SANKYO Co. posted a 39.5% increase in first-quarter net income as the Japanese pachinko machine maker capitalized on popular anime collaborations to outpace a historically troubled industry.
The Tokyo-based company reported net income of ¥17.4 billion ($118 million) for the three months ended June, compared with ¥12.5 billion a year earlier. Revenue climbed 30.7% to ¥55.2 billion ($373 million), driven primarily by its pachinko machine division.
The pachinko industry has faced decades of decline, with sales and gross profits falling at compound annual rates of 8.9% and 8.1% respectively from 2014 through 2020. Yet SANKYO managed to nearly double pachinko machine sales to ¥36.7 billion ($248 million) by leveraging content partnerships and new technology.
The standout performer was an April release tied to the anime “Tokyo Ghoul,” which the company said performed well in both sales and usage at pachinko parlors. SANKYO also launched machines featuring “Lucky Trigger 3.0 Plus” technology and expanded its lineup with titles based on other popular franchises.
However, the strong quarter masks underlying challenges. SANKYO’s full-year revenue forecast of ¥185 billion ($1.25 billion) represents a 3.6% decline from the previous year, with operating profit expected to fall 14.4% to ¥63 billion ($426 million).
The pachislot segment struggled, with revenue declining 9.5% despite releasing an Evangelion-themed machine in July. Meanwhile, the supply equipment business revenue plunged 56% as parlor operators remained cautious about capital investments.
Industry observers note that success increasingly depends on compelling content, with pachinko converging toward video game dynamics where popularity hinges on appealing intellectual properties.
