CyberAgent, the developers behind hit game Uma Musume Pretty Derby and others, has seen an 86.2% drop in operating profits and a 27.7% drop in game sales year-on-year during a lean financial report for the quarter.
It follows on from an equally lean Q1 earlier this year, and sees a significant drop in sales. In Q2, CyberAgent had seen a massive 51.9% increase in QoQ game sales, credited by them to major anniversary events in their titles. However, these latest financials indicate a course correction when compared to the previous year.
It’s worth noting that last year CyberAgent had a much higher quarter in terms of operating profit, likely because of major events like the release of Uma Musume Pretty Derby in the Korean market. However, in lieu of any major new releases and instead game anniversaries, it’s been a leaner year overall for them - despite a major boost in the previous quarter.
A static Japanese market
CyberAgent themselves note that one of their major titles, arguably their flagship, Uma Musume Pretty Derby has entered what they call a “stability phase” after the momentum it had sustained for the past two years. It’s indicative of a more static Japanese market, where the top three highest earning games have barely shifted in the past few years. While this sort of stability is good for the front-runners, it can also seemingly be a negative as it results in a slower death that many companies seem poorly equipped to respond to.
However, outside of games and in their ad business, CyberAgent seems to be doing fairly well, with ad sales up 9.1% and media sales up 13.1%. Media continues to be somewhat of a millstone with an operating profit of -1.5bn billion, while operating profits for advertising despite an increase in sales had dipped down by 37.4%.
Looking forward, CyberAgent are confident that two new major releases, Jujutsu Kaisen Phantom Parade and Final Fantasy: VII Ever Crisis will help shift the momentum back in favour of their games portfolio.