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Namco Bandai Q1 earnings wobbly

Publisher plans to cut nearly 70 more Japanese arcades as revenues slide 6.4 percent to $822 million, net income plummets 64 percent.

With the arcade business not what it once was in Japan, many gaming companies based in the region are finding their pockets decidedly light on quarters. Following a massive sell-off of arcade machines earlier this year, Namco Bandai is still suffering the ramifications of the dwindling arcade business.

Reporting on its first-quarter earnings today, the Tokyo-based publisher said that net sales for the three-month period ending March 31 were down 6.4 percent to ¥89,979 billion ($822 million). A greater cause for concern was Namco Bandai's drop in actual income, with net profit slipping 63 percent to ¥1,018 billion ($9 million).

While its Amusement Facility as well as Toys and Hobby divisions slid a respective 10 and 12 percent, home console gaming was actually up for the publisher, if only slightly. Namco Bandai saw its games division climb nearly 4 percent to ¥25,514 ($233 million) on the strength of Dragon Ball Z Budokai Tenkaichi 3 on the Wii and PlayStation 3 (420,000 sold), Taiko Drum Master 2 for the Nintendo DS (260,000 sold), Tales of Symphonia for the Wii (215,000 sold), and Naruto: Uzumaki Chronicles 2 for the PlayStation 2 (208,000 sold).

Speaking at a postearnings conference, Namco Bandai president Takeo Takasu addressed a number of shortcomings in the publisher's first fiscal-quarter performance. As reported by financial news service Forbes, Takasu noted that the high-definition media playback format war was to blame for Namco Bandai's ¥234 million ($2 million) loss, down from a ¥1.1 billion ($10 million) windfall a year ago, saying, "Uncertainties about who would win the next generation DVD format and the subsequent transition to the new format hit the sales of our DVD package." The company's video arm, Bandai Visual, produces and distributes many anime offerings, including the cult hit Cowboy Bebop and the ominpresent Gundam series.

Takasu also addressed the company's flagging arcade business, saying that Namco Bandai would spend ¥4.6 billion ($42 million) to shutter an additional 69 arcades--20 percent of its remaining operations in all. Having blamed the Wii for the arcade scene's current travails earlier this year, Takasu assumed an optimistic face, saying, "I also believe that people can't sit back forever and that they will eventually return (to play games at arcade game facilities)."

20 Comments

  • habit0422

    Posted Aug 7, 2008 8:02 pm GMT

    @Setho10

    You are dead wrong I got both seasons from amazon for under $50 a set, and Rightstuf.com usually has them on sell for that same price. And as for other sets I easily found the Cowboy Bebop set for $29.99, the Haruhi for $45.99, Planets for $29.99 I could go on and give you the sites. The only series I'll give you credit for in Gunbusters which is ridiculous.

  • lamprey263

    Posted Aug 7, 2008 5:40 pm GMT

    an $822 million net income is still pretty good, bigger companies like Sony sometimes only make that much annually

  • Setho10

    Posted Aug 7, 2008 12:32 pm GMT

    @habit0422 Yes and GitS is one of the most expensive anime box sets out there. They are $100 on Amazon. Not that they aren't great, but $100 is a lot of money. Also Bandai makes terrible complete series. Their legendary sets are so pitiful they are barely worth their bargain asking price.

  • tjdeep_2007

    Posted Aug 6, 2008 9:58 pm GMT

    i hate these guys,,,,they dont love pc platform.....

  • habit0422

    Posted Aug 6, 2008 6:56 pm GMT

    @lamprey263 As a big anime fan myself I agree with you as far as the cost of anime dvds, and Badai has recently changed how they release dvds. Now they release two DVDs of a series as one usually around $19.99. I believe that $60 -$70 for a good anime series is very reasonable. FYI some of the other series they publish are Gurren Lagaan, Code Geass, Ghost in the Shell S.O.C, Gunbusters, Eureka Seven and FLAG.

  • arc_salvo

    Posted Aug 6, 2008 5:39 pm GMT

    I hope Tekken 6 comes out for the 360. I don't have a PS3 yet, and I liked Soul Calibur 4 for the 360, although I was disappointed that they'd replaced so many veteran Soul Calibur voice actors.

