KLab inc.

Business Details

KLab Inc. and its consolidated subsidiaries provide mobile online games, mainly smartphone apps, worldwide. The business primarily features titles that leverage globally popular Japan-originated manga and anime IP, with charging revenue from users as the main revenue source. Apple Inc., Google Inc., and Xsolla (USA), Inc. are the major sales channels, and the business has a structure with a high proportion of overseas sales. In FY2026 (ending December 2026), the company has set "improving the fundamentals of the Game Business" as a management policy, and is pursuing both maximization of revenue from existing titles and development of new titles in parallel.

Recent Overview

Captain Tsubasa remained strong, but Game Business revenue declined 15.7% year on year due to widening decline of BLEACH and Haikyu!!

Game Business revenue in Q1 FY2026 (ending December 2026, January to March) was ¥1,377 million (down 15.7% year on year). While "Captain Tsubasa: Dream Team" maintained strong performance, the rate of decline widened for "BLEACH Brave Souls" and the support-model title "Haikyu!! FLY HIGH." The decline in the Game Business was offset by GPU server sales in the Other segment, resulting in companywide revenue of ¥1,706 million, up 4.3% year on year. Two new titles (Dragon Quest Smash Grow and My Hero Academia: United Survival) remain under development.

Key Products

Growth Drivers

• Expectations for new revenue contribution from two major new titles scheduled for release in 2026 (Dragon Quest Smash Grow and My Hero Academia: United Survival)
• Global expansion of games utilizing globally popular Japan-originated manga and anime IP (overseas sales ratio of approximately 61.5%)
• Improvement of the cost structure through thorough adherence to an elite, small-team approach and greater efficiency in development and operation systems
• Significant reduction of fixed costs through office downsizing/relocation and voluntary retirement programs (continuation of companywide cost control)
• Measures to improve hit rates by concentrating development on action RPG and sports simulation genres
• Clear articulation of a revenue recovery scenario following the release of new titles, as reflected in the announced full-year earnings forecast (revenue of ¥17,000 million, operating profit of ¥1,000 million)

Risks

• Structural decline in revenue due to continued widening of the decline of existing flagship titles (BLEACH Brave Souls, Haikyu!! FLY HIGH) (Game Business revenue down 15.7% year on year in Q1 2026)
• Risk of changes to release plans due to development delays or failure to meet quality standards for new titles (trend toward longer development periods)
• Risk of decline among overseas users (given the structure with a high proportion of overseas sales)
• Risk of large-scale impairment of software in progress (balance of software in progress of ¥3,556 million as of the end of March 2026)
• Risk of fee structure or policy changes by platform operators such as Apple and Google (the two major companies account for approximately 50.8% of revenue)
• Achievement of the full-year earnings forecast (revenue of ¥17,000 million) is premised on a substantial revenue contribution from new titles, creating a high risk of falling short