I don't see an issue with the statement.
Generally speaking, development teams are shut down for failure of process, not failure of product.
Failure of process would be things such as shipping a poor quality game, taking way too long to ship a game, and/or spending way too much money to ship a game.
Failure of product would be having your game sell poorly.
BioShock Infinite is an example of a failed process with a hugely successful product. The studio got shut down despite the game shipping over 11 million copies and still being listed as a key IP for the company due to how bad the development process was.
Bayonetta (or many of Platinum's other titles honestly) is an example of a failed product. Platinum Games can still perpetually get work because they deliver products on time, on budget, and generally speaking, with the expected quality.
The reason for this distinction is that a development team that ships on time/budget and on quality can simply be transferred to another IP (or make significant changes to their existing IP) in an attempt to sell better. A developer who can barely ship a game at all, by comparison, is a huge risk regardless of what they're working on, especially since games get perpetually harder to make.
The exception to this is when a company as a whole is going through massive cutbacks, but that's not the case with Square Enix.
You might think "What if the studio can't transition to a new genre if their entire genre is doomed?" Well, that shows up as failure of process at some point along the line where they're shipping 7/10 games in the new genre they're working with.
Generally speaking, development teams are shut down for failure of process, not failure of product.
Failure of process would be things such as shipping a poor quality game, taking way too long to ship a game, and/or spending way too much money to ship a game.
Failure of product would be having your game sell poorly.
BioShock Infinite is an example of a failed process with a hugely successful product. The studio got shut down despite the game shipping over 11 million copies and still being listed as a key IP for the company due to how bad the development process was.
Bayonetta (or many of Platinum's other titles honestly) is an example of a failed product. Platinum Games can still perpetually get work because they deliver products on time, on budget, and generally speaking, with the expected quality.
The reason for this distinction is that a development team that ships on time/budget and on quality can simply be transferred to another IP (or make significant changes to their existing IP) in an attempt to sell better. A developer who can barely ship a game at all, by comparison, is a huge risk regardless of what they're working on, especially since games get perpetually harder to make.
The exception to this is when a company as a whole is going through massive cutbacks, but that's not the case with Square Enix.
You might think "What if the studio can't transition to a new genre if their entire genre is doomed?" Well, that shows up as failure of process at some point along the line where they're shipping 7/10 games in the new genre they're working with.