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Square Enix “struggling” in tough console market climate

Square Enix said today that underperforming console games were largely to blame for a disappointing nine month period at the Japanese company.

The Sleeping Dogs and Hitman: Absolution publisher posted a loss of 5.7 billion yen (£39m / $61m) for the first three financial quarters ended December 31, 2012, compared to a profit of 5 billion yen (£34m / $54m) a year earlier.

That was despite an increase in sales of 7.4 per cent year-over-year to 102.8 billion yen (£702m / $1.1b).

Square said its losses were “primarily due to the increasingly difficult condition of the world-wide console game market, under which the group is struggling to achieve a fair expected return on its investment”. It also cited the "sluggish performance" of arcade game machines as another contributing factor to "unfavorable sales and earnings".

Elsewhere in its financial report, Square said other gaming platforms such as PCs, smartphones and social networking services are "generating an acceptable profit", the operation of Wii MMO Dragon Quest X is “showing steady progress" ahead of its upcoming rollout on Wii U, and the firm’s amusement facilities business is described as "stable".

Looking ahead, Square forecast a net profit of 3.5 billion yen (£24m / $38m) for the 12 months ending March 31, 2013. If the guidance is accurate, the figure will represent a decline of 42.2 per cent year-over-year.

It said: "The company views the expansion of content and services that conform to emerging customer needs led by the fundamental change in the business environments, and the launch of full-scale commercial services for major MMO titles will establish its profit base, and is focusing all efforts on an earnings recovery from now on."

Topics

financial

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13 comments

  • angelusdlion - February 6, 2013 9:17 a.m.

    Dear Squeenex. Having money problems? HD FFVII remake. Money problems gone forever.
  • Sinosaur - February 6, 2013 11:04 p.m.

    That's not entirely guaranteed, if they were to actually remake it it would take at least as much work as FFXIII did, if not more because the game isn't mostly straight lines. If SE is going to remake a game like that, they'll either go portable, in which case it will be able to use lighter graphics, or be console and might as well be a full release. Unless you just mean HD upscale, with no actual change to the graphics, in which case... FFVII is already on PSN and hasn't made them all the money ever.
  • Talvari - February 5, 2013 4:43 p.m.

    Hope things go well for them. Enjoying the XIII series and actually quite looking forward to what Lightning Returns has to offer. Guess you can't please old fans stuck wanting more of the same ;.;
  • joabbuac - February 5, 2013 3:19 p.m.

    Spend less on pretty graphics and more on gameplay. You could tell Sleeping dogs was really there game....
  • angelusdlion - February 6, 2013 9:18 a.m.

    Their game I think you mean? And Squeenix just distributed that one, you know.
  • joabbuac - February 9, 2013 5:31 a.m.

    angelusdlion I know...that was my point, activision dropped the ball with this one - A game coming from square that had gameplay over graphics is a rare thing, the only one being a game they picked up when it was all but made. And fuck off grammar
  • BladedFalcon - February 5, 2013 1:59 p.m.

    Well... let's forget about what Eidos has done, and focus on what Squeenix itself has made in the last 3 years, shall we? -Final fantasy XIII, one of the most divisive (and arguably the most) FFs to ever come out, loved by some, and hated by others, so not exactly their most beloved entry in the franchise. -A bunch of Kingdom hearts Spin-offs and remixes of varying quality, and even when good, they aren't exactly what the fans of taht franchise are clamoring for, which is KH3, which is STILL unanounced so far. -Final fantasy XIV, an unmitigated disaster in pretty much every level, so much so that the president of the company has had to apologize pretty much every time the subject comes out. - Final Fantasy XIII-2. Instead of focusing on releasing the actual FF game everyone wants, (hint, it has a "versus" in it's name.) they make a sequel to that highly divisive game that a lot of people hated. Changed a lot, and yet it STILL managed to be just as divisive, if not more than the first FFXIII. - Instead of cutting their losses and moving on with something new and (hopefully) better, they spend a crapload of resources to "Fix" and revamp FFXIV, which, regardless of it's final quality, it's safe to say that a LOT of people who were burned or disinterested the first time around, won't be giving it a chance anymore. - Hey, so NOW they should be finally putting attention to FF Versus XIII, right???? NOPE. Instead, we're getting a SECOND sequel to FFXIII, yaaaaay? So yeah... and all this in the last THREE years, notice something missing? New ideas and games... Or at the very least, proper follow-ups to their most beloved franchises. The last notable original IP that Squeenix released was The World Ends With you... and that was effing 5 years ago. And AGAIN, in case I didn't make myself clear, i am talking about internally developed square games, not Eidos properties. ...I'm sorry Squeenix, but I am pretty sure that more than the console market climate, the reason why it's going shitty for you is BECAUSE YOU KEEP FUCKING UP EVERY SINGLE TIME.
  • Dante1924 - February 5, 2013 2:01 p.m.

    Bravo. Only possible thing I could add to "improve" that would be All the Bravest
  • taokaka - February 5, 2013 10:19 p.m.

    Don't forget porting every pre 7 final fantasy to every device ever, releasing outrageously expensive ios games, not localizing their two most critically acclaimed original rpgs in years and just this year releasing the worst final fantasy to date.
  • Travia220 - February 6, 2013 4:04 a.m.

    It's ridiculous to bring up their mobile releases considering that division is profitable. Maybe we should look at the fact Console game sales are down about 23% last year and the market is oversaturated currently.
  • taokaka - February 6, 2013 7:52 a.m.

    I just wanted to bring up more ways in which square enix are horrible publishers but I disagree with your last statement. Firstly, the mobile market is even more over saturated than the console market. Secondly, as BladedFalcon pointed out it's only square's fault that Square's console division is falling behind expectations and this is pretty much just PR codswallop to hide this fact. It's like publishers blaming piracy if their game fails on PC
  • Redeater - February 5, 2013 12:57 p.m.

    Don't worry. I'm sure that sequel to FF13 they are making featuring the most boring FF character ever will turn things around for them. Or maybe the IOS FF they just released will help them. Plus I'm sure they are riddled with profits from sales of the second worst Hitman game that just came out.
  • Lucario995 - February 5, 2013 12:39 p.m.

    I swear, if Square Enix dies, so will my gaming life.

Showing 1-13 of 13 comments

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