Kadokawa
9468.TLOWScore: 22.6Virtual Events / IP Publisher · Weight: 8%· Data as of 2026-05-26
Investment Thesis
HOLD — FY2026 was a structural reset, not a secular decline. Revenue ¥282.9B (+1.8%) but OP -51.3% and NI -82.7% due to anime impairment + publishing restructuring charges. FY2027 recovery guided: Revenue ¥300.3B (+6.1%), OP ¥10.1B (+24.7%), NI ¥5.8B (+353.7%). Critical catalyst: FromSoftware has TWO major releases in H2 2026 — 'The Duskbloods' (Nintendo Switch 2 multiplayer exclusive) and 'Elden Ring: Tarnished Edition' (NS2 port) — both confirmed for 2026. Sony full acquisition abandoned (too costly at ¥675B); instead Sony bought 10% stake for ¥50B (Jan 2025) becoming largest shareholder. Strategic partnership: Sony adapts Kadokawa IPs into live-action films/TV and expands game publishing globally. Analyst consensus: 7 analysts, avg revenue ¥295.8B FY2027, EPS surge to ¥70.10 (+706% YoY as one-time charges reverse).
Risk
CONCEPT STOCK FLAG: VTuber-attributable revenue <<5% of total (Niconico/Dwango = ~20% revenue but direct VTuber exposure minimal — platform aging, losing share to YouTube). FY2026 NI near-zero (¥1.278B) distorts TTM PE to ~73x. Forward PE ~38x on recovery assumption. FromSoftware game delays or underperformance = biggest risk (gaming segment drives IP valuation). Sony relationship purely strategic — no consolidation benefits. Niconico structural decline continues with no turnaround catalyst. Annual dividend ¥30/share maintained (thin earnings coverage).
Monitoring Trigger
The Duskbloods and Elden Ring NS2 launch performance (H2 2026): if either title reaches top-10 Nintendo sales charts, UPGRADE conviction. FY2027 Q1 results (Jul/Aug 2026): if OP recovery on track toward ¥10.1B annual target, HOLD confirmed. If Sony strategic partnership leads to concrete IP adaptation announcements (e.g., Elden Ring live-action, FromSoftware IP film deal), UPGRADE. If Niconico MAU falls below 5M monthly actives, reduce position. Exit trigger: FY2027 OP misses guidance by >30%.
Key Dates
Key Metrics
Business Segments
| Segment | Revenue | Share | Description |
|---|---|---|---|
| Publication | ¥90B | 32% | Light novels, manga, books — restructuring underway |
| Animation & Live Action | ¥76B | 27% | Anime production, IP licensing — impairment charges hit FY2026 |
| Game | ¥67B | 24% | FromSoftware (Elden Ring, Armored Core, The Duskbloods 2026) |
| Web Services (Niconico) | ¥50B | 18% | Niconico streaming, virtual events — declining vs YouTube |
Supply Chain Evidence
| Evidence | Customer | Product | Detail |
|---|---|---|---|
| confirmed | Dwango/Niconico users | Streaming platform for VTuber content | Still active as Japan's legacy streaming platform that pioneered VTuber culture. Declining MAU but still a key historical VTuber distribution channel. |
| confirmed | Nintendo (Switch 2 platform) | FromSoftware exclusive — The Duskbloods multiplayer action RPG | The Duskbloods confirmed Nintendo Switch 2 exclusive for 2026 release. FromSoftware CEO Hidetaka Miyazaki developing new IP. Kadokawa confirmed 2026 release window Feb 2026. |
| confirmed | Nintendo Switch 2 owners (global) | Elden Ring: Tarnished Edition — NS2 port | Elden Ring Tarnished Edition for Nintendo Switch 2 confirmed alongside The Duskbloods for 2026. Extends FromSoftware IP to new platform audience. |
| confirmed | Sony Group (6758.T) | Strategic IP partnership — 10% equity stake (¥50B, Jan 2025) | Sony became Kadokawa's largest shareholder (12M+ shares, ¥50B). Full acquisition abandoned (cost ~¥675B = too high). Sony will adapt Kadokawa IPs into live-action films/TV and co-publish games globally. Partnership preserves Kadokawa independence while gaining Sony's global distribution. |