Square Enix president resigning amid extraordinary loss

Square Enix president Yoichi Wada is to resign as the Japanese firm makes sweeping changes to its business structure that will hit its bottom line hard in the current business year.

Wada joined Square in April 2000, three years prior to its merger with Enix, and quickly rose to the top of the company, becoming CEO in December 2001. Following the merger he was appointed Square Enix president.

The company said today that it expects to confirm current representative director Yosuke Matsuda as its new president in June 2013 following a general meeting of shareholders. A Square Enix statement read: "In view of the rapidly changing environment of the game businesses, the company has decided to implement major reforms and restructuring in its development policy, organizational structure, some business models, and others.”

The Final Fantasy maker today dramatically reduced its earnings outlook for the current fiscal year ending March 31, 2013, citing "slow sales of major console game titles in North American and European markets", the "sluggish performance” of its arcade machine business, and an "extraordinary loss" of around ten billion yen (£70m / $106m) expected to be suffered as a result of its newly announced restructuring efforts.

For the business year, Square Enix now expects to post a net loss of 13 billion yen (£91m / $138m), compared to October 2012’s guidance of a 3.5 billion yen (£24m / $37m) profit, and a six billion yen (£42m / $64m) profit reported the previous business year. Additionally, it cut its annual revenue forecast from 150 billion yen to 145 billion yen (£1b / $1.5b).

Last week, it was also confirmed that Electronic Arts CEO John Riccitiello will leave his position on March 30 after the FIFA publisher’s financial performance failed to meet yearly expectations.