Japanese publisher Capcom announced its second quarter fiscal results today, revealing a 16.8 percent increase in net income to 1.873 billion yen. Net sales were up just one percent to 16.486 billion yen, while the company's operating income jumped 47.9 percent to 3.637 billion yen.

Capcom's second quarter was primarily driven by the release of Monster Hunter Freedom 2G (PSP), which sold around 2.5 million units. The publisher said the title "took the market by storm" and the game has "become a social phenomenon in Japan." Monster Hunter also became the first software for PSP to reach the 2 million sales mark, which Capcom noted "played a major role in the diffusion of the portable game console."

Capcom said that Lost Planet: Colonies (PC, Xbox 360) "showed solid performance" and "other software, mainly small-scale titles and those developed under the partnership with other companies, grew satisfactorily in general."

The news wasn't as positive for the declining arcade business, which experienced an operating loss of 231 million yen. Capcom said "we struggled in this area due to a lack of strong sales-inducing machines, intensified interregional competition, and a decrease in both the number of customer visits and average customer spending." The company expects the "severe business environment for the arcade operation to continue, and the recovery of this market will take some time."

For the fiscal year ending on March 31, 2009, Capcom expects net sales to rise 14.7 percent to 95.3 billion yen and net income to increase 10.1 percent to 8.6 billion yen.