CAPCOM (9697) Commend reassuring management, look for AI to enable building of more efficient development systems

Research evidence excerpt

CAPCOM (9697) Commend reassuring management, look for AI to enable building of more efficient development systems

J P M O R G A N Asia Pacific Equity Research

09 June 2026

CAPCOM (9697) Overweight

9697.T, 9697 JP

Commend reassuring management, look for AI to Price (09 Jun 26):¥2,871

enable building of more efficient development systems ▼Price Target (Dec-26):¥3,900 Prior (Dec-26):¥4,100

Capcom’s share price has fallen 12% since FY2025 results announcement on May

13 and June 8 (vs TOPIX down 2% over the same period). We lower our operating Japan Equity Research

profit forecasts from FY2026 in response to rising depreciation and development Games, Internet, Services

costs per title, but other business conditions remain broadly firm. Repeat sales of AC Junko Yamamura

Resident Evil (Japanese name: Biohazard) titles were strong in 4Q FY2025, and (81-3) 6736-8644

we expect strong sales to continue given the series’ proven longevity. The new title junko.yamamura@jpmorgan.com

Pragmata is also selling well, and according to the company, it may book all Ryo Nakagawa

deferred revenue from Resident Evil Requiem in 1Q FY2026. We thus raise our 1Q (81-3) 6736-8643

operating profit forecast from a 0.8% YoY decline to 35.4% growth. We find the ryo.nakagawa@jpmorgan.com

shares’ recent price movements somewhat surprising. We lower our December JPMorgan Securities Japan Co., Ltd.

2026 price target from ¥4,100 to ¥3,900, but maintain our Overweight rating.

• Recent share price movements somewhat surprising: We raise our Key Changes (FYE Mar) Prev Cur Δ

estimates of items like valuation losses and new title development costs for Adj. EPS - 27E (¥) 147.75 142.96 -3.2%

each fiscal year, and lower our operating profit forecasts from FY2026. We Adj. EPS - 28E (¥) 172.38 165.43 -4.0%