Square Enix’s financials were released earlier today. While they showed a keen percentage of physical consumers compared to digital, they also showed a huge loss of $33 million.
The gigantic financial hole can be pinned down to the company’s opening of Luminous Productions. The new AAA studio led by Final Fantasy XV director Hajime Tabata is currently just getting off the ground. They claim that “Imagination has no limits. Boundaries can be pushed. [We have] an obsessive drive to turn ideas into reality.”
There is no clear instance of what at Luminous is causing this sharp financial decrease, but as the company has only just started forming without any output (games or otherwise) they are currently a financial sinkhole.
Square Enix’s overall sectors aren’t doing so well either. Profits are down from last year by half – Q2 2018 has only brought $76.4 million of profit. Square’s operating income has taken an even worse cut; down 61% from last year’s Q2 period, the company’s operating income lays at just $88.5 million. Traditional income is down by 43.6%.
Square Enix’s releases over the six month period are not as high profile as prior years, which could speak for their large losses. The Switch exclusive Octopath Traveller and the multi-platform Shadow of the Tomb Raider were the company’s highest-profile releases, but Square has not yet commented on their view of the titles’ sales performances.
It would appear that Squenix is also seeing a decline in every aspect of their business. Mobile and PC browser titles are performing poorly compared to previous years along with merchandising and licensing income.
While the six month period does seem rather grim at first glance, Square Enix is forecasting a net sales increase for the full financial year. The company’s operating and ordinary income are still expected to be decreased by 18.7% compared to last year, but net sales are predicted to be 7.8% better than 2017.