The company KADOKAWA published the November 6 its financial report for the second quarter of the fiscal year ending March 2026. The results show one decrease in income and profits, with net sales of 1,339.3 billion yen (1.8% less than the previous year) and one drop of 47.8% in operating profits, which were located at 55.5 billion yen.
The division of anime and live-action productions it was the most affected, with a fall of 20.4% in sales (210.3 billion yen) and one operating loss of 8.95 billion yen, contrasting with the 36.4 billion yen in profits registered in the same period of the previous year. According to the report, the main cause was that the proportion of first anime adaptations it was higher than that of sequels to established franchises, which reduced average revenue per title.
Impact of Doga Kobo and new strategies
Additionally, KADOKAWA noted that the loss was compounded by the amortization of 2.7 billion yen derived from the integration of Doga Kobo as a consolidated subsidiary. The study, acquired in the previous period, generated extraordinary spending that directly affected the results of the first half of the fiscal year.
In contrast, the area of video game it reported solid results thanks to the international success of ELDEN RING: NIGHTREIGN, released in May 2025. However, the publishing segment experienced lower profitability due to the increase in smaller scale titles and higher production costs.
Expected recovery with great titles
For the winter quarter, KADOKAWA plans recover ground with the premiere of popular franchises such as *Oshi no Ko* (third season) and *Medalist* (second season). In the fall quarter, the company participated in the production of titles such as *Watashi wo Tabeta Hito de Nashi*, *Chitose-kun wa Ramune Bin no Naka* and *Isekai Quartet*.
Regarding its division of live-action, KADOKAWA highlighted the contribution of films such as *Yamada-kun to Lv999 no Koi wo Suru* and *Mieruko-chan*, although income from secondary distribution rights was lower than the previous year.
With a schedule full of high-profile sequels for early 2026, the company is confident that its stronger franchises will allow it to reverse the negative trend.
