Toei Animation’s Q3 FY2023: Strong Performances Driven by Latest Film Success

Toei Animation has achieved its highest growth and performance to date, potentially in its history, for the third quarter of FY2023. Sales have grown by 53.01% to 65,064 million yen (≈484.82 million USD), while profit has increased by 64.20% year-over-year to 16,502 million yen (≈122.96 million USD). In comparison, the group only experienced a sales increase of 21.02% and a profit increase of 48.82% from Q3 FY2018 to FY2019, with sales reaching 41,821 million yen (≈311.63 million USD) and profit reaching 9,276 million yen (≈69.12 million USD). The latest performance is also nearly 2.5 times higher in sales compared to Q3 FY2012, with profit nearly 6.2 times more than the same period in that year.

Much of this success can be attributed to the positive response received by the group for its projects, particularly three theatrical releases mentioned in its slides: Dragon Ball Super: Super Hero (June 11, 2022), One Piece Film: Red (August 6, 2022), and The First Slam Dunk (December 3, 2022). Although production costs have increased during this period, the strong performance of these films has had a ripple effect on many related businesses, allowing Toei Animation to absorb some of the increases in cost. However, the group cautions that while the outlook remains favourable, uncertainties in future exchange rate trends and the timing of recording sales from overseas distribution rights could have a slight impact on its overall performance. That said, the forecast for the end of the fiscal year remains unchanged at 76,000 million yen (≈566.31 million USD).

From left to right: Dragon Ball Super: Super Hero, One Piece Film: Red, and The First Slam Dunk have all performed really well for Toei Animation, creating a ripple effect which allowed the company to record its best performance to date

Please note that Toei Animation’s Q3 FY2023 occurred from April 1 to December 31, 2022.

Breakdown According to Segments: Most Impressive Performance for Movies Segment

The breakdown of sales in terms of segments has revealed some interesting results. Firstly, revenue from the Movies segment has skyrocketed by 1,779.05% (based on the available numbers on Toei Animation’s financial sheets) to 5,919 million yen (≈44.11 million USD) from just 315 million yen (≈2.35 million USD). The segment had not surpassed the 2,000 million yen (≈14.90 million USD) mark since Q3 FY2012, with the previous highest achievement being 1,440 million yen (≈10.73 million USD). The outcome of 5,919 million yen (≈44.11 million USD) represents a 4.1 times increase in sales compared to the second-highest figure. Overseas Film has also rebounded strongly, with a 70.32% increase to 17,180 million yen (≈128.03 million USD), maintaining its position as the biggest contributor to sales, accounting for 58.68% of the total. The Others segment reported decent growth of 20.47% to 3,620 million yen (≈26.98 million USD).

The exceptional performance of the Movies segment can be attributed to the remarkable success of films such as One Piece Film: Red and The First Slam Dunk, as mentioned earlier. In the Overseas Film segment, the significant rise in revenue was driven by the sales of distribution rights for movies such as Dragon Ball Super: Super Hero, One Piece Film: Red, and The First Slam Dunk, with strong overseas video streaming rights further boosting the segment’s performance. The Others segment saw increased revenue due to strong video streaming rights sales in the domestic market.

While most segments experienced splendid growth, the TV and DVDs segments faced challenges. Both segments declined, with TV dropping by 11.14% to 2,266 million yen (≈16.89 million USD), and DVDs declining by 6.45% to 290 million yen (≈2.16 million USD). The DVD segment’s performance is the lowest recorded since Q3 FY2012. Note that “DVD” here refers to both sales of DVDs and Blu-rays.

The decline in disc sales can be attributed to the slower performances of Majo Minarai wo Sagashite (Looking for Magical Doremi) and Healin’ Good♡Precure Movie‘s Blu-rays and DVDs compared to the same period the previous year. However, Q3 FY2023 did witness the release of Dragon Ball Super: Super Hero‘s Blu-rays and DVDs on December 7, 2022, which reportedly sold around 33,000 copies according to Oricon (estimated, including those that did not make it into the top rankings). Toei Animation did not specify the actual number of copies sold, but it was not sufficient to significantly boost the segment. Additionally, the outlook for this segment may not improve even by the end of the fiscal year, as both One Piece Film: Red and The First Slam Dunk will have their disc releases beyond the fiscal year. One Piece Film: Red is scheduled to have its Blu-rays and DVDs released on June 14, 2023, while no dates have been announced for Slam Dunk as of yet. As for TV Anime, the reduction in the number of broadcasted shows has had a negative impact on the segment, although the voice production for the gaming side of the business has shown promising results.

