Tecmo plans mobile, online focus as 2005 profits fall

Japanese publisher Tecmo has announced that it plans to reorganise its operations to focus more on its online, mobile and gambling divisions, after the poor performance of key console titles caused a profit shortfall in its 2005 figures.

The company, which is best known outside Japan for the Dead Or Alive, Ninja Gaiden and Project Zero (Fatal Frame) titles, hopes to follow in the path of other Japanese publishers such as Square Enix and become a major content provider on mobile networks and through online games.

The move comes after the firm's net profit plunged by some 57 per cent from 1.4 billion Yen (10.2 million Euro) in 2004, to 617 million Yen (4.4 million Euro) in the 2005 fiscal year, which came to a close on December 31st.

The shortfall came despite a significant rise in sales, with the firm's headline revenues climbing from 7.9 billion Yen (56 million Euro) in 2004 to 12.2 billion Yen (86.5 million Euro) in fiscal 2005, and the blame for the decline was pinned squarely on the performance of Tecmo's console products.

More specifically, the company fingered the delay to Dead Or Alive 4 on the Xbox 360 as a major factor, with the month-long delay to the game pushing the vast bulk of its revenues into fiscal 2006 - since it only arrived in Japan on December 29th, two days before the end of the financial year.

Other games such as Tokobot on the PSP and Monster Farm 5 on the PS2 also performed below expectations, which all contributes to a somewhat bleak picture for Tecmo's console operations - although other titles, including Project Zero 3, performed within expectations.

The company now plans to focus away from console products in future, with a pledge to invest more in the development of its Pachinko/Pachislot gambling products, new online games, and mobile games and content.

The firm will by no means be pulling out of the console market, of course - with franchises like Dead or Alive, Monster Farm, Project Zero and Ninja Gaiden, Tecmo remains a hugely successful publisher, by and large, and it has announced plans to support all three of the next-generation consoles.

Restructuring the firm to focus on the new areas will come at a certain cost, too. For the financial year 2006, Tecmo has forecast a drop in sales of 3.8 per cent, to 11.8 billion Yen (83.6 million Euro), and a further drop in net profit of 10.8 per cent, down to 550 million Yen (4 million Euro).