Kadokawa Corporation achieved record net sales of 255,429 million yen (≈1.88 billion USD), showing a 15.47% growth year-over-year. However, its net income showed a small retreat of nearly 10% to 12,679 million yen (≈93.21 USD) from the 14,078 million yen (≈103.49 million USD USD) it made the previous fiscal year amid impairment losses, withdrawal from unprofitable businesses, and other unspecified extraordinary losses.
Much of the increase in net sales can be attributed to the hit title Elden Ring, which was met with huge success worldwide. However, the group noted that Q4 FY2023 suffered a decline in sales from the same quarter the previous year due to a reactionary decline of sales for the Elden Ring video game. With sales expected to further slow down for its Video Game segment, FY2024 is expected to record lower sales than in FY2023. However, other segments, with the exception of Web Services and Video Games, are very likely to post higher sales.
Please note that FY2023 occurred from April 1, 2022 to March 31, 2023.
Publishing Business Segment Sees Y-o-Y Sales Increase, but Operating Profit Fell Due to Investments and Increase Expenses
Kadokawa Corporation defines the segment as a business that sells digital and paper-based books and magazines. At the same time, it also produces magazine advertisements and engages in the selling of digital ads and licenses. The group has also continuously published around 5,000 new titles every fiscal year as part of their mixed media strategy.
The overall net sales of the Publishing Business segment have registered a 5.28% year-over-year growth, its third best since FY2016, reaching 139,990 million yen (≈1.03 billion USD). However, the amount of operating profit decreased by 24.27% year-over-year to 13,155 million yen (≈96.68 million USD). Despite this drop in operating profit, it is still the group’s second-best since FY2016, with the strongest being for FY2022, during which it made 17,370 million yen (≈127.64 million USD) in operating profit.
There are several factors that contributed to the decline in profit for the segment. These include investment in human resources, including the reform of personnel systems, investment in assets such as digital printing and logistics facilities (the latter is set to begin operation in April 2024), an increase in expenses, particularly materials used for paper-based books due to inflation, and logistics costs.
Regarding net sales, there are two perspectives to consider. First, for paper-based books, sales have increased by 2.9% year-over-year, but the domestic market decline has prevented even better results. With the pandemic easing in Japan and the situation returning to normal, the group has seen less demand for paper-based books in its home country. Sales have increased due to the number of new titles published and a price revision for these releases, both domestically and internationally. In Q4, the group published a total of 1,418 new titles, of those 639 were Manga titles, which is a 15.10% increase from the 1,232 titles published in Q3 FY2023 and a 5.43% increase from the 1,345 titles published in Q4 FY2022. 50% of the total sales for the segment came from new titles released during the fiscal year. The group has indicated that its overseas market has grown by 10% year-over-year, supported by its businesses outside of Japan, with growth being most noticeable in the North American and Asian regions. Right licensing for the segment has also steadily increased for both the full fiscal year and Q4, further contributing to sales. Among the titles published, Kage no Jitsuryokusha ni Naritakute! (or The Eminence in Shadow in English) Volume 8, The Five Star Stories Volume 17, and Pan Dorobou: Onigiri Boya No Tabidachi (the latter being a children’s book) were said to be very successful.
The breakdown of Kadokawa Corporation’s Paper-based Books and Media for FY2023
Of the total sales made by the group’s paper-based books and media, Manga accounted for 16,100 million yen (≈118.30 million USD), representing a 0.62% decrease year-over-year, and took up 35.8% of the total share. General Books and Pocket Editions were the second largest contributor at 10,000 million yen (≈73.48 million USD), comprising 22.2% of the total share. Light Novels ranked third with a 13.7% share worth 6,150 million yen (≈45.19 million USD), showing a 6.82% decrease compared to the previous fiscal year’s 6,600 million yen (≈48.50 million USD). Regular Paperback occupied 10.2% of the share at 4,600 million yen (≈33.80 million USD), while Children’s Books represented 10.1% of the share with 4,550 million yen (≈33.43 million USD). Magazines had the smallest contribution, making up less than 10% of the share, with 3,630 million yen (≈26.67 million USD).