Moving on to the Licensing segment, both Domestic and Overseas Licensing have experienced significant jumps, with Domestic Licensing increasing by 36.28% to reach 11,950 million yen (≈89.05 million USD), and Overseas Licensing increasing by 25.01% to reach 19,303 million yen (≈143.85 million USD). This is the highest figure ever recorded for the Overseas segment since Q3 FY2012, and the second-highest for Domestic since Q3 FY2012. The best performance in the Domestic segment was in Q3 FY2019, reaching 12,252 million yen (≈91.30 million USD). The positive increase in sales has also resulted in stronger operating income, with a year-over-year increase of 29.60% to reach 15,711 million yen (≈117.08 million USD), the highest figure seen since Q3 FY2012.

The increase in Domestic Licensing revenue can be primarily attributed to effective sales promotion related to the theatrical releases of One Piece and the Dragon Ball series, which yielded positive results in both merchandise and game rights. In the Overseas Licensing segment, the growth is driven by the sales of game rights for Dragon Ball and One Piece, along with strong performance in merchandising rights for Digimon Adventure, One Piece, and the Dragon Ball series.

Apart from that, Toei Animation has also reported a year-over-year increase of 112.3% to 3,519 million yen (≈26.22 million USD) for its Sales of Goods segment, and a 169.0% increase to 1,186 million yen (≈8.84 million USD) for its Others segment. The significant revenue growth in the Sales of Goods segment can be attributed to product sales related to One Piece‘s shop business (also known as the Mugiwara Store) and The First Slam Dunk film. These sales made a substantial contribution to the overall revenue in the Sales of Goods segment. Additionally, successful events associated with the One Piece and Pretty Cure series resulted in a significant increase in sales for the Others segment.

The One Piece’s Mugiwara Store front page

Breakdown According to Regions: All Areas are Up Year-over-year

When analyzing the regional performances, it is evident that the latest three films have made a significant impact. The Overseas segment, generating 35,717 million yen (≈266.18 million USD), has surpassed the Domestic segment for the third consecutive year, which recorded 29,519 million yen (≈219.99 million USD). This translates to 54.8% of the total revenue for the latest quarter, with the Domestic segment accounting for the remaining 45.2%.

Asia stands out as the largest contributor to the company’s overall revenue, with 15,694 million yen (≈116.96 million USD), marking a notable increase of 14.39% year-over-year. The US follows closely behind with an impressive 11,894 million yen (≈88.64 million USD), experiencing a substantial growth of 30.37% compared to the previous year. Europe is also a strong performer, generating 5,670 million yen (≈42.25 million USD), a remarkable 69.46% increase from the same period last year. Although Latin America lags behind in terms of revenue, it has observed the highest growth rate among the overseas regions, with sales climbing by 217.57% year-over-year to reach 2,458 million yen (≈18.31 million USD).

To summarize, Asia contributes to 43.9% of the total overseas sales, while the US, Europe, and Latin America account for 33.3%, 15.9%, and 6.9% respectively.

Domestic Licensing Top 4

The top four domestic licensing series have remained unchanged since Q3 FY2021. During this period, One Piece has surpassed Dragon Ball to claim the top spot, generating 4,885 million yen (≈36.39 million USD) – a significant increase of 78.61% year-over-year. This marks the first time One Piece has held the top position since Q3 FY2018. Dragon Ball closely follows with 4,467 million yen (≈33.28 million USD), experiencing a growth of 14.83% compared to the previous year. This marks the first time Dragon Ball has relinquished the top spot since Q3 FY2018. It’s worth noting that One Piece consistently held the top position from Q3 FY2012 to Q3 FY2018. Pretty Cure and Sailor Moon have both seen modest increases, with Pretty Cure rising by 2.14% to 381 million yen (≈2.84 million USD) and Sailor Moon climbing by 3.26% to 190 million yen (≈1.42 million USD).

In terms of sales contribution, One Piece is the largest contributor, accounting for 40.9% of the total sales, followed closely by Dragon Ball at 37.4%. Other franchises occupy a significant portion of the total sales but are still dwarfed in comparison to One Piece and Dragon Ball, at 17.0%. Pretty Cure alone accounts for 3.2% of the total share, with Sailor Moon making up half of that at 1.6%.

