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Square Enix reports significant annual loss

Square Enix has posted a significant but expected net loss of 13.7 billion yen (£88m / $135m) for the business year ended March 31 2013. Comparing unfavourably to a six billion yen profit recorded the previous fiscal year, the loss was attributed to poorer than expected sales of major console games and the recent implementation of major restructuring plans.

Full-year sales across the business actually jumped 15.7 per cent year-on-year to 148 billion yen (£948m / $1.5b). Square's Digital Entertainment segment, which plays home to its games business, brought in revenues of 89 billion yen (£569m / $876m), up 24.5 per cent year-on-year, but the division’s operating income declined by 99.7 per cent to 44 million yen (£281,000 / $434,000). The company said: “operating income decreased significantly, primarily due to underperformance of major titles for consumer game consoles in North America and Europe”.

For the current financial year ending March 31 2014, Square predicted a return to profitability. The company expects to report net sales of 140-150 billion yen (£896-960m / $1.4-1.5b) and net income of 3.5-6 billion yen (£22-38m / $34-59m). The publisher recently cut jobs in Europe and in the US as part of the restructuring plans announced in March, which will also result in company president Yoichi Wada resigning this June.