Kage no Jitsuryokusha ni Naritakute! Volume 8 (left) and Five Star Stories Volume 17 (right) were some of
Kadokawa Corporation’s biggest sellers throughout the fiscal year
Additional note: Kage no Jitsuryokusha ni Naritakute! Volume 8 actually made it onto Oricon’s Top 30 sales chart in Japan between September 26 and October 2, 2022, selling 22,954 copies within its first seven days which is a good outcome. Nevertheless, Oricon does not cover digital sales and its coverage of the Japanese market is not at a 100%. Therefore, total copies sold for both during its debut and lifetime would certainly be much higher. Kage no Jitsuryokusha ni Naritakute! Volume 8 is also not outside of Japan, therefore, its success here is strictly its sales performance in Japan. While we are it, the Anime adaptation of Kage no Jitsuryokusha ni Naritakute! was a huge boost for Kadokawa Corporation. Since the Anime adaptation aired, the work’s total sales for the group have increased ten-fold when compared to the previous fiscal year, with nearly four times the publishing sales it made in FY2021, making the series one of Kadokawa’s most valuable IP for the fiscal year.
But of course, Kage no Jitsuryokusha ni Naritakute! Volume 8 was not the only release in the series’ Manga adaptation to achieve success. Both Volume 9 and Volume 10 also performed well, as evidenced by their placement on Oricon’s Top 30 sales charts. Volume 9 made an appearance on the chart between October 24 and October 30, selling 34,343 copies in just six days. Building upon the success of its predecessor, Volume 10 surpassed it by selling an impressive 31,508 copies in a mere three days.
The same can be said for Five Star Stories Volume 17, which had a big start on Oricon’s Top 30 sales chart in Japan between March 6 and March 12, 2023, at 109,215 copies sold in its first three days. The volume also went on to sell another 43,508 copies the next seven days to bring its total ten-day sales to 152,723 copies.
E-book sales in the Publishing Business segment saw an 11.2% increase year-over-year, representing 38% of total sales. During Q4, sales momentum remained strong, rising by 15%, with sales increasing both in Japan and overseas. The group’s own online stores and other companies’ online stores contributed to overseas sales, although e-book sales in the overseas market are still significantly lower than paper-based book sales (at an 8:2 ratio). Isekai manga, or Manga centered around the concept of otherworldly worlds, were popular among e-book genres. Titles that were adapted into Anime, such as Kage no Jitsuryokusha ni Naritakute!, as well as those aimed at women, were well received. The group also saw increased profits due to its investment in vertical scrolling Manga.
Kadokawa Corporation’s Top 10 Publishing Titles
With the conclusion of the latest fiscal year, the group has unveiled the best-selling publishing titles for FY2023. Leading the list is Sword Art Online, which has maintained its position as the number one title since Q1 FY2023—an impressive feat. Throughout the fiscal year, the series saw several releases, including Sword Art Online: Unital Ring VI Volume 27 and Sword Art Online Alternative: Gun Gale Online Volume 13.
Sword Art Online: Unital Ring VI Volume 27 (left) and Sword Art Online Alternative: Gun Gale Online Volume 13 (right) were among the releases in FY2023 from the Sword Art Online series.
Securing the second spot is Overlord, which retained its position from Q2 and Q3 FY2023, although it was actually the third best-seller in Q1. Over the fiscal year, the series had three popular releases: Overlord Volume 15 and Volume 16 for its Light Novel, and the Manga’s Volume 18, which was recently released on March 25, 2023.
Kage no Jitsuryokusha ni Naritakute! climbed one spot to claim the third position on the list. The series did not feature in the Top 10 for Q1 and Q2 but made its appearance after the Anime began airing. It’s worth noting that Q2 FY2023 ended on September 30, 2022, while the Anime started its broadcast on October 5 of the same year.
As for the others, the KADOKAWA Manga Gakushu Series dropped to fourth place, while Pan Dorobou and Re:Zero kara Hajimeru Isekai Seikatsu maintained their positions at fifth and sixth place, respectively, as they did in Q3 FY2023. Among the releases for Re:Zero kara Hajimeru Isekai Seikatsu throughout the fiscal year were Volume 29 to Volume 32. Bungo Stray Dogs climbed two spots to reach the seventh place, similar to Kage no Jitsuryokusha ni Naritakute!, it did not appear in Q1 and Q2 of the fiscal year. This surge in popularity coincided with the broadcast of its latest Anime season, which aired from January 4 to March 29, 2023. Mahouka Koukou no Rettousei held onto the eighth spot, the same position it occupied in Q3, while Fate moved down a notch to the ninth position. Love Live! settled for the tenth place, similar to its standing in Q3 as well.
