Elden Ring DLC Helps FromSoftware Bounce Back After Major Cyberattack

Elden Ring and its Shadow of the Erdtree DLC are proving to be a powerful force behind the success of parent company Kadokawa's gaming sector. Let's delve into the recent security breach and examine Kadokawa's financial report.

Elden Ring and its DLC Drive Kadokawa's Gaming Sector Sales

Kadokawa's Security Breach Results in $13 Million in Losses

On June 27th, the hacking group Black Suits claimed responsibility for a cyberattack targeting Kadokawa, FromSoftware's parent company. They stated they stole a significant amount of data, including business plans and user information. Kadokawa confirmed on July 3rd that the breach compromised personal data of all Dwango employees, internal documents, and some data from employees at affiliated companies.

According to Gamebiz, this security breach cost Kadokawa approximately 2 billion yen (roughly $13 million), resulting in a 10.1% decrease in net profit compared to the previous year. Despite this setback, Kadokawa reported strong first-quarter financial results for the fiscal year ending June 30, 2024. This is Kadokawa's first financial report since the June 8th cyberattack, which disrupted various company services.

Full restoration of business activities is now underway. In the publishing and IP creation sectors, the recovery of shipping volumes for affected publications is expected to progress gradually throughout August, with a return to normal daily shipments anticipated by mid-August. Several major impacted web services are also resuming normal operations.

The video game sector, however, showed remarkable growth. Sales reached 7,764 million yen—an impressive 80.2% increase year-over-year—with ordinary profit surging by 108.1%. This exceptional performance is largely attributed to the phenomenal success of Elden Ring and its Shadow of the Erdtree DLC, which significantly boosted the gaming division's revenue.