What is Brief History of Capcom Company?

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What is the brief history of Capcom?

Capcom has been a major player in video games for decades, creating many beloved titles. The company started in 1979 as I.R.M. Corporation, initially focusing on electronic game machines.

The company officially became Capcom Co., Ltd. in 1983, marking its transition into software sales and laying the foundation for its future success. This period was crucial in establishing the company's identity.

A significant milestone was the 1991 release of Street Fighter II, which revolutionized the fighting game genre. For the fiscal year ending March 2025, Capcom reported impressive financial results, with net sales of ¥169.6 billion and a net profit of ¥48.45 billion, continuing a trend of 12 consecutive years of operating income growth. This sustained performance highlights the company's enduring appeal and strategic execution, as further detailed in a Capcom Porter's Five Forces Analysis.

Capcom's journey began on May 30, 1979, when Kenzo Tsujimoto established I.R.M. Corporation in Matsubara, Osaka, Japan. Tsujimoto, already involved with Irem Corporation, leveraged his entrepreneurial drive, previously seen in ventures like selling cotton candy and pachinko machines, to enter the burgeoning electronic game market.

The Genesis of Capcom

The foundation of Capcom, then known as I.R.M. Corporation, marked the initial steps of a company that would profoundly shape the video game industry. Kenzo Tsujimoto's vision was to create engaging electronic entertainment, a goal that would soon lead to the development of iconic arcade titles.

• Capcom's origins trace back to May 30, 1979, with the establishment of I.R.M. Corporation.
• Kenzo Tsujimoto founded the company, demonstrating an early entrepreneurial spirit.
• The initial focus was on manufacturing and distributing electronic game machines.
• The company's evolution involved name changes and strategic restructuring to focus on game software.

In September 1981, I.R.M. Corporation and its subsidiary, Japan Capsule Computers Co., Ltd., were renamed Sanbi Co., Ltd. A pivotal moment in the company's history occurred on June 11, 1983, when Tsujimoto founded Capcom Co., Ltd. in Hirano, Osaka. This new entity was specifically created to manage the internal sales department for game software. The name 'Capcom' itself is a portmanteau of 'CAPsule COMputer,' a term chosen to distinguish their arcade machines and to encapsulate their philosophy of creating games that were 'a capsule packed to the brim with gaming fun.' This also served as a measure to protect their intellectual property. The formal merger of Capcom Co., Ltd. with Sanbi Co., Ltd. in January 1989 solidified the structure of the current Japanese branch. The company's very first product was the medal game 'Little League,' released in July 1983, followed by 'Fever Chance' in October 1983. The company's inaugural arcade video game, 'Vulgus,' was launched in May 1984, marking its entry into the competitive video game development scene. These early endeavors were crucial in building the foundation for what would become a global entertainment powerhouse, with its Target Market of Capcom evolving significantly over the years.

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Capcom's early history is marked by a swift ascent within the arcade gaming sector. Initially focusing on medal games, the company quickly pivoted to video games, releasing its first arcade title, 'Vulgus,' in May 1984. This was followed by a series of successful arcade games, laying the groundwork for its future expansion.

Capcom's Arcade Beginnings

Capcom's journey began in the arcade industry, moving from medal games to video games. The release of 'Vulgus' in May 1984 signaled its entry into video game development, quickly followed by 'SonSon' and 'Pirate Ship Higemaru' later that year.

International Market Focus and US Expansion

With '1942' in November 1984, Capcom started designing games with international appeal. This global outlook was reinforced by the establishment of CAPCOM U.S.A., INC. in California in August 1985, enhancing its reach in the United States market.

Transition to Home Consoles

The mid-1980s saw Capcom achieve significant success with arcade hits like 'Commando' and 'Ghosts 'n Goblins.' These triumphs paved the way for its entry into the home video game market, with the first console release being a port of '1942' in December 1985.

Overcoming Financial Challenges and Mergers in 1989

By 1989, Capcom faced near bankruptcy, but the unexpected success of a strip Mahjong game, 'Mahjong Gakuen,' provided a crucial financial lifeline. In the same year, Capcom Co., Ltd. formally merged with Sanbi Co., Ltd., marking a significant milestone in its corporate history and demonstrating its resilience.