Below is the full list of the Top 10:
|1||Sword Art Online||←||2009||〇||〇|
|3||Kage no Jitsuryokusha ni Naritakute!||↑1||2018||〇||〇|
|4||KADOKAWA Manga Gakushu Series||↓1||2015||–||–|
|6||Re:Zero kara Hajimeru Isekai Seikatsu||←||2014||〇||〇|
|7||Bungo Stray Dogs||↑2||2013||〇||〇|
|8||Mahouka Koukou no Rettousei||←||2011||〇||〇|
When considering the sales for the entire segment, the Top 10 titles featured here alone account for 7% of the total sales, amounting to 9,799 million yen (≈72.01 million USD). The remaining titles make up the remaining 93% of sales, totaling 130,191 million yen (≈956.68 million USD). It is important to note that, as mentioned in the Publishing Business segment above, a significant portion of the sales for paper-based books belongs to Manga.
Additional: Suzume no Tojimari has Reached More than 700,000 Copies sold in China
According to the information provided in Kadokawa Corporation’s slide on page 40, the simplified Chinese edition of “Suzume no Tojimari” has sold over 700,000 copies in China since its release in January 2023. In April, it was reported that the Korean edition of the novel had achieved sales of 200,000 copies in South Korea within its first three months. The latest circulation figures for the novel in Japan indicate that it has surpassed 350,000 copies. Oricon’s data, which tracks sales from various stores, shows that the series had reached 270,000 copies for both editions of the Light Novel as of November 20, 2022. Considering its recent monthly momentum, it is estimated that the current circulation figures in Japan may range between 700,000 and 800,000 copies. The light novel was initially released in its home country on August 24, 2022.
Record-breaking Game Business Segment Drives Combined Video and Game Sales to 73,640 Million Yen
Kodokawa Corporation defines its Video Business as a business that plans, produces and distributes live-action films and Anime. It also handles the distribution of licensing rights here and the sales of package software. As for its Game Business, the segment involves planning, development, sales and licensing of game software and internet games.
When considering the combined results of the Video and Game Business segments for the fiscal year, total sales reached an impressive 73,640 million yen (≈541.15 million USD) with an operating profit of 16,387 million yen (≈120.42 million USD). These figures represent a significant year-over-year increase of 40% in sales and 150.53% in operating profit. Breaking it down further, the Video Business segment slightly outperformed the Game Business segment in terms of sales, reaching 43,289 million yen (≈318.11 million USD), a 30.74% increase compared to the 30,351 million yen (≈223.04 million USD) generated by the Game Business, which saw a substantial growth of 55.73% from the previous fiscal year.
However, the real standout is the operating profit of the Game Business segment. In FY2023, it contributed 14,218 million yen (≈104.48 million USD) to Kadokawa Corporation’s operating profit, surpassing the Video Business segment’s 2,169 million yen (≈15.94 million USD). It’s worth noting that both segments experienced a year-over-year increase in operating profit, with the Video Business segment showing a growth of 61.74% and the Game Business segment experiencing an impressive 173.42% rise compared to the previous fiscal year.
The Video Business segment has enjoyed a successful streak in recent fiscal years, and FY2023 marks the first time it has exceeded the 40,000 million yen (≈293.94 million USD) sales mark since FY2020. This achievement can be attributed to strong sales driven by licensing, particularly through the Anime business unit, both in Japan and overseas. The success can also be attributed to the popularity of new titles such as Kage no Jitsuryokusha ni Naritakute! and Overlord IV. Additionally, the increase in the number of new titles aired or released throughout the fiscal year has contributed to overall sales. In FY2023, the group released 59 new titles, an increase of 13 titles compared to the previous fiscal year’s 46. Among these, 49 were TV or web broadcasts, while the remaining titles consisted of eight theatrical films and two OVAs.
Overlord IV (left) and Kage no Jitsuryokusha ni Naritakute! (right) were among the major contributors to Kadokawa Corporation’s Video Business segment sales.
