Game Freak made the game that started everything. Red and Green came out on the Game Boy in February 1996. Thirty years later, the same studio still makes the new main-series games, from Sun and Moon through Scarlet and Violet to Legends: Z-A.
It is also one of the three companies that founded The Pokémon Company in 1998, and one of the three that own the Pokémon name in Japan. On paper it is small. In the one year its accounts have surfaced, it earned about as much as TPC’s Tokyo company did, and almost none of that came from its shareholding.
The maker
Game Freak’s job is the games. On Scarlet and Violet’s Japanese credits, TPC releases the game, Nintendo sells it and Game Freak makes it (see Video games). Its staff have roughly tripled in a decade, to 242 people.
One visible year
Japanese company law asks every company, Game Freak’s size included, to publish a short balance-sheet notice each year, in the official gazette, a newspaper or online. Which route Game Freak registered could not be read, and it has no online notice page, but no gazette notice turns up for any of the years to March 2018 through March 2025, the years the gazette indexes fully cover. The one notice found ran in 2015, on the day it gave notice of absorbing a sister studio, five weeks before the merger took effect. That one was required: a company absorbing another must put its balance sheet in the gazette with the merger notice, and only the form was Game Freak’s choice. It shows net profit of ¥1.6bn and retained earnings of ¥10.0bn, about level with TPC’s Tokyo company at the time. It was the year of a new game, so it is a peak: about 4.3× the studio’s lifetime average.
Paid for the work, not the stake
Where did that profit come from? Not from TPC’s dividends: TPC has paid out only a sliver of its profit, and at the most generous split its dividends explain at most 0.6% of Game Freak’s retained earnings. And not from simple cost-plus fees: on an assumed cost per employee, the profit was 3.3× what the richest cost-plus fee would leave. That points to income that rises with sales, a royalty or a profit share, or to very generous fixed fees. The research cannot tell which.
Dividends were never the channel
Net profit of TPC’s Tokyo parent each year, with the dividends paid out of it, ¥ billion.
- Net profit, Tokyo parent
- Dividends paid out of it
TPC paid out only a sliver of a decade’s profit. The founders are paid for their work instead.
Built from and .Show the numbers
| Year | Net profit, Tokyo parent, ¥bn | Dividends paid out of it, ¥bn | Source |
|---|---|---|---|
| 2017 | – | ||
| 2018 | |||
| 2019 | – | ||
| 2020 | – | ||
| 2021 | – | ||
| 2022 | – | ||
| 2023 | – | ||
| 2024 | |||
| 2025 | – | ||
| 2026 | – |
Net profit, Tokyo parent. ¥415bn over the ten years. 2026 includes a ¥23.8bn one-off gain.
Dividends paid out of it. Worked out from the change in retained earnings: only 2018 and 2024 show a payout (¥12bn in all, 2.9% of the decade’s profit); the other years show none. Dividends only: what the owners earn from business dealings with TPC is not measured here.
Since the Pocket launch, TPC’s cost of sales has grown several times faster than the founders’ staff. If part of that is paid to the studios, it is not visible anywhere.
Costs grew faster than the studios
TPC’s cost of sales against the combined staff of Creatures and Game Freak, indexed to 2021.
TPC’s cost of sales rose several times over while the founders’ staff less than doubled.
Built from and .What it adds up to
Game Freak made the first Pokémon game and still makes the main series. It is small on paper, but in its one visible year it earned as much as TPC’s Tokyo company, and its stake in TPC explains almost none of that. The founders of Pokémon are paid by working, through contracts the public cannot see, not by owning.