KADOKAWA CORPORATION
9468・Prime Market・Information & Communication
Business
KADOKAWA Corporation is a comprehensive content company comprising six segments: Publishing & IP Creation, Animation & Live-Action Film, Games, Web Services, Education & EdTech, and Other Businesses. Across the group, including 57 consolidated subsidiaries and 11 equity-method affiliates, the company creates over 6,000 new IP titles annually, aiming to maximize the LTV (Life Time Value) of IP through media-mix development. Its main customers span general consumers, corporations, and educational institutions both in Japan and overseas, and the company is actively pursuing overseas expansion into North America, Asia, and Europe. Formed in 2014 through the business integration of KADOKAWA and Dwango, the company pursues Global Media Mix with Technology as its core strategy, under the corporate mission of "Becoming a creative platformer that connects the world's talent with inspiration."
Business Model
The Publishing & IP Creation Business generates over 6,000 new IP titles annually, expanding IP revenue opportunities across multiple layers through media mix initiatives such as anime, live-action film adaptations, game adaptations, merchandising, and events. Digital services including the e-book platform "BOOK☆WALKER," the video community "Niconico," and the correspondence high school N High School also form part of the revenue base, while global distribution expansion is being advanced through a capital and business alliance with Sony Group.
Company Strengths
The number of new IP created in FY2026 (ending March 2026) increased 9.3% year on year, surpassing 6,000 titles annually. The accumulated content archive serves as a source for media mix development, forming a structural competitive advantage that supports the group's overall earnings through secondary deployment into animation, games, merchandise, and other formats.
The Games Business achieved net sales of ¥29,636 million, operating profit of ¥7,541 million, and an operating profit margin of 25.4% in FY2026 (ending March 2026). The global brand strength and development capabilities cultivated through the ELDEN RING Series underpin the segment's high profitability, making it a standout profit-contributing segment within the group.
In December 2024, the company entered into a capital and business alliance agreement with Sony Group and implemented a third-party allotment of new shares. The two companies agreed on nine business alliance items, including joint investment, global live-action adaptation of IP, expansion of global distribution of animation works, and expansion of game publishing. Sony Group held 16,381,450 shares as of the end of March 2026, and the parties have committed to maintaining a long-term relationship.
ENVALITH's Perspective
Performance Trend
Revenue increased for five consecutive fiscal years, from ¥221,208 million in FY2022 (ended March 2022) to ¥282,908 million in FY2026 (ending March 2026), but the growth rate has decelerated (up 1.8% year on year in FY2026). Operating profit, on the other hand, peaked at ¥25,931 million in FY2023 (ended March 2023) and has declined for four consecutive fiscal years, reaching ¥8,102 million in FY2026, a decrease of 68.7% versus FY2023. The main causes were an increase in selling, general and administrative expenses (¥88,651 million), the Animation & Live-Action Film Business falling into an operating loss (-¥465 million), and the recording of goodwill amortization (¥2,700 million) as an extraordinary loss. External factors—including the shrinking domestic print publishing market, rising material and logistics costs, and a sharp increase in animation production costs—also weighed on earnings. Operating profit is forecast to recover to ¥10,100 million in FY2027 (ending March 2027), though sales trends for new Games titles will be key.
Growth Strategy
Aiming for ROE of 9.4% in FY2032 (ending March 2032) through Global Media Mix with Technology
Promoting indirect cost reductions through organizational reform and business process improvements in the domestic Publishing business, downsizing/withdrawal from unprofitable businesses, and improving return rates through manufacturing and logistics reforms. Some results were disclosed as having emerged in Q4 of FY2026 (ending March 2026), and efforts toward earnings improvement continue from FY2027 (ending March 2027) onward.
Accelerating expansion into Europe and Southeast Asia through the consolidation of Edizioni BD (Italy, made a subsidiary in May 2025) and SOZO Pte. Ltd. (Singapore, made a subsidiary in November 2025). Promoting expansion of the North American directly-operated "Manga Spot" stores (currently 10 stores), continued investment in multilingualization, and expansion of simultaneous e-book distribution.
Established a new production base, "Studio One Base," in Ikebukuro to consolidate group animation studios. In March 2026, established KADOKAWA Creators Co., Ltd., which integrates young talent development with production. Established Animex Co., Ltd., a domestic animation film distribution company, through joint investment with Aniplex Inc., to create a foundation for theatrical animation hits.
Expanding the production pipeline through the launch of new titles such as FromSoftware's new work "THE DUSKBLOODS" (scheduled for release in 2026) and Spike Chunsoft's "Super Danganronpa 2×2." In smartphone games, aiming to improve profitability through anime-based media mix strategies.
In the new medium-term management plan through FY2032 (ending March 2032), an ROE target of 9.4% has been set. Over the medium to long term, the company aims for an ROE of 12% or more and a total payout ratio of 50% or more. ROE for FY2026 (ending March 2026) declined significantly to 0.5% (from 3.4% in the previous year), and fundamental earnings improvement is needed to achieve the target.
Last updated: July 19, 2026