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Bandai Namco - Annual Integrated Report and Fact Book FY3/2021

ggx2ac

ggx2ac

Member
Expert
(They publish Dark Souls)
These are the recently released Annual Report and Fact Book covering the fiscal year ending March 2021.

Bandai Namco
Annual Integrated Report FY3/2021:

Fact Book 2021:

A few quotes and images from the annual report:

President's Message, Masaru Kawaguchi (President and Representative Director BANDAI NAMCO Holdings Inc.):
Entertainment Unit
Fusion of Digital and Physical Elements

The Entertainment Unit resulted from the combination of the former Toys and Hobby Unit and the former Network Entertainment Unit. With a focus on the future, we decided that now, when both Units have favorable results, was the best time for a reorganization to succeed in intense global competition. The new system combines digital elements (content business) and physical elements (tangible products business), and it can leverage a wide range of outlets. This system is unique in markets around the world, and it will be a major point of differentiation versus other companies.
Furthermore, to promote the integration of the businesses and encourage employees, we are implementing personnel exchanges among the directors of the business companies.

The Entertainment Unit accounts for a large percentage of Group sales, and from the outside our structure might appear somewhat unbalanced. We took our time and held repeated discussions from a variety of angles, and we decided that the Unit combination was necessary to expand business opportunities and achieve growth. The transition to the new system through this process, as we develop a common understanding of the issues that we face, is having positive knock-on effects in a variety of areas.

For example, in FY2022.3 we conducted multiple Groupwide projects that extended throughout the organization, such as the Gundam Project. On the front lines, we also launched a number of independent projects that extend across organizational boundaries. These types of activities that transcend organizational boundaries are also proving to be useful in the formulation of the next Mid-term Plan.
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Yasuo Miyakawa,
Director (Part-time)
In charge of Digital business, Entertainment Unit BANDAI NAMCO Holdings Inc.
President and Representative Director
BANDAI NAMCO Entertainment Inc.:
The Entertainment Unit was created
through the combination of the
former Toys and Hobby Unit and the
former Network Entertainment Unit.
The Unit comprises the Digital business and the Toys and Hobby business. BANDAI NAMCO Entertainment Inc. and BANDAI CO., LTD. are responsible for each business, and both companies work together to oversee the entire Unit.

In FY2022.3, the first year since the
combination, in addition to advancing
our businesses we will work to bolster our foundation by implementing a variety of future-focused investment and building a new Unit organization. Overall, the Entertainment Unit will advance three main strategies.
First, we will maximize IP value through the use of diverse content outlets. Second, we will further strengthen collaboration around the world. And third, we will create new entertainment that integrates digital and physical elements. In advancing these strategies, we will launch a variety of Unit-wide projects and pursue future possibilities with a
sense of urgency.

To maximize IP value, we launched multiple cross-sectional projects for strategic IP, such as Gundam. With the participation of the leadership of each company, we are working to formulate business strategies and foster collaboration in products and services. To further strengthen collaboration around the world, we are implementing reorganizational measures and consolidating offices in each region, such as combining the Digital business company and the Toys and Hobby business company in China.
Through these initiatives, each region will foster enhanced unity under the ALL BANDAI NAMCO
concept and build systems for the advancement of strategies during the next Mid-term Plan. Around the world, the Digital business and the Toys and Hobby business will step up integration and cooperation. In addition to IP originating in Japan, we will focus on creating and rolling out IP originating overseas. Targeting the creation of new entertainment, we are promoting a variety of projects that started on the front lines. In addition, we have operated a proposal system with the participation of Unit employees.
Moreover, in addition to working within the Group, as an open Group we are aggressively advancing partnerships with outside personnel, companies, etc.
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Naoki Katashima,
Senior Managing Representative Director
BANDAI NAMCO Entertainment Inc.
Joined NAMCO BANDAI Games Europe S.A.S. (currently, BANDAI NAMCO Entertainment Europe S.A.S.) in 2008. Served as president and officer of business companies in Europe and the Americas, and worked to expand the Digital business overseas, centered on games. Moved to current position in April 2021.:
I worked in the Digital business for more than 10 years, centered on Europe. In the Digital business, global competition is intensifying, due in part to a succession of companies entering the market from different industries, in addition to the traditional game companies. Moreover, the business environment is undergoing dramatic change due to the acceleration of digitalization on a global scale as a result of the influence of COVID-19. In this setting, my mission is to leverage the overseas experience that I accumulated over many years, and to accelerate global development initiatives under the ALL BANDAI NAMCO concept. In the Company’s Digital business, which is represented by network content and home video games, the overseas sales ratio is more than 50%. However, in consideration of the fact that the scale of the overseas market is overwhelmingly large in comparison with the market in Japan, there is room for further growth in our overseas sales ratio. To that end, in accordance with the premise that Japan is a single region of the world, it is important that we think from a more global perspective. I believe that my role also includes working to cultivate this mindset throughout the Group.

In network content and home video games, due to changes in the environment and to diversification of consumer behavior, there is a shift in the main business model, from a model where revenues end with the sale to a model based on providing content over the Internet, etc. (long-lived products). In this setting, the DRAGON BALL Z DOKKAN BATTLE smartphone game app continues to maintain its popularity even today, more than six years after the launch of online distribution in 2015. This has become a model of successful initiatives in the realization of long-lived products. Operational factors play a key role in the development of long-lived products. With focus on customers having fun, we implement ongoing initiatives that lead to long-term sustainability. For example, we analyze customer activity within a game and other factors, and we add new elements, implement updates, and hold in-game events. This style, in which we listen to feedback from customers and work together with them to nurture games, is behind the success of DRAGON BALL Z DOKKAN BATTLE. This type of experience is also reflected in long-selling titles based on other IP, such as the Tales of ... series.

