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Chapter 557: Finance Report Part 2
🕑 Added 2025-08-03 02:25:34 +0000 UTCThe meeting continued as the focus shifted toward discussing the sales performance of arcade games and PC games. Sayuri took the lead and addressed the room, "Alright, let's begin. As of now, we have successfully launched and distributed a total of 9 standard arcade machines and 5 specialized arcade machines across various markets worldwide."
“First of all, most standard arcade units cost us about 200,000 yen to produce per unit, and we sold them to arcades at a price range between 500,000 and 580,000 yen,” Sayuri explained, her tone precise and confident. Zaboru and the other ZAGE executives nodded in unison, listening closely. Sayuri continued, “For the units priced at 500,000 yen, those titles include: Rampage, Street of Rage, 1942, Captain Commando, and Joe and Mac. Altogether, these five titles sold a combined total of roughly 30,000 units across global markets. With each sale earning us a profit margin of 300,000 yen, that alone has given us a strong revenue figure of approximately 9 billion yen.”
She paused for a brief breath before pressing on. “Now, moving to the mid-range priced arcade machines at 550,000 yen, we had the fighting game giants: Street Fighter, Mortal Kombat, and Marvel ZAGE. Street Fighter alone managed to sell 30,000 units, while Marvel VS ZAGE and Mortal Kombat each secured around 25,000 units. That brings the total to roughly 90,000 units sold across this price bracket. For each of these, we gained a solid 350,000 yen per unit, translating to a remarkable profit of 31.5 billion yen.”
Zaboru and the other ZAGE executives clapped enthusiastically. The success of the fighting game genre in arcades was undeniable, and their expressions showed a mixture of pride and optimism for the direction ZAGE was heading.
Then Sayuri continued, “As for Tekken, we sold it at a premium price of 580,000 yen per unit due to its cutting-edge 3D capabilities and the fact that it had only recently been released in July. Being one of the pioneers in 3D arcade fighting games, Tekken quickly gained popularity among arcade-goers. By the end of 1994, it had achieved an impressive sales figure of 13,000 units worldwide. Each unit generated a solid profit of 280,000 yen, bringing in a substantial total of 3.64 billion yen in profit.
Taking into account this success, combined with the previous revenue from standard and mid-range arcade titles, our total earnings from regular arcade sales alone amounted to approximately 44.14 billion yen. This is a highly commendable achievement and speaks volumes about the popularity and commercial strength of our arcade division.”
Sayuri then continued, "Next, let's talk about special arcade machines. These units are significantly more expensive and complex to manufacture, which is why their production volume remains limited. However, when they succeed, they bring in substantial revenue."
She began, "First, we have the UFO Catcher. The machine itself costs about 300,000 yen to produce, including the cost of the prizes. We sold each unit for roughly 700,000 yen. Globally, we managed to sell approximately 3,000 units, which generated a strong 1.2 billion yen in total revenue."
She shifted smoothly to the next machine. "Now, regarding the OutRun arcade machine—it required a much higher production investment, with costs reaching around 600,000 yen per unit. We priced it at 1.1 million yen, and thanks to strong demand, we sold about 4,300 units worldwide. This brought in a healthy return of approximately 2.15 billion yen."
As for the next machine, Dance Dance Revolution—it cost us approximately 450,000 yen per unit to manufacture, primarily due to its specialized footpad controls and motion-sensitive interface. We priced it at 900,000 yen for arcades, effectively doubling our investment per unit. Thanks to the rapidly growing dance game craze and catchy music tracks, it quickly became a global phenomenon. By the end of the year, it sold around 4,000 units across arcades in Japan, the USA, and parts of Europe, resulting in total revenue of approximately 1.8 billion yen.
Following that, we have Virtual Cop, which launched just this past September. Its development and production cost us about 350,000 yen per unit, a relatively modest figure considering its groundbreaking light-gun shooting gameplay and realistic crime-fighting scenarios. We sold each unit at a market-friendly 800,000 yen. In just four months, it managed to sell around 3,500 units, largely driven by its immense popularity in the American arcade market. The game's appeal was bolstered by positive reviews, word-of-mouth buzz, and strong co-op gameplay. As a result, it has already generated approximately 1.575 billion yen in revenue, a clear indicator of its potential for continued success in the coming months.
