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Cyberagent's operational profits are down 69.9%

The digital advertising company has sees dip in sales and operational profits but claims strong start to 2023 in its Q1 financials
Cyberagent's operational profits are down 69.9%
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Digital advertising company Cyberagent released its Q1 financials, including key insights into their mobile game holdings.

Although, in terms of revenue for their ABEMA streaming service, Cyberagent saw huge success off the back of the 2022 Qatar FIFA World Cup, they noted that there had been a continued slump in sales and operational profits of their game business. With October-December sales down 29.9% YoY, and operational profits 69.9%, consistent with returns many companies have seen to pre-pandemic levels when it comes to game revenue.

Despite this, Cyberagent’s financials noted optimism with regards to their observations on the performance of games going into 2023. With the upcoming anniversaries of some of their original IP’s such as Granblue Fantasy and Uma Musume Pretty Derby offering hope for a significant boost in sales when they roll around. The company is not holding back on investment into other fields either, including a metaverse project to offered tailored 3D videos for customers.

Sales observations

Although we don’t have all the behind-the-scenes info, it’s fair to say that CyberAgent will be trying to minimise the potentially poor outlook. However, at the same time the company as a whole is not in dire straits, with huge success in their other ventures. So we’re unlikely to see any cancellations or sunsetting in the near future, however if the continued macroeconomic slump affects mobile games going forward we may see a slight step back from this side of their business. Although this would likely be in the much longer term.

Cyberagent still possesses many strong IP’s with multimedia presence, including the aforementioned Granblue Fantasy and Uma Musume titles. As well as partnerships with other franchises, such as Tokyo Revengers, Jujutsu Kaisen and Final Fantasy, the latter of which have upcoming releases pencilled in for 2023. The strong ties between CyberAgent and the parent companies of these franchises should lend a boost to sales when their release rolls around. With Tokyo Revengers and Jujutsu Kaisen still riding high off current publishing runs, movies and anime series.

Although their statement looking forward to improving their games holdings is to “Make successful games and enhance the operational capability to run long term games,” which, even if it is a vague statement, does indicate continued commitment to their gaming division. With similar operational losses reported in their previous financial results, CyberAgent will likely be hoping for a boost in 2023.