Extreme Co. reported a 39% jump in first-quarter operating profit as the Japanese game developer’s content licensing business delivered exceptional growth, though currency losses weighed on bottom-line results.
Operating profit climbed to ¥357 million ($2.4 million) for the April-June period, while revenue increased 18.2% to ¥2.81 billion ($19 million), according to the Tokyo-listed company’s Tuesday filing. However, ordinary profit fell 17.9% to ¥323 million and net income dropped 22% to ¥194 million due to a ¥50 million forex loss compared with a ¥100 million gain a year earlier.
The standout performer was Extreme’s content property division, where revenue surged 166.5% to ¥248 million. The unit benefited from royalty payments tied to the smartphone version of tactical role-playing game “Langrisser” and sales from titles released by subsidiary Dragami Games. Segment profit more than doubled to ¥149 million.
Extreme’s core digital staffing business, which provides technical talent to game studios, showed modest improvement with revenue rising 3.3% to ¥1.67 billion. The division handled 2,402 active projects during the quarter, up from 2,358 a year ago. While smartphone game development demand remained weak, the company noted emerging opportunities in console gaming development.
The contract development unit posted the strongest operational growth, with revenue advancing 32.1% to ¥918 million as corporate digital investment continued expanding. Segment profit increased 29.2% to ¥218 million.
Despite the solid quarterly performance, Extreme maintained its full-year outlook, projecting revenue to decline 3% to ¥11 billion and operating profit to fall 34.1% to ¥1 billion. The conservative guidance suggests management expects headwinds in the company’s traditional smartphone gaming staffing business to persist through the fiscal year.