And finally, released just last month, Guitar Hero has already seen a solid early performance with 2,000 units sold in its first few weeks. The production cost per unit was approximately 450,000 yen, and we priced it at 950,000 yen when selling to arcades. This pricing strategy allowed us to earn close to 1 billion yen from Guitar Hero alone, marking a strong debut and validating its commercial viability.
Adding this to the performance of our previously mentioned special arcade machines—UFO Catcher, OutRun, Dance Dance Revolution, and Virtual Cop—the combined revenue from these specialized units amounts to a noteworthy 7.725 billion yen. Considering all categories of arcade sales, both standard and specialized, the total revenue generated by our arcade division currently stands at an impressive 52.135 billion yen. This reflects the sustained demand and popularity of our arcade offerings across global markets, showcasing both innovation and strong market execution.
Zaboru nodded thoughtfully, prompting Zanichi to chime in. "It might seem like the special arcade machines aren't performing well in terms of sales, but that's a bit misleading. The actual demand for these units is consistently high across multiple regions. The real issue lies in the high cost and complexity of manufacturing them. Each machine requires a tremendous amount of resources and effort to produce, which makes it difficult for us to meet the growing demand from arcade operators—even with Nanco’s manufacturing teams already providing assistance."
Zaboru nodded again in agreement. "That’s true. Maybe it’s time we consider establishing an additional manufacturing facility or partnering with another arcade production company in the future. That way, we could significantly ramp up production to meet the global demand."
Zaboru gave another approving nod, his expression calm but intent, as Sayuri readied herself to transition smoothly into the next section of the report. The executives around the room adjusted their posture in anticipation, signaling their continued focus as the meeting pressed forward.
“Okay, next is the report from the PC Games department,” Sayuri announced, projecting a new slide onto the screen. “Aside from our two flagship titles, Diablo and Fallout, our PC game division has still performed admirably, contributing a total of 6 billion yen in revenue this year from other titles.”
She took a moment to steady her voice before diving into the numbers. “As for Diablo, which we launched at a retail price of 9,000 yen or approximately $45, it has become one of our most PC successful titles to date. Since its release, it has sold a staggering 1.5 million units worldwide. Considering the game cost us around 3,000 yen per unit to develop and produce, the resulting revenue stands at approximately 13.5 billion yen, giving us a gross profit of around 9 billion yen.”
Zaboru clapped with satisfaction, joined by the other ZAGE executives, who exchanged impressed glances. Sayuri gave a small nod of acknowledgment and continued, “Now, moving on to Fallout. This game shares the same pricing model as Diablo, retailing at 9,000 yen with a production cost of 3,000 yen. Since its launch, it has sold approximately 500,000 units. That translates to roughly 4.5 billion yen in revenue and a net profit of around 3 billion yen.”
She clicked the remote to highlight the final summary on the screen. “In total, our PC games division has generated an impressive 18 billion yen in revenue. This figure underscores the growing strength and global reach of our PC gaming strategy and suggests ample opportunity for even more growth in the coming fiscal year.”
Shinsuke then raised a concern to Zaboru. “Boss, Fallout is doing extremely well in the US and Europe, if I’m not mistaken, right? But it doesn't really seem to be catching on here in Japan—not like Diablo. Do you think it's because of the nuclear themes?”
Zaboru let out a sigh, his expression contemplative. “Yeah, that seems to be the case. Our players here are still pretty sensitive about anything related to nuclear disasters. The post-apocalyptic setting and all the radiation stuff make people uneasy. It’s not something many Japanese gamers want to immerse themselves in. On top of that, Diablo got a big boost in exposure when it was featured during the Windows 94 Showcase, which Fallout didn’t benefit from. But well, it is what it is. Let’s move on.”
