Capcom stock prices and credit rating slide after Monster Hunter World release date announcement
Bearish behavior like this is actually very common in the games industry. Whether it’s the failure of a new piece of hardware with Sony, or an overall negative outlook on the financial prospects of the video games industry, this kind of event isn’t all that uncommon. In this case, Capcom was hit with a substantial blow after Bank of America Merrill Lynch (BoAML) downgraded its rating of the publisher from ‘neutral’ to ‘underperfom’.
The news comes in the Financial Times via Variety. And even though Capcom has confirmed that more than eight million units of the game have shipped, it looks like the blisteringly fast growth from the console launch has tapered off a fair bit as sales have slowed. This announcement sent Capcom stocks tumbling down 12.9% in a single day.
The reasoning behind the decision hinges on the outlook for sales of both the PC and Console versions of Monster Hunter World. And it looks like the trend is downward, despite Monster Hunter World giving Capcom its best year ever in terms of finances. In the report, analysts for BoAML say “although cumulative sales volume is growing steadily, we get the impression the popularity of Monster Hunter is dying down six months after its release”, citing sluggish sales in the last few weeks in particular.
It may look like a short-sighted call by BoAML, but there’s some reasoning behind it. A lot of MHW players that I’ve talked with about the game have cited the lack of a substantive end-game as a major concern for the long-term health of the game. If Capcom released a paid DLC for something like G-rank content from other games, that would certainly help improve sales and long-term engagement. But failing that, it looks like the team opted to pull the trigger on the PC release a little earlier than expected in order to ride that wave of excitement and initial sales. It’s even possible that the company knew the downgrade was coming and acted against it, although that’s speculation on our part.
Hopefully the PC release of MHW can rebound Capcom at least a bit, and I personally hope that the game continues to see support in terms of new and engaging content from Capcom in return. We’ll just have to wait and see.
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