    I don't blame Takasu for blaming the Wii for the Arcade Scene's problems. The only reason people go to Arcades anymore anywhere are because of the interactive, motion-controlled peripherals they have on many of the games there that you used to not be able to get at home... and now you can get an experience similar to those formerly arcade-only experiences with the new Wii controls.

    So I get what he's saying. Anyhow, the Arcade business will probably still survive even after taking a hit, probably by innovating even further.

  • CorruptGamerGX

    Posted Aug 6, 2008 4:07 pm GMT

    Namco Bandai saw its games division climb nearly 4 percent to ¥25,514 ($233 million) on the strength of Dragon Ball Z Budokai Tenkaichi 3 on the Wii and PlayStation 3 (420,000 sold)

    Nice error GameSpot. DBZ: BT3 was on Wii and PS2.

    Typical Namco, always blaming someone else for their problems.

  • lamprey263

    Posted Aug 6, 2008 3:44 pm GMT

    I don't know what anime series Bandai publishes here, but here in the US anime is marketed all bad. Anime series can cost too much, either buying single discs with 3 or 4 episodes on it each for like $20 to $30 a disc, and around 6 or 7 discs a season. They should follow with the trend, bring an entire season of something to a box set DVD package for $30 to $40 (or no more than $50 at most), then maybe their market can grow more. If Bandai has an American publishing arm they should buy up the licenses for a bunch of popluar shows and publish them affordably for everyone to generate revenues.

  • aBathingApe_

    Posted Aug 6, 2008 2:02 pm GMT

    Soul Calibur will heal a bit of this wound.

  • habit0422

    Posted Aug 6, 2008 1:37 pm GMT

    @ElZilcho That crazy country that you talk of, that you say is only interested in off beat TV show is a big if not the biggest gaming market. Games like Devil May Cry, MGS, Final Fantasy, Dead or ALIVE, Persona, are all straight from Japan and are held in high regard here. You can thank Devil May Cry for giving God of War the formula for how to make great action game on the PS2. I could go on about Japanese developed games I love, but based on your simple minded comment you probably won't care or relate.

  • Master_o_Strate

    Posted Aug 6, 2008 1:14 pm GMT

    Make Games multi platform to maximize profits. That's the smart thing to do.

  • lextexrex

    Posted Aug 6, 2008 1:13 pm GMT

    Whatever, I'm just waiting for Tekken 6.

  • da_chub

    Posted Aug 6, 2008 12:31 pm GMT

    i love how companies complain about how times change and they dont, so they lose money. Wake up and realize the world is changing, like it or not, if you dont evole, you go broke...

  • enix165

    Posted Aug 6, 2008 12:30 pm GMT

    When's Tekken 6 coming out? They had new characters made and there are video ads out, so I assumed it was coming out soon. When it comes out it should boost their sales. And SC4's only been out for a week or so now. So...you know.

  • WhiteTigerX

    Posted Aug 6, 2008 12:24 pm GMT

    Maybe make a Dragon Ball for PC, dunno RPG or something, that would be cool

  • jmartin1016

    Posted Aug 6, 2008 12:17 pm GMT

    I bet Soul Calibur will give it a little push.

  • ElZilcho

    Posted Aug 6, 2008 12:09 pm GMT

    it's a wonder any japanesse game company not named nintendo could be doing all that well at this point, hell, one look at all those whacky tv shows should be proof enough that the japanesse only care about outrightgeous tv shows first, and everything else is second to last in their list of concerns, entertainmentwise. i'm surprised it's just now that a japanesse videogame company is starting to feel the consequences of this crazy culture's taste in media entertainment.

  • SearchBomber

    Posted Aug 6, 2008 11:55 am GMT

    Well, they have a Super Robot Wars game (which usually makes it to the top 10 yearly sales list in Japan) coming in a couple of months, so surely they'll do better next quarter.

  • ctg867

    Posted Aug 6, 2008 11:27 am GMT

    It's just a dry spot. They've had some heavy hitters the last few months, and they have plenty of titles coming in the next few months as well.

  • ps3thabest

    Posted Aug 6, 2008 11:20 am GMT

    just make some more dbz games,and you will be fine.

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