What Makes Konami the Most Money?
The short answer is video games, Yu-Gi-Oh!, and gambling machines. But let‘s dive deeper into the full picture…
Konami Holdings Corporation, commonly just called Konami, is a Japanese entertainment powerhouse. Since starting out in 1969 repairing jukeboxes, they‘ve grown into one of the biggest names in gaming worldwide.
But where exactly does their revenue come from in 2022? Which games, franchises and business endeavors make the most money for this industry giant?
As an avid gamer myself, I was curious to learn what‘s driving profits over at Konami. I decided to dig into their financials and business segments to get the full scoop.
In this post, I‘ll share what I discovered about the business workings of this legendary game company. You‘ll see how Konami makes most of its money, where they‘re focusing for future growth, and what it all means for the games we love. Let‘s jump in!
Konami‘s 4 Main Business Areas
Konami actually operates through four primary business units:
- Digital Entertainment – Video games division (console, mobile, trading card games)
- Gaming & Systems – Gambling machines division
- Amusement – Arcade games and management systems
- Sports – Owning soccer clubs and fitness clubs in Japan
Looking at how much revenue comes from each area provides great insight into Konami‘s money-makers.
Let‘s break down the numbers…
Digital Entertainment Dominates Revenues
In their 2021 fiscal year (through March 2022), Konami‘s total revenues were ¥271.9 billion (~$2.2 billion USD).
Of that amount, the Digital Entertainment segment accounted for a massive 78% of total revenue at ¥213.7 billion (~$1.72 billion USD). This includes their console games, mobile games, card games, and licensing income.
To put it into perspective, here is a breakdown of 2021 revenue by business segment:
| Division | Revenue (¥ billion) | Revenue (%) |
|---|---|---|
| Digital Entertainment | ¥213.7 | 78% |
| Gaming & Systems | ¥44.5 | 16% |
| Amusement | ¥13.7 | 5% |
| Sports | ¥2.3 | 1% |
With nearly 80% of revenues, it‘s clear their gaming business is Konami‘s biggest money-maker.
Major franchises driving Digital Entertainment revenue include:
- Yu-Gi-Oh! trading card game
- eFootball/Pro Evolution Soccer games
- Yu-Gi-Oh! Duel Links mobile game
- Castlevania games
This segment also delivered an outsized share of total operating profit at ¥68.2 billion (~87% of company-wide profit).
Bottom line – video games bring home the bacon for Konami. Now let‘s look at which games are pulling their weight…
Mobile Games Driving Growth
Within Digital Entertainment, mobile games have fueled strong growth recently.
In 2021, Konami‘s mobile revenue was ¥93 billion (~$746 million USD), up 34% year-over-year. Major mobile titles included:
- Yu-Gi-Oh! Duel Links (150M+ downloads)
- Powerful Pro Baseball
- Momotaro Dentetsu
Duel Links has been a cash cow mobile game for Konami. Sensor Tower estimates it has grossed an incredible ¥60 billion (~$480 million USD) worldwide since launching in 2016.
As an avid Duel Links player myself, I‘ve seen first-hand how popular it is. There‘s constantly new events and cards being added to keep players engaged.
With consumers shifting more towards mobile gaming, this segment will likely continue driving profits for Konami moving forward.
Yu-Gi-Oh! – The Gift that Keeps on Giving
No analysis of Konami‘s business is complete without looking at Yu-Gi-Oh!. Originally a manga series debuting in 1996, it has exploded into one of their most valuable properties spanning games, anime, cards, and merchandising.
But the real money-maker is the insanely successful Yu-Gi-Oh! Trading Card Game. Estimates say it alone brings in over $500 million yearly for Konami.
That‘s right – over half a billion dollars per year from cardboard cards! Here are some mind-blowing Yu-Gi-Oh! TCG stats:
- 35+ billion cards printed since 2002
- Available in over 80 countries
- More than 20 million players worldwide
- Thousands of unique cards released over 20+ years
With new sets and support constantly added to the game, its popularity shows no signs of fading. Konami is clearly milking this cash cow for all it‘s worth!
Beyond just the TCG, the Yu-Gi-Oh! franchise also includes:
- Video games (console, mobile, etc.)
- Anime series and movies
- Toys/merchandise
- Branded apparel/accessories
Yu-Gi-Oh! consistently ranks among Konami‘s top revenue and profit drivers each year. It‘s easy to see why it holds a special place in their heart!
Slot Machines – A Meaningful Revenue Stream
Now let‘s switch gears to Konami‘s second largest business segment – Gaming & Systems. This division accounted for 16% of total revenues in 2021 at ¥44.5 billion (~$358 million USD).
The lion‘s share of revenue here comes from slot machines installed in casinos worldwide. For example, Konami operates bank after bank of their games on the floor of major casinos like Wynn Las Vegas and Resorts World.
Popular slot titles include:
- China Shores
- Lotus Land
- Fortune Stacks
- Egypt Quest
They also generate income from casino management systems provided to gaming operators.
While not as sexy as talking frogs and vampire hunters, these gambling products provide meaningful diversification and revenues between major game releases.
Don‘t Forget "Pachinko" in Japan!
Speaking of gambling products, we can‘t ignore the elephant-sized market in the room – "pachinko".
Pachinko is a hugely popular type of arcade game in Japan that‘s used for gambling. Konami operates many pachinko parlors and is one of the largest manufacturers of the machines.
In 2021, pachinko accounted for approximately ¥25 billion (~$201 million USD) of Konami‘s Gaming & Systems revenue.
So while overlooked by many gamers in the west, pachinko is still a significant part of Konami‘s business.
Konami‘s Other Segments
Rounding out Konami‘s remaining business operations:
Amusement – This segment accounted for 5% of total revenues in 2021. It covers Konami‘s arcade gaming operations, including arcade management systems. With the decline of arcades, it‘s now a smaller part of their overall business.
Sports – Konami owns the Tokyo Verdy soccer club and fitness clubs in Japan. However, this segment contributes minimal revenue and profit compared to their gaming operations.
Where The Money Is At Konami
Looking at the full picture from their 2021 fiscal year:
- Total Revenue: ¥271.9 billion (~$2.2 billion USD)
- Operating Profit: ¥78.4 billion (~$630 million USD)
- Digital Entertainment was 78% of revenue and 87% of profit
Key money-making properties:
- Yu-Gi-Oh! (trading cards, video games, licensing)
- Pro Evolution Soccer/eFootball (games)
- Mobile games
- Slot machines
So in summary, video games, Yu-Gi-Oh! and slot machines are clearly Konami‘s biggest revenue and profit drivers currently.
The Future – My Take
Based on Konami‘s current trajectory, here are a couple personal opinions on where I see them heading in the future:
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Mobile gaming will continue growing in importance given the clear momentum and changing consumer landscape. I expect to see Konami bring more of its classic IP to mobile platforms.
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International markets provide an avenue for growth beyond stagnating domestic revenues. Recent pushes into Southeast Asia and consolidating different regions under one "Konami" brand have set the stage.
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Yu-Gi-Oh! and other intellectual properties will continue to be critical cornerstones of the business. Extending these franchises into new categories like movies/TV shows and leveraging for collaborations makes sense.
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Gambling provides reliable income to balance out major game release cycles. I think we‘ll see Konami look to expand their casinos business in places like North America where gaming/gambling culture continues growing.
While Konami certainly faces challenges ahead, their diverse business mix and wealth of IP provide the ingredients needed to profit from the continued growth of gaming worldwide.
I don‘t know about you, but I for one am excited to see what‘s next from this industry legend! Let me know if you enjoyed learning about what makes Konami tick as much as I did researching it.