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[Thick Thighs Save Lives]

Square Enix announced on April 30 that they are expecting an extraordinary loss of 22.1 billion yen (over $140 million based on recent conversion rates) in the fiscal year ending March 31, 2024. The losses are related to the revision of Square Enix’s development policy and the scrapping of ongoing projects* (source: Takashi Mochizuki).
*The report does not clarify whether this relates to one or multiple titles.

According to the announcement, Square Enix’s board of directors decided in a meeting held on March 27 to revise the company’s development policy for HD video game titles “due to diverse changes in the environment and in an attempt to allocate and concentrate development resources.” As a result, they expect to record losses of approximately 22.1 billion yen related to the cancellation of ongoing title(s). Square Enix are currently revisiting their consolidated financial forecasts for FY 2023 based on these and other factors and will publish a revision if necessary.

Square Enix expects loss of $140 million from cancelled video game title(s) - AUTOMATON WEST

Square Enix have reported that they expect a 22.1 billion yen loss in fiscal year 2023 due to cancelled video game project(s).

automaton-media.com

 

[TintoConCasera]

Any hint on what those cancelled titles might be? I'm a bit worried about Dragon Quest XII and specially the remake of III, which we haven't heard about in ages.

 

[Zheph]

Any hint on what those cancelled titles might be? I'm a bit worried about Dragon Quest XII and specially the remake of III, which we haven't heard about in ages.

Likely smaller projects which could involved the remake but hard to say for this one

 

[Sensei]

Any hint on what those cancelled titles might be? I'm a bit worried about Dragon Quest XII and specially the remake of III, which we haven't heard about in ages.

I won't be so worried about these games. They should both sell well, especially in Japan, on the strength of their names alone (and especially because it's likely that they'll both release on the Switch/Switch successor).

I'm more worried about the FFIX remake/remaster and especially the FF Tactics remaster.

 

[crackajack]

Maybe this number isn't even that big compared to past years and other devs, for me it seems wild though. Games that were seemingly considered (much) worse than the okay but presumably failed Foamstars costing hefty sums before any marketing which is seemingly often more costly than the actual development.

Certainly true also for other publishers and their cash cows but feels like SE only exists due to FF and DQ and nothing else they try really sticks their landing.

 

[ShaiKhulud1989]

140 million is one aaa budget in current economy. While painful it’s a necessary and much needed step for Square in all honesty. They were spreading themselves too thin for years now.

 

[squarealex]

Any hint on what those cancelled titles might be? I'm a bit worried about Dragon Quest XII and specially the remake of III, which we haven't heard about in ages.

FF7 Part 3.0+1.0

 

[tommib]

That’s not a lot of money is it? That’s half of Ragnarok.

 

[Ozriel]

That’s not a lot of money is it? That’s half of Ragnarok.

Of course it’s a lot of money.

 

[Chukhopops]

My guess: it’s one of the planned remakes from the PSX era FF games (maybe IX)

If the accounting rules are the same in Japan as the rest of the world, then the decision to use extraordinary losses is based on the desire to not impact operating result. Which is very interesting in the case of SE.

 

[GymWolf]

 

[cash_longfellow]

My guess: it’s one of the planned remakes from the PSX era FF games (maybe IX)

If the accounting rules are the same in Japan as the rest of the world, then the decision to use extraordinary losses is based on the desire to not impact operating result. Which is very interesting in the case of SE.

There is no way they are cancelling anything Final Fantasy related.

 

[tommib]

There is no way they are cancelling anything Final Fantasy related.

If anything they’re cancelling everything non-FF and AA. They’ll double down on big productions.

It is what it is.

 

[ShaiKhulud1989]

There is no way they are cancelling anything Final Fantasy related.

I'm almost sure its the barrage of obscure jRPG remakes, small jRPG titles and some mobile fluff. The sum while perceived big is too low to scratch anything AAA-related.

 

[cash_longfellow]

I'm almost sure its the barrage of obscure jRPG remakes, small jRPG titles and some mobile fluff. The sum while precieved big is too low to scratch anything AAA-related.

Yep, that’s what I’m thinking as well.