The situation in the domestic segment shows a slight difference between One Piece and Dragon Ball. In Q2 FY2023, Dragon Ball surpassed One Piece with revenue of 3,126 million yen (≈23.29 million USD), while One Piece trailed behind with 2,880 million yen (≈21.46 million USD). This can be attributed to the fact that Dragon Ball‘s latest film was released earlier than One Piece‘s during that period. However, in Q3 FY2023, One Piece gained significant traction following the release of its newest film, allowing it to generate revenue over a longer period. As a result, One Piece surpassed Dragon Ball with revenue reaching 4,885 million yen (≈36.40 million USD).

Considering that Slam Dunk‘s film was released on December 3, 2022, towards the end of Q3 FY2023, a substantial portion of its revenue has not been accounted for in the current data. Therefore, it is possible that Slam Dunk may enter the Top 4 by the end of the full year once its revenue is fully reflected.

Overseas Film Top 4

The release of Dragon Ball Super: Super Hero has significantly boosted and solidified the position of Toei Animation’s Overseas Film segment in Q3 2023. Although it sits behind One Piece at 4,376 million yen (≈32.60 million USD), it still marks a significant increase of 131.05% compared to the same period in the previous year. It’s important to note that these receipts primarily come from the release of the latest Dragon Ball film outside of Japan, which occurred from August 2022 onwards.

With the international presence of One Piece Film: Red, particularly in November 2022, and Q3 FY2023 covering up to December 31 of the same year, the strong earnings from the film have propelled One Piece to the number one position. One Piece recorded 5,200 million yen (≈38.74 million USD) in sales, marking a 51.34% increase year-over-year. This allows the series to maintain its number one position since Q3 FY2012. Slam Dunk makes its debut on the list (it has not been listed since Q3 FY2012) with 984 million yen (≈7.33 million USD), a surprising addition considering the film only began screening outside of Japan in January 2023. This could be attributed to early receipts earned from the rights to screen the latest Slam Dunk film. Pretty Cure, with a sales increase of 30.70% compared to the same period the previous year, comes in fourth place at 779 million yen (≈5.80 million USD). It’s worth noting that the series saw the release of Delicious Party♡Precure Movie nationwide in Japan on September 23, 2022.

As such, the Others leads the segment by a small margin, accounting for 34.0% of the total share of sales. The second largest share is held by One Piece at 30.3%. Dragon Ball is the third largest with 25.5%, followed by Slam Dunk and Pretty Cure at 5.7% and 4.5% respectively.

Toei Animation attributed part of the reason for the significant growth in this segment to the depreciation of the yen. Additionally, the sales rights of the three major films — Dragon Ball Super: Super Hero, One Piece Film: Red, and The First Slam Dunk — all performed well. Slam Dunk‘s screening rights sales, in particular, saw strong performance after the film’s release in the Asian market. Both Dragon Ball and One Piece were able to maintain or improve their performance from previous fiscal years, thanks in part to the renewal of their distribution contracts in North America.

Looking ahead to the end of the fiscal year, we can expect One Piece to continue dominating this segment, with Dragon Ball also ending on a strong note. However, Slam Dunk poses as a strong competitor and may secure the third position as Toei Animation’s best-performing film in the overseas market, considering its positive reception. Pretty Cure is likely to maintain its position at number four if everything goes well.

Overseas Licensing Top 4

The Dragon Ball series maintains its lead in the overseas licensing segment by a huge margin, with a total of 8,171 million yen (≈60.88 million USD), which is slightly more than twice the amount produced by One Piece at 3,811 million yen (≈28.39 million USD). However, One Piece recorded a larger growth of 29.94% year-over-year compared to Dragon Ball‘s 14.31%. The third biggest title in this segment is the Digimon series, which saw a significant increase of 79.40% to 1,959 million yen (≈14.60 million USD). On the other hand, Slam Dunk, which is in its third consecutive placement, experienced a sharp decline of 51.3% to 685 million yen (≈5.10 million USD), ending the quarter lower than the previous year.

As a result, in this segment, Dragon Ball is ahead of the rest with 42.3% of the share while Others has a combined share of 24.2%. One Piece took up 19.7% while Digimon and Slam Dunk were at 10.1% and 3.5% respectively.

Toei Animation added that both series experienced strong sales for their merchandise, particularly in the European market and were further strengthened with the sales of their existing game application rights, for One Piece in the Chinese market and for Dragon Ball perhaps globally as it was not fully specified in the reports. Dragon Ball had also derived sales from collaborations with other game companies throughout the period. The rise of Digimon here is largely due to strong merchandise sales in the North American region and the sales of its video game rights in the Chinese market.

