Their revenue went up 18%, but their profit went up 49%.
The main difference between this year and last year is that mobile is much higher than it was, while console is lower.
What do you think that implies about profit margins?
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Square Enix's FY15: $368 million mobile, $369 console/hand/PC, $194 MMO, profit +49%
- Thread starter Nirolak
- Start date
The main difference between this year and last year is that mobile is much higher than it was, while console is lower.
What do you think that implies about profit margins?
kiunchbb
www.dictionary.com
That's why it was my wishful thinking. It could also be FF14 cashing out, if the sales of the game last reporting period covered the initial development cost, the subscription fees and expansion pack in FY15 are highly profitable.
Generally games are expensed on an ongoing basis, so only the development costs that happened within that year would be covered in that fiscal report.
Given the game was largely done by April 2014 (when the fiscal year this report covers started), it'd only be the maintenance and ongoing standard development rate of costs.
thelatestmodel
Junior, please.
Good for them, hope they can find a chunk of change in there to put Valkyrie Profile Lenneth on PSN.
Felessan
Member
There are 2 FF11 games - one is a mobile spinoff and one is a mobile adaption of original game (so called MMM - massive multiplayer mobile), latter one being adapted by Nexon.
They are only mention mobile and MMO games in their report. And looking how fast their mobile grow (along with rapidly improvement profit) - means that it's their primary profit driver.
SE didn't have any significant disk release for their MMOs last year, only subscription fees. They however had development cost for expansion packs (both are coming out in Q1 of this FY) and FF14 development team was very large.
We should be happy that successful Mobile games help them finance AA(A) stuff, really. At least if they maintain the, imo, healthy "diversification"-mentality (more mid-budget stuff, which I would welcome - though I'm not interested in mid-budget online games shown below in the western part).
From last year:
Let's face it: Mobile is here to stay and it's not inherently bad. Not every game has to be a shallow, F2P cash-grab. They just have to be made from ground up for smartphones/tablets in mind. That said, I still would like to have most games on PC and consoles, obviously. But who knows, someday we'll probably just stream from our phones/tablets to our TV and play with Bluetooth controllers. If that's the inevitable future, well, we'll just have to adjust (and we will eventually, who are we kidding).
The market has changed, SE has to act to stay relevant and they luckily seem not to want to transition to Mobile completely. I want there to be a FFXVI, FFXVII (and FFVIIR
), so let's hope it works out for them in the next years! I think we're witnessing some sort of resurgence. I'm optimistic.
From last year:
Let's face it: Mobile is here to stay and it's not inherently bad. Not every game has to be a shallow, F2P cash-grab. They just have to be made from ground up for smartphones/tablets in mind. That said, I still would like to have most games on PC and consoles, obviously. But who knows, someday we'll probably just stream from our phones/tablets to our TV and play with Bluetooth controllers. If that's the inevitable future, well, we'll just have to adjust (and we will eventually, who are we kidding).
The market has changed, SE has to act to stay relevant and they luckily seem not to want to transition to Mobile completely. I want there to be a FFXVI, FFXVII (and FFVIIR
), so let's hope it works out for them in the next years! I think we're witnessing some sort of resurgence. I'm optimistic.djplaeskool
Member
MMM will always be Moblin Maze Mongers in my heart.
Why is mobile doing well a bad thing? They're not reporting any bad results from their non-mobile games, either.
Heck, from these FY reports that we usually get, SE has been adamant in saying how delivering console games is part of its company DNA is an important thing to them. Just because one thing is doing well doesn't mean the other will go away.
Heck, from these FY reports that we usually get, SE has been adamant in saying how delivering console games is part of its company DNA is an important thing to them. Just because one thing is doing well doesn't mean the other will go away.
I'd say something bitter and angsty about what this means for the future of the only sector out of those three divisions that I remotely care about, but the fact of the matter is, Masuda is still fueling a lot more into the next couple of years than we had previously anticipated. Based Sony, I guess, for pouring money into deals.
Now I just have to start praying Sony continues finding immeasurable console success, because once that cord gets cut, I daresay things are gonna get ugly.