Furthermore, in home video games, sales of TEKKEN7, which was launched in 2017, continue to be favorable. Cumulative total shipments have surpassed 7.5 million units (as of May 2021), and more than 90% of those were sales in Europe and the Americas. Sales of download content and digital items and the implementation of in-game events have contributed to this performance, and in addition I think that this is a result of careful community management with close ties to local regions, such as the implementation of esports in countries in Europe and the Americas.
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Images from the Annual Report 2021:
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From the Fact Book 2021:
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The following is from last year for comparison:
Annual Integrated Report FY3/2020: https://www.bandainamco.co.jp/cgi-bin/releases/index.cgi/file/view/10030?entry_id=6971

Fact Book 2020:

Screenshot_20201023-1751112.png

Screenshot_20201023-1757182.png

Screenshot_20201023-1757472.png

Screenshot_20201023-1753592.png

From the Fact Book 2020:
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Screenshot_20201023-1733362.png
 
Ultimate Ninja Storm series selling 5 millions of units last year, 25% of the total sales. Even with big discounts, that's a lot of money.

They aren't going to stop making more games.
 
tolkir said:
Ultimate Ninja Storm series selling 5 millions of units last year, 25% of the total sales. Even with big discounts, that's a lot of money.

They aren't going to stop making more games.
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CC2 coming back to Naruto for a proper Boruto game, I guess

how did that Ninja Strikers game do in the end?
 
Oregano said:
I'm surprised they continue to post the JP publisher market share graphs, because they're trending the wrong way for them.
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Was about to say that. If they essentially decided to ignore that huge elephant in the home market internally, why still point to it in your own publications?
 
Development investments have been super-stagnant since 2019. Does anyone know why? Games are becoming more and more expensive to make, whether it's PC, console or mobile. One can shrug off the decreasing console market share in Japan by pointing to mobile, the west, IP licensing, and whatever else, but if I were a Bandai Namco investor, I would find that stagnant R&D number for 3 years in a row troubling at best, alarming at worst.
 
Oregano said:
I'm surprised they continue to post the JP publisher market share graphs, because they're trending the wrong way for them.
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Maybe they are using it to justify their biases and their "aim for the West".
 
tolkir said:
Ultimate Ninja Storm series selling 5 millions of units last year, 25% of the total sales. Even with big discounts, that's a lot of money.

They aren't going to stop making more games.
Click to expand...


Namco is making banks with Catalogue Games and most of them including Tekken, Jump force, MHA are getting dlc/mtx/season pass to keep the community engaged and helping them with a rise of network revenue
 
I might get Kakarot for Switch when it drops to 10 to 15. Never again buying a Bandai game at full price. I feel those deep discounts help them in the digital ratio.
 
DarkDetective said:
Development investments have been super-stagnant since 2019. Does anyone know why? Games are becoming more and more expensive to make, whether it's PC, console or mobile. One can shrug off the decreasing console market share in Japan by pointing to mobile, the west, IP licensing, and whatever else, but if I were a Bandai Namco investor, I would find that stagnant R&D number for 3 years in a row troubling at best, alarming at worst.
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Less projects, but higher budget ones?

Bandai Namco used to have an overwhelming volume of releases compared to the other publishers but it seems they have slowed significantly.
datschge said:
Was about to say that. If they essentially decided to ignore that huge elephant in the home market internally, why still point to it in your own publications?
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Yeah, seems like I would just stop reporting on it.
 
When EA and Acti-Blizzard cut down on the number of titles in their catalog and consolidated around AAA, their R&D cost still kept going up to keep up with the arms race. I suppose it's easier to afford if you're shipping CoD or FIFA every year.
 
Lelouch0612 said:
Their output has been quite disappointing in terms of quantity over the past year.

But apparently, things should pick up next year. Interested to see the extent of it.
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Presumably they'll have the entire staff they had working on Smash free to do something else.
 
Its going to be interesting when this years Top 100 is released by Famitsu, despite only having: an year and change old port of Kakarot, Little Nightmares 2, Super Robot Wars 30 as major releases on the Switch, due to those titles and catalog sales of Taiko & Fishing Spirits I anticipate Switch sales to out perform Tales of Arise and Scarlet Nexus and other PS games.

No matter how little of a priority Switch seems to be for Bandai since Harada took over, the sales on the platform continue to be the only thing that will keep Bandai as a top 5 publisher in Japan.
 
tolkir said:
Shinobi Striker? It did 2 million units last month.
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Really impressive result.

Dark Souls III - 10 million as of May 2020
Dragonball FighterZ - 8 million as of November 2021
Dragonball Xenoverse 2 - 8 million as of November 2021
Naruto Shippuden Ultimate Ninja Storm 4 - 7.8 million as of October 2021
Tekken 7 - 7 million as of April 2021
Dragonball Z Kakarot - 4 million as of October 2021
Little Nightmares - 3 million as of September 2021
Ace Combat 7 - 3 million as of August 2021
Naruto to Boruto Shinobi Striker - 2 million as of September 2021
Little Nightmares II - 2 million as of August 2021
Soul Calibur VI - 2 million as of July 2021
Project CARS - 2 million as of October 2016
Tales of Berseria - 2 million as of September 2021
Tales of Zestiria - Between 1.3-1.7 million as of March 2021
Tales of Arise - 1.5 million as of October 2021
Tales of Vesperia: D.E. - 1.5 million as of September 2021
Man of Medan - 1 million as of August 2020
Code Vein - 1 million as of February 2020
 
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