While Slam Dunk did not perform as well as the previous year, it is expected to make a strong comeback with the release of its latest film outside of Japan at the end of the fiscal year. This is expected to spur demand for the rest of its related products.

One Piece’s Gain Puts It Closer to Dragon Ball

Both the Dragon Ball and One Piece series had their best performances since Q3 FY2012. The combined total of all segments — Domestic and Overseas Licensing, as well as Overseas Film — saw Dragon Ball coming out on top of One Piece with 17,014 million yen (≈126.77 million USD), a 31.57% increase year-over-year. However, One Piece was also up significantly by 52.64% year-over-year, reaching 13,896 million yen (≈103.53 million USD).

Dragon Ball has seen larger growth in the past, with its best ever recorded in Q3 FY2016, where it marked a 170.60% year-over-year increase coinciding with the broadcast of the Dragon Ball Super TV Anime series that began airing on July 5, 2015. For One Piece, this rise is its highest recorded for Q3 since FY2012, with the second highest being 29.41% for Q3 FY2022.

The increase in both series’ earnings can be attributed to the success of their latest films, with One Piece‘s having a more pronounced impact. It is possible that by the end of the fiscal year, One Piece may edge closer to Dragon Ball, but overtaking Dragon Ball, with the gap that exists between the two giants, may prove difficult. All in all, when compared to other titles, Dragon Ball is Toei Animation’s largest contributor to sales at 35.1%, with One Piece slightly behind at 28.7%. The remaining titles accounted for 36.2% of the sales throughout the quarter.

Looking Ahead and What to Expect in Q4

As the fiscal year comes to a close, there are still more releases that are expected to contribute greatly to Toei Animation’s financial performance. First, One Piece Odyssey, the JRPG in which Toei Animation is involved, was released on January 10, 2023. In addition, the release of One Piece‘s card game booster pack is also expected to further consolidate One Piece‘s financial position by the end of the fiscal year. As mentioned above, the release of the new Slam Dunk movie outside of Japan is also expected to generate revenue for the Overseas Film segment.

On the left One Piece Odyssey, a JRPG game and on the right One Piece’s newly released card game based on the latest movie “Film Red”; both are expected to further consolidate One Piece’s earnings

Q4 and beyond are filled with exciting releases for Toei Animation. Tousouchuu: Great Mission started broadcasting on April 2, 2023. Bishoujo Senshi Sailor Moon Cosmos Movie will greet fans and casual viewers alike in June, which should boost Sailor Moon‘s Domestic Licensing segment performance for Q1 FY2024. Knights of the Zodiac‘s live-action movie adaptation was released in Japan on April 28, with Kitarou Tanjou: Gegege no Nazo and Digimon Adventure 02: The Beginning slated for release in Q3 FY2024 (an unspecified date, and on October 27, 2023, respectively). Akuma-kun, the Netflix exclusive, is also scheduled to start airing sometime in 2023.

Furthermore, The Monkey Prince, a joint project was announced to happen between Toei Animation and China’s Bona Film Group, and Infinity Strash: Dragon Quest The Adventure of Dai is expected to have worldwide releases in Fall of 2023.

Key Takeaways:

  • Best Toei Animation’s performance to date since Q3 FY2012, perhaps in history
  • All new films performed really well, hence, a spillover effect
  • Dragon Ball and One Piece continue to lead
  • Both Dragon Ball and One Piece are at their highest sales to date since FY2012, perhaps in history
  • Overseas ahead of Domestic in terms of regional sales
Toei Animation Ownership Chart for Reference

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.

Featured Image:
One Piece Film: Red

Half-year FY2023

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 and some inputs I received from followers.

Slides (Q3 FY2023)
Data Sheets (Q3 FY2023)
Financial Statement (Q3 FY2023)

I will be updating the colour scheme for the Google Charts below for the full fiscal year. Also, extra charts included for additional reference.

Google Charts:
Toei Animation Sales vs Income
Toei Animation Segment Results
Toei Animation Licensing Results
Toei Animation Regional Results
Toei Animation Regional Results (Share)
Toei Animation Regional Results (Specified)
Toei Animation Domestic Licensing (Series)
Toei Animation Domestic Licensing (Share)
Toei Animation Overseas Film (Series)
Toei Animation Overseas Film (Share)
Toei Animation Overseas Licensing (Series)
Toei Animation Overseas Licensing (Share)
Toei Animation’s One Piece (Specified)
Toei Animation’s Dragon Ball (Specified)
Toei Animation’s One Piece vs Dragon Ball

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