 

[Boss Mog]

Hopefully it's not Just Cause 5 but I have a feeling it would be on the list of cancelled titles.

 

[Shifty1897]

We're never gonna see Final Fantasy Tactics Remastered, huh?

 

[Chukhopops]

There is no way they are cancelling anything Final Fantasy related.

I don’t know of course. But since this refers to the HD segment this already rules out mobile games and MMOs which are in a separate segment.

SE also published in Nov 2023 their annual report where they said they wanted to diversify and listed the « limited diversity of their title portfolio » as a key aspect to address, so cancelling one or several new titles six months later would be odd.

IMO it’s either a full stop on the GAAS train or one of their big planned remakes.

Also the amount is quite gigantic, 22bn JPY is a lot out of their planned full-year 55 bn operating income target.

 

[Thick Thighs Save Lives]

Any hint on what those cancelled titles might be? I'm a bit worried about Dragon Quest XII and specially the remake of III, which we haven't heard about in ages.

I don't think it's DQ XII.

 

[Pejo]

Any hint on what those cancelled titles might be? I'm a bit worried about Dragon Quest XII and specially the remake of III, which we haven't heard about in ages.

Boy I don't know, after hearing about what they were doing to DQXII it might not be the worst thing if it just gets straight up cancelled.

 

[IlGialloMondadori]

Probably doesn’t spell good news for Octopath unfortunately. Who knows?

 

[TintoConCasera]

Boy I don't know, after hearing about what they were doing to DQXII it might not be the worst thing if it just gets straight up cancelled.

I think I missed some news lol, what happened? Last I heard they seemed to want to make it more "mature" (which already seems like a mistake imo) but aside from that, nothing else.

 

[Mokus]

No worries, Sony will loan them in exchange for some exclusives just as they did 20 years ago.

 

[yazenov]

I didnt read the subject but that's what SE gets for not releasing their games on Xbox and Gamepass!

 

[Pejo]

I think I missed some news lol, what happened? Last I heard they seemed to want to make it more "mature" (which already seems like a mistake imo) but aside from that, nothing else.

The dark/edgy part and most notably the part about switching to action or hybrid combat was what had me in full on panic mode. I don't remember the actual words he used in the interview I read a long time ago, but it was something about tweaking the gameplay to be more action oriented or something. The rest is unverifiable leaks or conjecture but that's enough to send up a few red flags for me, personally.

 

[TintoConCasera]

The dark/edgy part and most notably the part about switching to action or hybrid combat was what had me in full on panic mode. I don't remember the actual words he used in the interview I read a long time ago, but it was something about tweaking the gameplay to be more action oriented or something. The rest is unverifiable leaks or conjecture but that's enough to send up a few red flags for me, personally.

I'm not 100% sure either, but last time I read about the subject people seemed to have debunked the action-based combat rumor.

As I said, I'm not sure, but man do I wish for that to be the case. DQ won't feel like DQ at all if it's super edgy or has ARPG combat. Shit sounds like FF XVI.

 

[Go_Ly_Dow]

So this is related to this announcement back in Feb:

Square Enix reviewing overall game development to improve quality

Square Enix will review its development system to improve the quality of its games, company president Takashi Kiryu has…

www.eurogamer.net

Square Enix will review its development system to improve the quality of its games, company president Takashi Kiryu has announced.

Kiryu's comments were made during Square Enix's latest financial results briefing, Bloomberg reported, during which he indicated a policy of reducing outsourced development and focusing on large-scale games developed in-house, with the aim of boosting both the quality of games and profit margins.

The new system is set to be announced in spring, with multiple sources at the conference call stating it will be in effect in April. That would align with the company's new financial year.

So I imagine this kind of news is probably centred around the low and mid budget stuff (Forspoken, Balan, Triangle Strategy etc...) and perhaps the likes of Star Ocean.

Then they will probably invest more into FF, KH, DQ, NieR and a few other more popular IPs as a result of centralising company and dev resources around less games.

 

[ArtHands]

So this is related to this announcement back in Feb:

Square Enix reviewing overall game development to improve quality

Square Enix will review its development system to improve the quality of its games, company president Takashi Kiryu has…

www.eurogamer.net

So I imagine this kind of news is probably centred around the low and mid budget stuff (Forspoken, Balan, Triangle Strategy etc...) and perhaps the likes of Star Ocean.

