Despite a decline in sales in the second and third financial quarters, Square Enix is set not only to turn a profit this financial year but to enjoy a 12.4% increase over the previous one. The HD games sector of its Digital Entertainment division, overseeing the release of such heavy hitters as Final Fantasy 7 Remake and Marvel’s Avengers, saw healthy sales, while its MMO figures remained profitable despite no new expansions for its flagship titles.
In a press release detailing their financial position in the period from March to December 2020, the company announced an impressive 33.7% increase in net sales compared to the same period from the previous year. While profitability for the period was down 4.3%, Square Enix forecasts a rally by the end of this financial year in March, leaving it with a 12.4% increase in profit compared to financial year 2019/20, at 24 billion yen.
The slides from the company’s financial results briefing session make for interesting reading: the HD games portion of its Digital Entertainment division details a peak in Q1 in both net sales and operating income, coinciding with the release of the much-anticipated Final Fantasy 7 Remake as well as the first few months of the Covid-19 pandemic. The sales figures in this first quarter constitute an impressive spike, clocking in at 34.1 billion yen, more than double that of the best period of the previous financial year.
The second and third quarters saw a dip in sales, however, and a sharp decline in operating income, leaving the department running at a loss for several months. The lackluster release of Marvel’s Avengers may have contributed to this, though it should be noted that net sales for these quarters still comfortably outstripped even the best statistics of the previous year. In the same period, both sales and operating income for MMO titles saw a slight fall but the department remained profitable even with no major releases or expansions thanks to the steady stream of income from players, and should see a boost in the final quarter due to updates to Final Fantasy 14.
Elsewhere, the company’s browser and mobile games division saw a steady increase over the period, combining sales from new releases such as Octopath Traveller: Tairiku no Hasha with continued, solid performance from older titles including Dragon Quest Walk. Things looked less rosy in the Amusement section, however, which saw an alarming drop in Q1 as the pandemic tore into Square’s usually respectable arcade business, though Q3 saw the department clawing its way back to profitability.
All in all, despite a turbulent year in more ways than one, Square Enix is looking pretty healthy as it prepares for the next financial year. With updates and a next-gen release coming to Marvel’s Avengers, a sequel to Final Fantasy 7 Remake in the works, and no doubt myriad other irons in the fire, the company is likely anticipating another exciting year ahead.
Source: Square Enix
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