Square Enix to record extraordinary loss of 22.1 billion yen in “content abandonment losses” following revised development approach

Shares of Square Enix Holdings Co. tumbled 16% in their biggest decline in 13 years after its president said sales of recent big-budget games disappointed and that it would take years for a recent reorganization to bear fruit.

Square Enix seems to have been disappointed by the sales of Final Fantasy 7 Rebirth. According to Bloomberg, company president Takashi Kiryu revealed to analysts after its earnings call that Final Fantasy 7 Rebirth was unable to reach the launch momentum required to hit internal targets.

In a recent earnings call, Square Enix president Takashi Kiryu has revealed that, similar to Final Fantasy 7 Rebirth (backlink to other story), Final Fantasy 16 has also failed to hit sales targets. According to Bloomberg, Kiryu’s statement indicated that sales of Final Fantasy 16 had slowed down after the sales during the game’s launch period.

Square Enix has announced a brand-new business plan that will see the Japanese publisher shift to a multiplatform strategy.

Three of Square Enix‘s most high profile recent releases sold worse than expected, the company’s president has reportedly said.

Square Enix‘s share price has dropped by nearly 16% following its FY2024 financial results on Monday.

Square Enix has admitted Final Fantasy 7 Rebirth, Final Fantasy 16, and Foamstars failed to meet its expectations.

Square Enix has announced a major shakeup dubbed ‘Square Enix Reboots and Awakens’ that will see them embrace full multi-platform game development, after PlayStation 5 exclusives Final Fantasy 16, Final Fantasy 7 Rebirth and Foamstars all failed to meet internal expectations. Additionally, they are making layoffs affecting US and European staff, including the Square Enix Collective indie label – per VGC.

In light of its recently-revealed new mid-term business plans, Square Enix has now confirmed that it has cancelled games that didn’t align with its new strategy. In its latest earnings report (via VGC), the company has confirmed that a number of unannounced titles were cancelled, and that its profits being 70 percent lower than last year were a result of these cancellations.

Square Enix is reportedly preparing to lay off an unconfirmed number of workers as part of restructuring efforts.

Square Enix recently announced a new medium-term business plan to focus on multi-platform releases and games delivering on the premise of “fun.” However, it also outlined plans to “rebuild overseas business divisions from the ground up,” which meant “optimizing costs at its European and American offices via structural reforms.” Unfortunately, it seems layoffs are part of the equation.

After rebooting Final Fantasy 7 as the trilogy of Remake, Rebirth and Really, You Went With That? (TBC), Square Enix are now planning to reboot themselves. Among the publishers’ revamped approach to making money - following a recent drop in profits, per their latest financials - is a more “aggressive” approach to bringing their games to more platforms than specific consoles (in other words, PlayStation) as exclusives, with a particular focus on “win[ning] over PC users”.