Capcom Shares Gain on Strong Quarterly Earnings, Improved Growth Outlook

By Jason Chau

Capcom shares surged in Tokyo after the Japanese game developer reported strong quarterly sales and earnings, boosting its growth outlook.

Shares rose as much as 20% Wednesday morning before paring some gains. The stock was recently up 18%, on track for its largest single day gain in 17 years.

The Osaka-based company posted a net profit of 29.16 billion yen, equivalent to $177.9 million, in the three months ended June, it said Tuesday. The figure was 70% higher from a year earlier and ahead of forecasts from analysts polled by LSEG.

Operating profit increased 67% on year, while quarterly net sales rose 55%.

The company attributed the earnings growth to strong sales of Pragmata, a new science-fiction action-adventure game released in April and the on-year doubling of sales in classic catalog titles from its flagship franchises, including Resident Evil, Monster Hunter and the last installment of Devil May Cry, which was released on Nintendo's Switch 2 platform last month.

Capcom's strategy to coordinate activities between its various businesses such as eSports and media and expand its Arcade locations also contributed to the profit growth, it said.

Still, the company maintained its net profit and operating profit forecasts for the current fiscal year at Y58 billion and Y83 billion, respectively.

Tuesday's results offer a much-needed boost to the game developer, whose valuation has come under pressure as gaming stocks have broadly underperformed over the past year. Investors have been concerned about uncertainty over game pipelines and the risk of intensifying competition from generative artificial intelligence, Nomura analyst Naruhito Miki said.

Capcom's recent updates regarding its game lineup, including the launch of Onimusha: Way of the Sword in September, a Resident Evil remake and an expansion pack for a Monster Hunter title, have also lifted market sentiment toward the stock, the analyst said.

"We think improvements to the pipeline outlook have increased prospects for profit growth... and think now is the time to reassess the stock," Miki added.

Write to Jason Chau at jason.chau@wsj.com

(END) Dow Jones Newswires

July 29, 2026 01:55 ET (05:55 GMT)