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[Draugoth]

Today Square Enix announced its financial results for the first nine months of the fiscal year, related to the period between April and December 2022.

Sales were 255,616 million yen, down 6.6% year-on-year. Operating income was 41,315 million yen, down 17.6％ year-on-year.

In the table below, you'll notice that the profit attributable to owners of parent is actually positive year-on-year. That's due to the 9,500 million gained from the sale of Crystal Dynamics, Eidos Montreal and more to Embracer.

Looking at the Digital Entertainment unit, which includes video games, net sales were 184,380 million, down 12.9％ year-on-year, while operating income was ¥38,735 million, down 21.6％ year-on-year.

Sales of HD games (non-GAAS games for consoles) failed to reach the level of the previous year despite the launch of multiple new games. During the previous fiscal year, Square Enix launched titles like NieR Replicant ver. 1.22474487139..., Marvel’s Guardians of the Galaxy, and Outriders, and this year's games simply weren't able to generate the same results.

A drop in the MMO segment was to be expected. As well as Final Fantasy XIV may be doing, it's hard to compete against the quarter (Q3 in the previous fiscal year) in which Square Enix released the highly acclaimed and extremely profitable Endwalker expansion.

Smartphone and browser games also suffered from the weak performance of existing titles, contributing significantly to the decline in sales.

That being said, we hear that Square Enix has "multiple new titles planned, including titles featuring new IP" for the HD Games segment. While no expansions are planned for the MMO segment in the short term, the company "will focus on retaining users through a variety of operational initiatives." As for browser and smartphone games, the company has "additional titles slated for launch in Q4 and beyond."

Below you can check out the ratio between digital and packaged sales, which is massively in favor of the former. That's unsurprising since all sales for subscriptions and smartphone games are digital.

Last, but not least, we see a breakdown of unit sales by region groups, with North America and Europe taking the lion's share.

 

[feynoob]

I think there is a platform called Xbox. But it seems square doesn't like them.

 

[doomdizz]

i cannot believe they sold tomb raider for 300 mil just for it be sold again for 600. At least they have more NFT funds lmao

 

[FeastYoEyes]

A lot of their games that aren't Final Fantasy have been doo doo for years. I think that might have an impact. Plus they just sold off over half their revenue streams.

 

[winjer]

That big bet on NFTs sure was a success. And selling major studios and IP's for cheap, to fund more NFTs.

 

[Topher]

 

[Dr. Wilkinson]

So they had an off year, so what. FFXVI is coming in 4 months, and FF VII R Part 2 is less than a year away. They didn't have any major releases last year.

I think basically all of their games last year sort of flew in under the radar and underperformed. Harvestella didn't make much of a splash at all, DG Treasures, FF Origins wasn't a real FF game, etc. Everything was like B-tier AA.

This quarter won't be much better for them, outside of Octopath 2. Forspoken is for sure going to come in below expectations.

 

[Magic Carpet]

Non GAAS games are called HD games? What does HD stand for?

 

[TintoConCasera]

Maybe they should stop releasing shitty games and focus on Dragon Quest 3 HD.

 

[Dr. Wilkinson]

Non GAAS games are called HD games? What does HD stand for?

.....

high definition.

 

[Jim Ryan other Clone]

Make games that are interesting and people will buy it. Boring stories that are pandering to any demographic does not help. My brother was telling more interesting stories to my parents to avoid punishment.

 

[Dick Jones]

If SE had proper management they'd be dangerous. Great IP and just the wrong choices

 

[fart town usa]

Too many buckles and zippers in the budget.

Get rid of that shit.

 

[jm89]

I think there is a platform called Xbox. But it seems square doesn't like them.

Xbox isn't saving square enix from releasing a lot of average games.

 

[feynoob]

Xbox isn't saving square enix from releasing a lot of average games.

They will help gain some money.
It's better to have some than none.

 

[Swift_Star]

Just go back to make good FF and KH games. Also make better AA games. Forget about the trash NFT agenda and make better mobile games.

 

[Tomi]

Start making games, not stupid new ips!!!

 

[Juza]

 

[squallheart]

I remember a time where I couldn't wait for a square release and now the last one I played was ff7 remake and that was meh for me. Before that it was tomb raider series.