In the live-action business, sales in Q4 saw an increase due to the success of the movie adaptation of Watashi no Shiawasena Kekkon (My Happy Marriage). However, the group had to account for the devaluation of one of its live-action businesses, which resulted in a cost of 1.5 billion yen (≈11.02 million USD) and impacted overall profit.
Note: It appears that there was a discrepancy in the translation of Watashi no Shiawasena Kekkon to “As Long as We Both Shall Live” in Kadokawa Corporation’s slides. After reviewing the Japanese version of the slides and the securities report, it is confirmed that “Watashi no Shiawasena Kekkon” indeed refers to “My Happy Marriage.”
Video Business Performance (Separated)
in million yen
|FY||Sales||Sales Δ% (Y/Y)||Operating Profit||Profit Δ% (Y/Y)|
Turning our attention to the Game Business segment, Kadokawa Corporation’s latest IP, Elden Ring, played a significant role in driving sales. Developed in collaboration between Bandai Namco Entertainment and FromSoftware, Inc., with Kadokawa Corporation being the largest shareholder of the latter, Elden Ring has received critical acclaim, winning Game of the Year at The Game Awards 2022, and achieving impressive global sales of 20 million units as of February 2023.
Elden Ring was a major success and is perhaps the biggest contributor to Kadokawa Corporation’s sales for FY2023.
However, in Q4, the group experienced a decline in sales compared to the previous quarter as the initial momentum from Elden Ring subsided. Notably, a substantial portion of the group’s overseas revenue came from the shipment of Elden Ring. In addition to Elden Ring, net sales also saw an increase due to the contribution of a new title being developed by a wholly-owned subsidiary, Spike Chunsoft, titled “Master Detective Archives: Rain Code,” which is set to be released on June 30, 2023.
The mobile game division also reported an unexpected surge in sales, largely driven by the popularity of Kage no Jitsuryokusha ni Naritakute! Although the Game Business segment may not achieve the same level of success as it did in FY2023, the upcoming release of Armored Core VI: Fires of Rubicon, another title developed by FromSoftware and Bandai Namco Entertainment, is expected to sustain the segment’s momentum in FY2024, albeit on a smaller scale compared to Elden Ring.
Game Business Performance (Separated)
in million yen
|FY||Sales||Sales Δ% (Y/Y)||Operating Profit||Profit Δ% (Y/Y)|
Additional: Watashi no Shiawase na Kekkon’s Success and the Potential for Similar Works
Released on March 17, 2023, the live-action movie adaptation of “Watashi no Shiawasena Kekkon,” the 2019 novel by Akumi Agitogi, starring Ren Meguro and Mio Imada, was well received in Japan. The film has already been watched by 1.76 million people and has achieved a box office revenue of 2.3 billion yen (≈16.90 million USD). The release of the film also sparked a demand for the novels, as evidenced by the physical sales of its volumes recorded on Oricon’s charts from March 13. The impact of the film was so significant that all volumes of the novel appeared on Oricon’s top lists, with a total of 38,117 copies sold between March 13 and March 19. Due to the surge in demand, Kadokawa had to reprint 360,000 copies of the original paperback. Furthermore, the series is expected to receive an Anime adaptation, with the first episode set to be broadcast in July 2023, which is likely to generate further demand for its products.
Kadokawa Corporation’s Top 10 Video Titles
The Top 10 best-selling video titles from Kadokawa Corporation showcase the continued dominance of Overlord, which has held the Number 1 position since Q2 FY2023. Interestingly, in Q1 FY2023 (covering April 1 to June 30, 2022), before the airing of Overlord IV, the series was ranked as the 6th best-selling title. Overlord IV, which was broadcast from July 5 to September 27, 2022, was accompanied by Overlord: Ple Ple Pleiades 4, an ONA (Original Net Animation), airing during the same period as the latest TV Anime sequel.