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Capcom's journey is marked by significant achievements and periods of adaptation, establishing its place in the gaming industry. The company's history is punctuated by groundbreaking innovations and significant challenges that have shaped its trajectory. The company achieved major milestones with the launch of enduring franchises, starting with the 'Street Fighter' and 'Mega Man' series in 1987. The release of 'Street Fighter II' in 1991 proved to be a watershed moment, becoming Capcom's highest-grossing title and pioneering the fighting game genre with its innovative combo systems and special moves. In 1996, Capcom redefined the survival horror genre with the debut of 'Resident Evil,' which quickly became its most commercially successful game series, selling over 174 million units as of June 30, 2025. The 'Monster Hunter' series, which began in 2004, has also become a flagship franchise, with cumulative sales surpassing 122 million units as of June 30, 2025. These titles, alongside 'Devil May Cry' (over 36 million units sold as of December 31, 2024) and 'Ace Attorney' (13 million units sold as of December 31, 2024), showcase Capcom's consistent ability to deliver critically acclaimed and commercially successful intellectual properties.

Capcom has consistently innovated by creating and refining game genres, from the fighting mechanics of 'Street Fighter II' to the survival horror elements of 'Resident Evil'. The company's ability to translate beloved 2D franchises into successful 3D experiences demonstrates a forward-thinking approach to technological advancements in game development.

Fighting Game Genre Innovation

'Street Fighter II' introduced complex combo systems and special moves, setting a new standard for the fighting game genre.

Survival Horror Redefined

'Resident Evil' established the survival horror genre with its atmospheric tension, resource management, and puzzle-solving gameplay.

Transition to 3D Environments

Capcom successfully adapted its established 2D franchises into compelling 3D experiences for modern gaming platforms.

Franchise Longevity and Expansion

The company has demonstrated a sustained ability to develop and expand its core intellectual properties over decades, maintaining their relevance and commercial success.

Digital Sales Strategy

Capcom has strengthened its digital sales approach, leveraging its extensive catalog to drive revenue and reach a wider audience.

Human Capital Investment

The company continues to invest in its workforce and enhance its development structure to foster sustainable growth and quality game creation.

Capcom has navigated periods of significant financial strain, including a near-bankruptcy situation in the late 1980s, and has experienced recent fluctuations in financial performance. A notable challenge occurred in the nine months ending December 31, 2024, with a decline in net sales by 16.3% and net income by 33%, attributed to fewer major releases compared to the prior year.

Near Bankruptcy and Recovery

In the late 1980s, the company faced a critical financial situation, from which it recovered with the success of titles like 'Mahjong Gakuen'.

Market Transition to 3D

The early 2000s presented a challenge in transitioning 2D arcade and console series to 3D environments, a strategic hurdle that ultimately led to success for key franchises.

Recent Financial Performance Fluctuations

The period ending December 31, 2024, saw a dip in sales and income due to a less robust release schedule compared to the previous year, highlighting reliance on new major titles.

Adapting to Market Dynamics

Capcom continually adapts to evolving market demands and player expectations, a constant challenge in the fast-paced video game industry.

Maintaining Franchise Relevance

Ensuring that long-standing franchises remain appealing to new generations of gamers while satisfying existing fans requires ongoing innovation and strategic planning.

Global Competition

Operating in a highly competitive global market necessitates continuous investment in talent and technology to maintain a leading position.

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Capcom's journey began with its predecessor, I.R.M. Corporation, founded on May 30, 1979, by Kenzo Tsujimoto. The company officially became Capcom Co., Ltd. on June 11, 1983, initially focusing on software sales. Early milestones include the release of 'Little League' in July 1983 and 'Vulgus,' their first arcade video game, in May 1984. International expansion started with CAPCOM U.S.A., INC. in August 1985. The company's history is marked by the launch of iconic series like 'Street Fighter' and 'Mega Man' in 1987, and the groundbreaking 'Street Fighter II' in 1991, which became a massive global success. The survival horror genre was pioneered with the debut of 'Resident Evil' in 1996, followed by the creation of the 'Monster Hunter' series in 2004.

Financial Projections and Growth Strategy

Capcom anticipates nine consecutive years of record-high profits and eleven consecutive years of operating income growth exceeding 10% for the financial year ending March 2026. The company is targeting net sales of 190,000 million yen and an operating income of 73,000 million yen for this period.

Digital Contents Expansion and Innovation

The strategy focuses on expanding sales within the core Digital Contents business through new releases and strengthening catalog sales, which represented 90% of its 51.87 million unit sales in fiscal year 2024-2025. Future titles will incorporate virtual reality and artificial intelligence.

Upcoming Titles and Technological Integration

Looking ahead, titles like 'Onimusha: Way of the Sword' and 'Pragmata' are slated for 2026, with 'Resident Evil 9' rumored for a 2025 release. This demonstrates a commitment to technological advancement and maintaining leadership in the interactive entertainment market. Learn more about the Growth Strategy of Capcom.

Commitment to Human Capital and Brand Value

The company's ongoing investments in human capital and robust brand management further underscore its dedication to sustainable growth. This approach aims to enhance corporate value and deliver gaming fun worldwide.

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