Sayuri nodded confidently, gathering her notes before smoothly transitioning to the next segment of the meeting, which focused on the remaining revenue and cost breakdowns. Her tone remained composed and authoritative as she prepared to delve into the next set of financial figures.
She then continued, "As for other revenue streams such as merchandise—this includes toys, action figures, T-shirts, and various other branded items—we have generated approximately 55 billion yen . This figure comes after we factored in reduced production costs. Our toys and action figures, in particular, are enjoying tremendous popularity, which has played a significant role in driving this revenue."
Zaboru was momentarily surprised, but a smile crept across his face. Toys and merchandise had always been one of the most lucrative parts of the business, and he was well aware of their enduring appeal. He figured there would likely be even more merchandise opportunities in the future. Zaboru had already acquired a commanding 90% stake in HanDai, leaving only 10% still held by Mitoma, who had since become the company's CEO.
Mitoma, for his part, was thrilled—he had essentially struck gold with minimal effort. Zaboru had no intention of taking that last 10% from him. In fact, he planned to let Mitoma retain it because, for all his obsession with money, Mido Mitoma was undeniably a capable man. He might be greedy, but he wasn’t stupid. Without ZAGE’s involvement and strategic backing, neither HanDai nor Mitoma would’ve had the chance to earn this level of profit. Zaboru recognized this—and that mutual benefit kept the partnership solid.
Sayuri then continued, "Regarding our animated content this year, we had several successful series contributing to our overall revenue. In Japan, Gundam and Pokémon continued to perform strongly, attracting massive viewership and driving related product sales. Over in the United States, we had Transformers and X-Men: The Animated Series, both of which remained popular with younger audiences. Additionally, the early episodes of SpongeBob SquarePants began airing in the US market until mid Year, gaining traction faster than anticipated. Altogether, these five animated series brought in approximately 4 billion yen in revenue.
Shinsuke nodded and said, "While it's not as massive as merchandise, animated shows do help us generate more revenue from merchandise—especially with Gundam action figures, which are booming these days, right boss?"
Zaboru nodded in agreement. "That's true. Animated shows are crucial for our growth, and I've already made plans to expand this sector further in the future."
Sayuri then continued, "Next, moving on to Hakushensha’s manga and magazine division—our publishing and book-related revenue reached approximately 20 billion yen. The vast majority of this came from the continued success of our flagship publication, ZAGE POWER monthly magazine. Every issue this year has completely sold out, reflecting the overwhelming demand and loyal readership we've cultivated."
Zaboru nodded, prompting Sayuri to summarize the financial results in a confident tone. "To summarize, our revenue this year—derived from the total sales of game consoles, game cartridges, arcade machines, PC games, merchandise, animated shows, as well as magazines and manga—amounts to an impressive 307.265 billion yen. Converted at the exchange rate of 1 USD = 200 yen, that translates to approximately 1.536 billion US dollars. Importantly, these figures already reflect deductions for production costs, so this represents our net revenue for the year 1994. It's a clear indication of our company's excellent financial health and the outstanding performance of our diverse product lines across multiple markets."
Zaboru smiled and applauded, joined by the other executives who echoed his enthusiasm. Sayuri then continued, "As for our expenses, the total cost amounted to 530 million US dollars, or approximately 106 billion yen."
Zaboru nodded thoughtfully, recognizing that this figure likely accounted for a broad spectrum of expenditures—including new investments, acquisitions, the construction of ZAGE Tower, and company-wide employee salaries and bonuses. Despite the high figure, he appeared fully satisfied, knowing these were necessary costs to sustain and grow the business.
After allowing a moment for the room to absorb the figures, Sayuri smoothly transitioned back to her notes and continued presenting the remainder of the meeting. With the detailed financial overview now complete, the Finance Meetings of 1994 officially concluded, giving way to Zaboru's segment on strategic planning and development goals for the upcoming year.
To be continued
AN = this chapter is a nightmare to make i probably won’t make another chapter like this and in future i might just create brief total sales. This feels like work to me. I don't enjoy making this type of chapter at all. Research , Cross-check , uggh.