Now I just have to start praying Sony continues finding immeasurable console success, because once that cord gets cut, I daresay things are gonna get ugly.
I'm totally fine with them having success with mobile as long as they're making games I want to play.
The announcement of Star Ocean 5 has put me in their good graces for a while.
Record Keeper is a legit game. All the bravest was just shit.
The announcement of Star Ocean 5 has put me in their good graces for a while.
Record Keeper is a legit game. All the bravest was just shit.
I don't want more Final Fantasy All the Bravest trash, do you?
No?
Not a bad thing but as a shareholder driven corporation would you rather:
Invest 100 million in 100 one million dollar budget mobile games that have the possibility of being a huge hit for at least a handful of them and altogether bringing in hundreds of millions of dollars in profit.
Or invest 100 million in a single traditional game that might sell a couple million or bomb.
It's a pretty easy choice to bail on traditional gaming if you just look at the money the return isn't worth the risk for AAA anymore.
That huge cost of making MO MONEY.
Right, but I'm saying that although mobile is doing well, it doesn't mean that they'll only make mobile games or whatever. I also think that even with this success, they'll continue to support AAA games while it's still viable since it's a major pillar of the company.
I think their business model should change with regards to these massive AAA games like FF and Tomb Raider by making it episodic in nature, having an incentive to do in-game purchases, etc.
I'm just saying that with this success, there won't be a shortage of AAA games. If their future AAA games start bombing considerably and it's juxtaposed with their mobile success, then it's another matter altogether.
True, people make a big deal out of all the "wasted resources" on the XIII sequels, but it's really nothing compared to what was canned to remake XIV.
At least we got an awesome game out of it. Can't wait to play Heavensward.
Rats Off To Ya
Banned
I continue to be incredibly pleased by FFXIV's success. It's brilliant, and it's ruined all other MMOs for me. Amazing to think that a game so dead on arrival would go on to be the only viable subscription MMO outside of WoW. Yoshi-P should be running the whole company.
Velcro Fly
Member
Mobile done well is fine.
Kudos to square for turning it around.
Not sure I'll ever see a phone as a true gaming device though.
I do want to try FFRK though
Kudos to square for turning it around.
Not sure I'll ever see a phone as a true gaming device though.
I do want to try FFRK though
While true XIV is going to be a source of steady profit for years to come, which is immensely important if Square Enix is ever going to take risks again.
As for mobile itself, it's not bad exactly, it just isn't what I'm looking for in a gaming experience right now. Additionally, I don't blame companies for cashing in on it right now as it is a growth market. Down the line however, mobile gaming is eventually going to peak, once that happens we have no idea what's going to happen to it next. As a market it probably isn't going anywhere, but who knows what the growth market after that is going to be.
Keeping some resources in console development not only means that they can continue taking advantage of what profits may be there, but it also keeps their options open in case things change down the line.
Well they have a better idea what sells now. Their first few years of mobile development ended up looking a lot like Portable Game development, with a lot of titles like The World Ends with You and what not. These games while decent sellers, aren't really the types of games that drive profit in the mobile arena.
SE clearly has an idea what drives profit now, and is taking advantage of it.
Felessan
Member
Bad mobile games don't sell. Even a good ones might not sell well.
Or you can fail at all your mobile games and be at a big loss. Market for mobile consolidates rapidly and there are already a very big difference between top seller and even mediocre seller (difference between 1st and 100th in revenue is around 50 times) and more and more people tries to ride this train increasing competition.
It seems SE understands pitfalls and thus they diversify their business into various areas and support everything to make sure that they will not struck if market becomes oversaturated. It's in their presentation - they wants big games, medium-sized games and small games. And they (obviously) want traditional HD games, MMO and mobile.
MrNyarlathotep
Banned
Of the various divisions of Squeenixdos, I think its the Eidos side of things skating closest to being the next THQ more than the Square or Enix sides
Yeah, a smart company makes a diversified portfolio if they are able to so that should one sector of their business fail, the company can rely on other sectors. For example, Square's attempt to revive FFXIV from the dead could have failed, but they would still have their traditional games and their mobile games to lean upon.