The Burden of Game Development and Advertising Costs
First written in FY2021. 16 of 24 entries say "Materialised", first in FY2023-Q1. Latest entry: 2026-09-18.
coly moved to the "Worse" side of this theme in 2023, 1 year after the typical company in this theme (2022).
The whole theme swung hardest in 2022: 3 of 6 companies on the "Worse" side.
0 other companies' latest entry also says "Materialised".
- FY2027-H1MaterialisedAnnual report
「Meanwhile, selling, general and administrative expenses increased year on year because development costs for new projects were incurred ahead of revenue.」
Costs for new development projects were incurred ahead of revenue, increasing selling, general and administrative expenses from ¥1,512.511 million in the previous period to ¥1,950.473 million and widening the operating loss from ¥95.586 million to ¥850.901 million. - FY2026MaterialisedAnnual report
「Selling, general and administrative expenses were ¥3,113.058 million, up 6.9% year on year. This was primarily due to research and development expenses related to new title development and other initiatives for medium- to long-term growth, which increased to ¥1,043.470 million, up 33.1% year on year. As a result, although selling, general and administrative expenses increased, the operating loss narrowed to ¥144.075 million from ¥516.473 million in the previous fiscal year.」
The increase in research and development expenses related to new title development, together with the increase in selling, general and administrative expenses, was reflected in results. Meanwhile, the operating loss narrowed from ¥516.473 million to ¥144.075 million. - FY2026-H1MitigatedAnnual report
「Selling, general and administrative expenses declined year on year, although costs for a collaboration project with a major entertainment company were incurred ahead of revenue.」
Costs for the collaboration project continued to be incurred ahead of revenue, while selling, general and administrative expenses declined year on year and the operating loss also narrowed from the same period of the previous year. - FY2025MaterialisedAnnual report
「Selling, general and administrative expenses were ¥2,911.369 million, up 9.8% year on year. Advertising expenses increased to ¥630.834 million, up 144.3% year on year, as advertising was deployed strategically before and after the release of the new mobile online game “Break My Case”. As a result, selling, general and administrative expenses increased and the operating loss was ¥516.473 million, compared with an operating loss of ¥813.715 million in the previous fiscal year.」
The increase in selling, general and administrative expenses resulting from advertising investment in the new title and other factors was reflected in results. Meanwhile, the operating loss narrowed from ¥813.715 million to ¥516.473 million. - FY2025-H1MaterialisedAnnual report
「Selling, general and administrative expenses increased year on year because substantial advertising expenses were incurred before and after the release of “Break My Case” and costs for a collaboration project with a major entertainment company were incurred ahead of revenue. As a result, for the current interim accounting period, sales were ¥2,736.768 million, up 34.4% year on year; the operating loss was ¥670.073 million, compared with an operating loss of ¥685.717 million in the same period of the previous year; the ordinary loss was ¥661.477 million, compared with an ordinary loss of ¥684.299 million; and the interim net loss was ¥687.322 million, compared with an interim net loss of ¥685.933 million.」
Selling, general and administrative expenses increased due to advertising for the new title and upfront costs for collaboration projects. Research and development expenses of ¥452.162 million and advertising expenses of ¥399.213 million were recorded. The cost burden continued, but the operating loss narrowed from the same period of the previous year. - FY2025-Q1MaterialisedAnnual report
「Selling, general and administrative expenses increased year on year because development costs for “Break My Case” rose as the title approached completion, advertising expenses were incurred immediately before its release, and costs for a collaboration project with a major entertainment company were incurred ahead of revenue. As a result, for the three months ended the first quarter, sales were ¥901.100 million, up 4.4% year on year; the operating loss was ¥498.552 million, compared with an operating loss of ¥400.026 million in the same period of the previous fiscal year; the ordinary loss was ¥504.055 million, compared with an ordinary loss of ¥399.966 million; and the net loss for the quarter was ¥524.735 million, compared with a net loss for the quarter of ¥400.749 million.」
Selling, general and administrative expenses increased due to costs for the title under development, advertising immediately before release and upfront costs for collaboration projects, widening the operating loss from ¥400.026 million in the same period of the previous year to ¥498.552 million. - FY2024MaterialisedAnnual report
「Selling, general and administrative expenses were ¥2,651.372 million, up 13.0% year on year. Research and development expenses increased to ¥807.802 million, up 51.2% year on year, as development costs rose for “Break My Case”, which was nearing completion, and development costs for a collaboration project with a major entertainment company were incurred ahead of revenue. As a result, selling, general and administrative expenses increased and the operating loss was ¥813.715 million, compared with an operating loss of ¥207.318 million in the previous fiscal year.」