 

[SmokedMeat]

Oh good, more 6/10 games coming.

 

[Dynasty8]

Honestly, they have become one of the most incompetent developers and publishers in the world. They have some good in them still such as Yoshi P, Creative Business Unit 3, IPs like FF and Nier....but the company as a whole has fumbled the ball so hard numerous times in the last 15 years.

 

[Fake]

Lets wait for Forspoken numbers to make the verdict about this.

 

[lh032]

I think there is a platform called Xbox. But it seems square doesn't like them.

1. SE physical/digital game sales is not going to be high on xbox.
2. Microsoft very unlikely to spend alot of money to bring SE games into gamepass.

 

[feynoob]

Lets wait for Forspoken numbers to make the verdict about this.

For spoken is the new balan wonderworld.

 

[feynoob]

1. SE physical/digital game sales is not going to be high on xbox.
2. Microsoft very unlikely to spend alot of money to bring SE into gamepass.

Ask Sega about that whether MS is willing to give them a lot of money or not.

Also Xbox money would have given them extra revenue, compared to not putting games there which they won't see any money.

 

[kvltus lvlzvs]

i cannot believe they sold tomb raider for 300 mil just for it be sold again for 600. At least they have more NFT funds lmao

they are truly living the crypto trading lifestyle

 

[jm89]

They will help gain some money.
It's better to have some than none.

I'm sure they will they will get some revenue. But that doesn't address the main problem plaguing SE right now.

 

[Astray]

i cannot believe they sold tomb raider for 300 mil just for it be sold again for 600. At least they have more NFT funds lmao

Not even sold, LICENSED for 600m.

Embracer will be able to relicense or sell the Tomb Raider IP after the Amazon deal expires.

Edit: there are further details to this obviously, but Square Enix just didn't do a good job at selling the studios imo.

 

[tmlDan]

They will help gain some money.
It's better to have some than none.

naw, production costs for an xbox version would cost more than the amount of people that buy their games on xbox.

 

[HotSauceEnema]

just dont make games like Forspoken and we might be interested

 

[EverydayBeast]

Square Enix needs that fight in them I would assume they make sure final fantasy 7 remake part 2 is good to go.

 

[Fake]

just dont make games like Forspoken and we might be interested

 

[feynoob]

I'm sure they will they will get some revenue. But that doesn't address the main problem plaguing SE right now.

They need to get rid of that guy that is managing them.
No company should chase nft like they do.

 

[ToTTenTranz]

They need to sell more IP to fund more NFT projects.


With that said, I'm making a public offer of 1000€ for Final Fantasy.
Take it or leave it.

 

[feynoob]

They need to sell more IP to fund more NFT projects.


With that said, I'm making a public offer of 1000€ for Final Fantasy.
Take it or leave it.

I am increasing that bid to 100 nfts.

 

[ssringo]

As a primarily PC gamer I'm rather sick of their bullshit and as such don't even give their games a chance anymore.

Meanwhile I can't throw enough money at Capcom.

 

[ToTTenTranz]

I am increasing that bid to 100 nfts.

Aw fuck..

I'm out, then.

 

[th4tguy]

i cannot believe they sold tomb raider for 300 mil just for it be sold again for 600. At least they have more NFT funds lmao

That wasn’t 600 million us dolors. It was 600 million Crona which converts to about 57 million usd.

 

[DonkeyPunchJr]

Uh oh. Are there any remaining forgotten SE franchises? A few more bland 6.5/10 reboots, remakes, and revivals ought to set the sales charts on fire.

 

[Murdok]

They need to sell more IP to fund more NFT projects.


With that said, I'm making a public offer of 1000€ for Final Fantasy.
Take it or leave it.

In addition to transforming multiplatform games into console exclusives.

 

[Dis]

I miss Squaresoft

 

[Nautilus]

I think there is a platform called Xbox. But it seems square doesn't like them.

i say this, without irony, that it wouldn't have made that much difference.

 

[Pejo]

You know, with modern S-E, I'm really confused. On one hand, I appreciate that they're the only major publisher making A/AA games with their IPs. On the other hand, these games are either terribly designed or the art style (graphics not withstanding) have just been this terrible muddy eastern meets western style.

Yes these are 3 different SE games released in 2022.

