rose by 17.6% to 90 million yen, although the segment loss increased to 322 million yen from 227 million yen a year earlier. Drecom has been active in the publishing and video sectors, launching popular series under its “DRE Novels” and “DRE Comics” labels, contributing to higher sales. However, ongoing investments in these new business areas and Web3 initiatives have led to increased losses.
For the fiscal year ending March 2025, Drecom projects robust growth with expected sales of 13.5 billion yen, up 38% from the previous fiscal year. The company forecasts an operating profit of 1 billion yen, a 10.7% increase, and an ordinary profit of 900 million yen, up 13.5%. Net profit is anticipated to surge by 284.4% to 400 million yen, translating to an EPS of 13.98 yen.
Drecom remains optimistic about its long-term growth, supported by strategic investments in advanced technologies and new business ventures. Despite short-term challenges, the company’s focus on innovation and market expansion positions it for significant recovery and growth in the coming fiscal year.