Re:Zero kara Hajimeru Isekai Seikatsu and Kage no Jitsuryokusha ni Naritakute! maintained their positions at Number 2 and 3, respectively. Notably, Re:Zero kara Hajimeru Isekai Seikatsu did not have an Anime season aired during the fiscal year, while the rise of Kage no Jitsuryokusha ni Naritakute! is not surprising given its Anime adaptation. Prior to the Anime’s debut on October 5, 2022, Kage no Jitsuryokusha ni Naritakute! was not listed in Q1 and Q2 FY2023 but quickly made its mark in Q3. With the announcement of a 3rd season for Re:Zero kara Hajimeru Isekai Seikatsu, it will be interesting to see how the newest season will impact its ranking, potentially challenging for the top spot.
The drop of two spots for Made in Abyss allowed Tate no Yuusha no Nariagari to secure a higher position at Number 4. Both titles gained recognition due to their respective sequel TV Anime adaptations. As for the remaining titles, Kakkou no Iinazuke, Kono Subarashii Sekai ni Shukufuku wo!, Youkoso Jitsuryoku Shijou Shugi no Kyoushitsu e, and Isekai Ojisan each dropped one spot.
|2||Re:Zero kara Hajimeru Isekai Seikatsu||←||2016||〇||〇|
|3||Kage no Jitsuryokusha ni Naritakute!||←||2022||〇||〇|
|4||Tate no Yuusha no Nariagari||↑1||2019||〇||〇|
|5||Bungo Stray Dogs||NEW||2013||〇||〇|
|6||Made in Abyss||↓2||2017||〇||〇|
|7||Kakkou no Iinazuke||↓1||2022||–||–|
|8||Kono Subarashii Sekai ni Shukufuku wo!||↓1||2016||〇||〇|
|9||Youkoso Jitsuryoku Shijou Shugi no Kyoushitsu e||↓1||2017||〇||–|
Overall, the Top 10 titles listed above accounted for sales worth 12,121 million yen (≈89.06 million USD) for Kadokawa Corporation, representing 28% of the total sales. The remaining titles collectively generated 31,168 million yen (≈229.02 million USD), constituting the remaining 72% of sales.
Web Service and Education Businesses Thrive, but Other Businesses Report Operating Loss of 4,535 Million Yen
The Web Service Business segment of the group, which includes social network services, event planning, and mobile content distribution, achieved a 3.4% increase in sales compared to the previous year, reaching 22,063 million yen (≈162.12 million USD). However, the segment’s operating profit declined by 18.5% year-on-year to 1,641 million yen (≈12.06 million USD), partly due to a decrease in subscribers on its Niconico Video platform, which had 1.31 million members by the end of FY2023. The growth in sales can be attributed to the significant contribution of “gifts,” items given to videos and advertising.
In contrast, the Education Business segment, focused on technical schools and online education, experienced a 15.5% increase in sales year-over-year, reaching 12,475 million yen (≈91.67 million USD). The operating profit in this segment soared by 138.2% to 1,768 million yen (≈12.99 million USD). This impressive performance was driven by the introduction of new courses at Vantan Inc., a wholly-owned subsidiary specializing in creative arts education, and an increase in student enrollment at various locations, including Vantan Game Academy, a centre for training video game creators. The business also continued to generate sales from students enrolled in the internet-based correspondence high schools, N High School and S High School.
On the other hand, the Other Businesses segment, which includes IP experience facilities and character goods planning and sales, achieved nearly 50% higher sales compared to the previous year. However, this segment incurred an overall loss of 4,535 million yen (≈33.32 million USD) due to difficulties in attracting customers to Tokorozawa Sakura Town.
What to Look Forward to for FY2024?
Despite the projected decline in net sales and operating profit for FY2024, there are still several exciting titles to anticipate. In the game segment, the upcoming release of “Master Detective Archives: Rain Code” on June 30, 2023, and “Armored Core VI: Fires of Rubicon” on August 25, 2023, are expected to provide a solid foundation for Kadokawa Corporation’s Game Business segment.
From left to right: Kininatteru Hito ga Otoko ja Nakatta Volume 1, Hikaru ga Shinda Natsu Volume 3, and Yamada-kun to Lv999 no Koi wo Suru Volume 7 are expected to make significant contributions to Kadokawa’s Publishing Business sales.