Research and development expenses and selling, general and administrative expenses increased throughout the year due to titles under development, collaboration projects and investment in new businesses, widening the operating loss from ¥207.318 million to ¥813.715 million. - FY2024-Q3MaterialisedAnnual report
「However, selling, general and administrative expenses increased year on year because costs for “Break My Case”, which was under development, and a collaboration project with a major entertainment company were incurred ahead of revenue, and because upfront investment in new initiatives and new businesses was expanded. As a result, for the nine months ended the third quarter, sales were ¥3,283.650 million, down 11.1% year on year, and the operating loss was ¥898.771 million, compared with an operating loss of ¥323.287 million in the same period of the previous fiscal year.」
Costs related to titles under development, collaboration projects and upfront investment in new initiatives and new businesses were incurred, widening the operating loss from ¥323.287 million in the same period of the previous year to ¥898.771 million. - FY2024-Q2MaterialisedAnnual report
「However, sales declined year on year, substantially affected by sluggish sales from games currently in operation. In addition, upfront investment in new initiatives and new businesses increased, resulting in lower profit year on year.」
Upfront investment in new initiatives and new businesses increased, resulting in higher selling, general and administrative expenses year on year. Salaries and bonuses were ¥448.795 million and research and development expenses were ¥309.568 million, resulting in an operating loss of ¥685.717 million as the cost burden was reflected in results. - FY2024-Q1RestatedAnnual report
「However, sales declined year on year, substantially affected by sluggish sales from games currently in operation. Personnel expenses also increased year on year as a result of upfront investment in new initiatives and new businesses.」
Sluggish sales from games currently in operation and higher personnel expenses resulting from upfront investment in new initiatives and new businesses continued. The operating loss was ¥400.026 million in the first quarter. - FY2023MaterialisedAnnual report
「Selling, general and administrative expenses were ¥2,346.521 million, up 29.7% year on year. Personnel expenses increased as a result of upfront investment in new initiatives and new businesses, while research and development expenses related to the increase in titles under development rose to ¥534.356 million, up 10.8% year on year. As a result, selling, general and administrative expenses increased and the company posted an operating loss of ¥207.318 million, compared with operating income of ¥1,498.599 million in the previous fiscal year.」
Upfront investment in new initiatives and new businesses, together with increases in personnel and research and development expenses, was reflected in full-year selling, general and administrative expenses and the operating loss. - FY2023-Q3RestatedAnnual report
「As a result, although sales from permanent stores increased, sales declined year on year due to lower sales from existing titles, while personnel expenses, research and development expenses and other costs within selling, general and administrative expenses increased.」
Personnel expenses and research and development expenses continued to increase due to personnel expansion and new title development. Research and development expenses were ¥439.187 million and the operating loss was ¥323.287 million in the nine months ended the third quarter, showing that the investment and cost burden continued to affect results. - FY2023-Q2RestatedAnnual report
「As a result, although sales increased from new titles and permanent stores, sales declined year on year due to lower sales from existing titles, while research and development expenses and other costs within selling, general and administrative expenses increased.」
Research and development expenses related to new title development and other initiatives increased, while sales from existing titles continued to decline. Research and development expenses were ¥333.031 million and the operating loss was ¥173.001 million in the six months ended the second quarter, showing that the investment and cost burden continued to affect results. - FY2023-Q1MaterialisedAnnual report
「As a result, selling, general and administrative expenses, including research and development expenses and recruitment and training expenses, increased year on year.」
Research and development expenses and recruitment and training expenses increased in connection with the development of new titles and expansion of personnel, resulting in an operating loss of ¥78.038 million in the three months ended the first quarter. The burden of these costs was reflected in results. - FY2022RestatedAnnual report
「We seek to optimize costs by managing budgets versus actual spending for each game title and implementing advertising and promotion based on an assessment of cost effectiveness.」
The company continues to recognize the risk that development and advertising investments may not be recovered and that costs may exceed expectations, identifying budget-versus-actual management of development costs and verification of advertising effectiveness as responses. Advertising expenses were ¥472.501 million and research and development expenses were ¥482.412 million. - FY2021First statedAnnual report
「If rapid changes in user preferences or other factors result in returns that do not justify the investment, or if costs exceed expectations due to intensified competition for advertising placements or other factors, our results may be affected.」
The risk that investment in developing high-quality titles may not be recovered and that costs may exceed expectations as advertising exposure expands.