Elden Ring's success, including its Shadow of the Erdtree DLC, is a significant factor in the robust performance of Kadokawa's gaming division. This article delves into the impact of a recent cyberattack and analyzes Kadokawa's financial report.
Elden Ring and its DLC Power Kadokawa's Gaming Sector Growth
$13 Million in Losses Resulting from Kadokawa's Data Breach
On June 27th, the hacking group Black Suits claimed responsibility for a cyberattack targeting Kadokawa, FromSoftware's parent company. The attack resulted in the theft of substantial data, including sensitive business information and user data. Kadokawa confirmed on July 3rd that the breach compromised Dwango employee information, internal documents, and some data from affiliated companies.
According to Gamebiz, the breach cost Kadokawa approximately 2 billion yen (roughly $13 million), leading to a 10.1% decrease in net profit compared to the previous year. Despite this significant setback, Kadokawa reported strong first-quarter financial results for the fiscal year ending June 30, 2024. This is the first financial report since the June 8th cyberattack, which initially disrupted several company services.
Kadokawa has fully restored its business operations. While the publishing and IP creation sectors experienced temporary disruptions, a gradual recovery is underway, with a return to normal daily shipments expected by mid-August. Major affected web services are also resuming normal operations.
The video game sector showcased remarkable growth, achieving sales of 7,764 million yen—an impressive 80.2% increase year-over-year—and a 108.1% rise in ordinary profit. This exceptional performance is largely attributed to the phenomenal success of Elden Ring and its Shadow of the Erdtree expansion, providing a substantial boost to the gaming division's bottom line.