In the publishing segment, Kininatteru Hito ga Otoko ja Nakatta (or The Guy She Was Interested in Wasn’t a Guy at All) Volume 1, which was already released on April 19, 2023, Hikaru ga Shinda Natsu (or The Summer Hikaru Died) Volume 3, set to be released on June 2, 2023, and Yamada-kun to Lv999 no Koi wo Suru (or Loving Yamada at Lv999) Volume 7, are expected to make significant contributions. Yamada-kun to Lv999 no Koi wo Suru Volume 7 and Kininatteru Hito ga Otoko ja Nakatta Volume 1 made impressive debuts on Oricon’s list, selling 61,453 copies in three days and 54,262 copies in five days, respectively. Yamada-kun to Lv999 no Koi wo Suru Volume 7 even ranked fourth on the weekly best-sellers list. These figures represent physical sales tracked by Oricon, which do not include all stores in Japan. Therefore, the actual number of copies sold is likely higher, especially considering the simultaneous release of the Anime adaptation for Yamada-kun to Lv999 no Koi wo Suru Volume 7. As for Hikaru ga Shinda Natsu, Volume 2 performed well with 71,097 copies sold, and Volume 3 is expected to continue that momentum.
From left to right: Kono Subarashii Sekai ni Bakuen wo!, Kuma Kuma Kuma Bear Punch!, and “Oshi no Ko” are anticipated to make significant contributions to Kadokawa’s video sales.
In the video segment, popular titles such as Kono Subarashii Sekai ni Bakuen wo! (or KonoSuba: An Explosion on This Wonderful World!), Kuma Kuma Kuma Bear Punch!, and “Oshi no Ko” are anticipated to contribute significantly to sales, especially in Q1 FY2024 as they are currently airing. The adaptation of Kono Subarashii Sekai ni Bakuen wo! is expected to boost the standing of Kono Subarashii Sekai ni Shukufuku wo! in the top 10 video titles. Even without an Anime in FY2023, the series consistently ranked in the top 10. Based on the reaction to “Oshi no Ko” it is likely to be among the top 10 titles as well, and if all goes well, it may even enter the top 3 for Q1 FY2024.
- Net sales reached their highest level since FY2016, although there was a year-on-year decline in profit.
- The Publishing Business achieved its best sales performance since FY2016, although operating profit decreased year-on-year.
- Manga accounted for the largest share of sales in paper-based books and media, contributing 35.8%.
- Kage no Jitsuryokusha ni Naritakute! and Five Star Stories made significant contributions to publishing sales.
- Kage no Jitsuryokusha ni Naritakute! experienced a ten-fold increase in sales year-on-year after the anime began airing.
- E-book sales showed significant growth and now represent 38% of total publishing sales.
- Video sales were at their strongest since FY2020, with an increase in operating profit year-on-year.
- The Game Business segment had an exceptional year, largely due to the success of Elden Ring, which contributed significantly to the group’s overall sales performance.
- The live-action adaptation of Watashi no Shiawase na Kekkon was highly successful.
Kadokawa Corporation Ownership Chart for Reference
On the day when Kadokawa Corporation announced its full fiscal year results, the company’s stock reached a peak of 2,883 yen (≈21.18 USD) before closing at a slightly lower price of 2,840 yen (≈20.86 USD), representing a decrease of 1.49%. The following day, the stock opened at 2,921 yen (≈21.46 USD), marking a 2.85% increase, and eventually closed at 3,090 yen (≈22.70 USD), reflecting a significant jump of 5.79%.
Toei Animation Co., Ltd. is incorporated in Japan with its head office in Nakano-ku. It is listed on the Tokyo Stock Exchange under ticket symbol: 4816.
All currency conversion was done at the time of writing.
Kage no Jitsuryokusha ni Naritakute!
Please note that this article was written based on the combined information of all the sources listed below, plus further analyses and prognostication of my own by referencing to the data collected from the sources.
Securities Report (ENG)
Securities Report (JPN)
Extra charts included for additional reference.
Kadokawa Sales vs Profit
Kadokawa Publishing Business
Kadokawa Publishing Business (Top 10)
Kadokawa Anime and Game Business
Kadokawa Video Business (Top 10)
Kadokawa Overseas Sales (Stacked)
Kadokawa’s Net Sales by Segment (FY2022)
Kadokawa Net Sales by Segment (FY2023)
Kadokawa Paper-based Books and Media (Share)
Part 1 (Publishing)
Part 2 (Video)
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