Capcom Reeling From Disastrous Financials

Capcom Japan has released a revised set of financials for the year in which the company backs away from its impressive profit forecasts made last year, in perhaps the most staggering reversal of income expectations seen anywhere within the industry of late.

Last year, Capcom posted profit projection of around £21 million, which overnight in Japan has been revised to an expected loss of somewhere in the region of £48.5 million.

It is thought that Capcom's somewhat lacklustre release schedule over the past year, combined with a seemingly rudderless green-light rationalisation process, is to blame. Slow sales in the home software sector have been compounded by under-performance in the firm's arcade division.

Indeed, Capcom's decision-making process has seemed at times bizarre to say the least. Offloading Red Dead Revolver and the outright canning of Dead Pheonix - both of which were highly anticipated titles - baffled fans, as did the company's decision to force the multi-platform roll-out of the dire Auto Modelista. Games such as Capcom Fighting All Stars, believed to be at an advanced stage of development for both the System 246 arcade platform and PlayStation 2, were also cancelled.

However, this may not be as disastrous as the surface presentation suggests for Capcom. The firm is expected to split arcade and home divisions at some point this year, coinciding with a quality-focused home console line-up that includes Killer 7 and Resident Evil 4 - without question two of the most anticipated games of this year.

Though Capcom will still make its 'traditional' mistakes, such as forcing a pointless release of Street Fighter III 3rd Strike and denying PAL gamers the chance of online play in Resident Evil Outbreak, it does appear that a very distinct strategy is emerging. Capcom is still backing innovative producers and financing their needs with a goal of releasing some of the best software the world has ever seen.