Like anybody with eyes can see that these character models are just fucking ugly, no matter what your preference for character design is. There's nobody that looked at those Star Ocean characters and said "Fuck yea, Raymond looks fucking AWESOME". He looks like somebody designed in a 3D modeling class in high school.

Granted, SO6 wasn't a major release, but when you just don't give a shit enough to make an attractive product, how can you expect to make decent money off of it? Even if the gameplay was tight as fuck (which I heard SO6 had pretty good gameplay), most people are going to look at media and reviews, see those ugly uncanny valley protags, and just assume the game is shit.

Like Babylon's fall - All of the signs were there from the betas that the game was not good. Not visually, not gameplay, not gameplay systems and progression. Yet for some reason, they chose to not only release it, but then act shocked when the market said "fuck this, this game sucks". Then they send out a big survey saying "how can we make the game look better?", and announced the cancellation months later before making any sort of honest attempt to fix it.

This is all mismanagement at S-E's project manager levels. None of these games should have been released looking like this. There are plenty of ways to stylize graphics and clean up gameplay to not have to break the budget but still have the games look like they aren't immediately garbage bin titles.

In my opinion, this is why SE is having a rough go of it, even though I like the fact that they're giving their IPs a try, especially in that basically forgotten A/AA space. Look at the success of Hi-Fi Rush. That's another game in a similar niche and it's doing really well. That's the type of thing that SE needs to look at and ask, "what did we do wrong?" Also they need to stop trying not to be a JP games company. Also fuck NFTs.

 

[Dick Jones]

They need to sell more IP to fund more NFT projects.


With that said, I'm making a public offer of 1000€ for Final Fantasy.
Take it or leave it.

I think you could get agreement from them if you requested 1,000 and Final Fantasy IP. You are giving their leadership too much credit.

 

[Amish Prince]

i cannot believe they sold tomb raider for 300 mil just for it be sold again for 600. At least they have more NFT funds lmao

That was a false report. It was "leased to Amazon" for 600m krona. Which is about 57m usd.

 

[SNG32]

They need to tell Sony to fuck off with their timed exclusive bullshit and make their heavy hitters available day and date on Xbox and PC. Or atleast PC. It was almost a wrap
for Capcom years ago and they turned that shit around real quick once they starting being serious with pc ports.

 

[Kimahri]

I think there is a platform called Xbox. But it seems square doesn't like them.

They shit the bed there. They were doing really well in cultivating that audience for years by launching a lot of games, many of them on game pass.

But they forgot that cultivating an audience takes time, and since SE didn't immediately sre the return on the investment that they wanted, they seemingly juat said nah, fuck it. And no xbox is an after thought.

You can't expect a loyal fanbase on xbox if you treat them like shit.

 

[DenchDeckard]

Hopefully, Sony is funding the losses. As I believe FF XVI is even being held off PC at launch? That's gonna kill a good number of sales, potentially millions. Yes Xbox isnt a HUGE number of sales, but Xbox and PC together would come to quite a lot.

Serves them right for signing the exclusivity deals TBH.

 

[Fbh]

Square is just annoyingly inconsistent.
They can simultaneously make one of my favorite games of last year (Triangle Strategy) and one of my most anticipated games of this year (FFXVI) and also release a bunch of forgettable b-tier crap.

Games like Dioefiled and Valkyrie Elysium should have been way better than they ended up being. It doesn't matter if they are smaller budget titles, everything with the Square name should have some degree of consistency regarding things like gameplay and story. Look at Falcom who exclusively make low budget titles and yet manage to make them consistently good, or don't get me started on how ONE dude almost single handedly made a more compelling retro RPG (Chained Echoes) than anything Tokyo RPG Factory has been able to do despite being specifically created for that purpose.

 

[SNG32]

Hopefully, Sony is funding the losses. As I believe FF XVI is even being held off PC at launch? That's gonna kill a good number of sales, potentially millions. Yes Xbox isnt a HUGE number of sales, but Xbox and PC together would come to quite a lot.

Serves them right for signing the exclusivity deals TBH.

It won’t release on PC until 6 months after and they will probably release it on epic first for a bit before it sees a steam release date. Hopefully they smarten the fuck up and release on steam once they announce it releasing on PC.