Kadokawa (9468) Q2 2025 earnings summary

Executive summary

• Revenue for the first half of FY2025 rose 9.8% year-over-year to ¥136.3 billion, with operating income up 23.5% to ¥10.6 billion, despite a major cyberattack disrupting operations in Q2.

• Net income attributable to shareholders fell 25.0% to ¥3.1 billion due to a special loss from the cyberattack impacting Niconico services.

• Key segments—Publishing/IP, Anime, Games, and EdTech—delivered robust growth, offsetting cyberattack-related declines in web services.

• EBITDA increased 23.4% year-over-year to ¥14.3 billion.

• Cyberattack in June 2024 caused significant system outages, impacting publishing and web services, but recovery was largely completed by September.

Financial highlights

• 1H FY2025: Revenue ¥136,320M (+9.8% YoY), Operating Income ¥10,626M (+23.5% YoY), EBITDA ¥14,307M (+23.4% YoY).

• Q2 (July–September): Revenue ¥70,459M (+7.8% YoY), Operating Income ¥4,597M (−13.9% YoY), with cyberattack impact peaking in this quarter.

• Net income attributable to shareholders for 1H: ¥3,096M (−25.0% YoY).

• Full-year FY2025 guidance: Revenue ¥271,700M (+5.3% YoY), Operating Income ¥16,300M (−11.7% YoY), Net Income ¥9,000M (−20.9% YoY), EBITDA ¥24,100M (−5.0% YoY).

• Gross profit margin improved as gross profit rose to ¥50.3 billion from ¥41.1 billion year-over-year.

Outlook and guidance

• Cyberattack impact expected to be mostly absorbed by Q2; full-year sales and operating income guidance revised upward due to strong anime and web service recovery.

• Downward revision for net income due to foreign exchange losses and higher costs, despite reduced special losses from the cyberattack.

• Game segment outlook revised downward due to delays and lower-than-expected performance in some titles, but anime and web services revised upward.

• EBITDA for the year is forecast at ¥24.1 billion (−5.0% YoY).

• Full-year outlook subject to risks from further cyber incidents, cost increases, and forex volatility.