Japanese mobile game developer Drecom reported widening losses for its fiscal second quarter despite more than doubling revenue, as a Disney-licensed game fell short of expectations. The Tokyo-based company posted a net loss of ¥2.36 billion ($15.5 million) for the six months ended September, compared with a ¥1.02 billion loss a year earlier, according to a statement Tuesday.
Revenue climbed 105% to ¥8.24 billion, driven by the performance of “Wizardry Variants Daphne,” which generated ¥7.94 billion in sales. Yet the gains couldn’t offset mounting operational costs and a ¥1.56 billion impairment charge tied to “Disney STEP,” a location-based treasure hunting game launched in March that failed to attract users.
The misstep highlights risks in Japan’s crowded mobile gaming market, where even Disney’s brand recognition offers no guarantee of success. The game, which turned players’ neighborhoods into virtual treasure hunts featuring Mickey Mouse characters, couldn’t compete against established titles like Pokémon GO.
Drecom’s publishing division, which includes light novels and comics, grew 44% to ¥324 million but remains unprofitable with a segment loss of ¥459 million. The company operates 11 mobile games and is shifting focus toward PC and console development to diversify revenue streams.
For the full year ending March 2026, Drecom forecasts revenue of ¥17.5 billion, up 38%, with operating profit of ¥500 million. However, it expects a net loss of ¥1.3 billion as it continues investing in new content areas.
