Company history

Capcom began in May 1979 as a reseller, not a maker. Kenzo Tsujimoto — an Osaka entrepreneur who had earlier run a mobile cotton-candy-machine business and a food wholesaler — founded IRM Co., Ltd. in Matsubara, Osaka, with capital of $43,478 (¥10m) to develop and sell electronic game equipment, and at first simply bought other firms’ arcade machines and sold them on. Renamed Sanbi in 1981, the business set up a separate sales company, the original Capcom, in 1983. The name — from CAPsule COMputer — cast a game as a capsule packed with play, sheathed in a hard shell that guarded its contents from piracy and cheap imitation. Three changes of name and head office in four years traced a company feeling its way from selling hardware toward developing its own.

The turn to in-house creation came fast. In 1983 Capcom built its first original arcade machine, the medal game Little League; in 1984 it began developing coin-op video games; in 1985 it set up CAPCOM U.S.A. to sell directly into North America and, that December, entered home software with 1942 for Nintendo’s Famicom. Within a few years the centre of gravity shifted from selling arcade cabinets outright to shipping home titles by the hundreds of thousands and millions per game, as arcade hits such as Ghosts ’n Goblins and Commando were ported across.

In 1989 Sanbi absorbed the original Capcom to become Capcom Co., Ltd., and in October 1990 registered its shares over-the-counter with the securities dealers’ association — a first channel to the market. Then, in 1991, the arcade Street Fighter II became a worldwide phenomenon: it fixed the competitive fighting game as a genre, and through home ports the series passed twenty million units, making Capcom’s name a global software brand. All of it was built under Tsujimoto’s mi-no-take discipline — funded from the company’s own cash, without borrowing or acquisitions, with overseas arms started as local subsidiaries rather than bought.

The 1990s and 2000s built the global publisher. A new Osaka head-office building and a domestic distribution plant opened in 1994; U.S. sales and development arms followed in 1995, a scenario studio in 1997, then a march up the market — the Osaka Second Section in 1993, the First Section in 1999, and the Tokyo Stock Exchange First Section in 2000 — with European bases in Britain (2002) and Germany (2003) completing a three-pole U.S.–Asia–Europe network by 2003. On that network Capcom stacked owned franchises: Resident Evil (1996), then Onimusha, Devil May Cry and Monster Hunter. But in 1998 it posted its first net loss since going public, winding up a Mexican subsidiary and writing down a U.S. holding company — losses it chose to take all at once, in keeping with mi-no-take.

As console generations turned, a single title could take years and swell from hundreds of millions to over a billion yen to make, while retail turned on opening-week numbers — long development against short selling. Capcom’s answer was its first restructuring of 2003–04: a “60-month map” that laid five years of releases on one sheet, a two-stage greenlight that could kill a project before its budget ballooned, and a shared in-house engine (later MT Framework). The gains showed from the year to March 2007; that June, founder Kenzo Tsujimoto handed the presidency to his son Haruhiro Tsujimoto while staying on as chairman and CEO.

Then the smartphone era arrived, and Capcom over-invested in it. Record sales of $1.0B (¥82bn) in the year to March 2011 gave way to a roughly 55% drop in net profit the next year as mobile bets squeezed margins. The second restructuring of 2012 pulled back from amusement equipment and mobile and re-centred the company on console games. Sales fell — to about ¥64.3bn in the year to March 2014 — but with the low-margin businesses stripped out, the operating margin of the core rose to 16.5%, and the underlying profitability surfaced.

Out of the second restructuring came a new in-house engine. The RE Engine, successor to MT Framework, was built for photoreal graphics, VR and simultaneous optimisation across platforms. Its first commercial title, Resident Evil 7 (January 2017), sold 3.5 million units by the year’s end; Monster Hunter: World (January 2018), the series’ first simultaneous worldwide release, then pushed the franchise to a scale it had never reached.

Monster Hunter: World also turned a corner on distribution. Capcom’s digital sales ratio, stuck in the 30s (through the year to March 2016), passed 50% by 2019 and reached the 70s by 2020. Digital sales sit outside the retailer’s inventory risk and discount pressure, and a catalogue title keeps re-selling for years through staged price cuts — from roughly $60 at launch down to $10 and $5 over about five years — so repeat sales of older games now fund the development of new ones.

Under Haruhiro Tsujimoto’s pledge of “10% profit growth every year,” operating profit climbed from $100.2M (¥11bn) in the year to March 2014 to $434.3M (¥66bn) a decade later — a twelfth straight year of growth — while the operating margin rose from 16.5% to 38.8%. Three 1:2 stock splits (2018, 2021, 2024) and an explicit 30% consolidated payout ratio drew in retail investors; market capitalisation topped $15.3B (¥2.29tn) in May 2025 and the price-to-book ratio rose from 1.84 to 6.77, breaking out of the low valuation the game sector had long carried. It is the high point of the founder’s self-financed creed — reached not through borrowing or takeovers but through owned IP, an in-house engine and a digital catalogue.