Square Enix's profits drop 70% during the fiscal year ending in March 31st 2024

As Square Enix oversees its performance in the recent year, the company that was the forefront of the RPG renaissance in the mid-90s now aims to pursue an "aggressive multiplatform strategy" as their profits take a severe plummet, based on their released earnings report. 

While digital sales were slightly up, netting ¥99.2 billion ($636 million) compared to ¥78.5 billion ($503 million) from 2023, due to the solid sales of Dragon Quest Monsters: The Dark Prince, Final Fantasy 16, Final Fantasy Pixel Remaster, and Final Fantasy VII Rebirth, operating costs, along with expensive development and advertising costs, this led to  "higher content valuation losses versus the previous fiscal year." The projected operating income was expected to reach ¥55 billion ($352,103,675US) and it only hit ¥32 billion ($204,860,320US). 

Despite strong performance, Final Fantasy VII Rebirth is only meeting half the sales of its predecessor 

"Operating income, ordinary income, and profit attributable to owners of the parent for the fiscal year ended March 31, 2024 were below the company’s forecasts primarily due to weaker HD games sales than expected in the Digital Entertainment segment and to the recognition of valuation and abandonment losses associated with its content production account following a close examination of the company’s development pipeline," states Square Enix's financial report.

The New Strategy: Multiplatform expansion and studio layoffs

Square Enix's decision to keep their high-end third party games on the PlayStation 5 has backfired considerably. To further move forward with their internal restructuring, the developer/publisher announced its new plans to make their AAA games multiplatform, so high-end titles will be coming to the Xbox family of consoles, PC, and Nintendo's Switch successor. The PlayStation 5 doesn't have the install base of the PS4 at this point in its lifespan, so high demand titles like Final Fantasy XVI and FFVII: Rebirth are only doing a portion of sales.

Takashi Kiryu, Square Enix's new president who helmed his new position since June 2023, also stated that employee cuts  and studio closures are on the way, as a part of the company's restructuring. According to Video Games Chronicle, the number confirmed for the employees lost across their North American and European studios isn't available as of this writing. 

SOURCES: Square Enix, Video Games Chronicle