Then they will probably invest more into FF, KH, DQ, NieR and a few other more popular IPs as a result of centralising company and dev resources around less games.

I thought Forspoken is AAA?

 

[adamsapple]

Whelp, so much for the Forborin' sequels.

 

[Elios83]

Forspoken 2 and Foamstars 2

It's probably some smaller AA new titles/remakes that they had in development.
They already said a few months ago they all performed badly and they wanted to refocus on high quality AAA.
Probably Octopath Travelers will be saved, one of the executives behind that was promoted.

 

[MoreJRPG]

Who would have thought ignoring PC for the bag for PlayStation exclusive content would kill your business?

 

[Efren is G.O.A.T.]

Man I really want them to succeed, I have too much nostalgia linked to Final Fantasy! I thought that XVI, VII Remake and VII Rebirth put them back on the map after the so-so reception of the XIII trilogy and XV.

 

[Mibu no ookami]

Who would have thought ignoring PC for the bag for PlayStation exclusive content would kill your business?

PC was never going to save Square Enix.

 

[Hudo]

I don't think it's DQ XII.

But now we can definitely be sure that DQ12 is the last one where the "old guard" is at the helm so to speak. I bet that Yuji Horii will retire after DQ12 is finished and hand it over to whoever he thinks is a good successor to him.

 

[Ozriel]

I didnt read the subject but that's what SE gets for not releasing their games on Xbox and Gamepass!

Rent free.

 

[Fabieter]

So haters finally manged to kill AA games from sqaure enix.

 

[Fabieter]

Who would have thought ignoring PC for the bag for PlayStation exclusive content would kill your business?

This is mostly the underperforming of all smaller games which mostly were multiplatform, but haters hated their games anyway.

 

[Ozriel]

This is mostly the underperforming of all smaller games which mostly were multiplatform, but haters hated their games anyway.

Not all, though. Can’t imagine why they didn’t just put those smaller games on every platform.
Harvestella didn’t get traction on Switch. Could have also made it a PC release.

 

[joeygreco1985]

I really hope this pushes Square to get their stuff on PC faster. Still waiting for FF16 and 7 Rebirth to come to PC and there are no release dates, just winks and nods to some arbitrary exclusivity period. It's bad business

 

[Mibu no ookami]

I really hope this pushes Square to get their stuff on PC faster. Still waiting for FF16 and 7 Rebirth to come to PC and there are no release dates, just winks and nods to some arbitrary exclusivity period. It's bad business

I love how people ignore data. It's like you think Square Enix doesn't have a history of releasing games on PC and Xbox.

They know at which ratio their games sell on these platforms relative to PlayStation and that is part of their negotiations for exclusivity with Sony.

Xbox and PC wouldn't have saved Square Enix.

 

[Fabieter]

Not all, though. Can’t imagine why they didn’t just put those smaller games on every platform.
Harvestella didn’t get traction on Switch. Could have also made it a PC release.

Harvestella is on pc since day one.

 

[Mibu no ookami]

Not all, though. Can’t imagine why they didn’t just put those smaller games on every platform.
Harvestella didn’t get traction on Switch. Could have also made it a PC release.

Massive mistake not to get Octopath Traveller 1 on PlayStation somehow. Perhaps they're bound by agreement still as I think Nintendo helped fun the first game, but somehow okayed the release on Xbox.

 

[Fabieter]

Massive mistake not to get Octopath Traveller 1 on PlayStation somehow. Perhaps they're bound by agreement still as I think Nintendo helped fun the first game, but somehow okayed the release on Xbox.

Yet OT2 was on everything but xbox and it bombed.

 

[JimmyRustler]

Can't they deduct a lot of this from their tax? Probably sounds worse than it actually is for Square.

 

[poppabk]

PC was never going to save Square Enix.

Not from some of their bad decisions. But comparing Capcom and SE, the path SE has taken with their premier franchises is probably not the right one.

 

[Evil Calvin]

If they only had quality western studios and games like Hitman and Tomb Raider................

 

[Mibu no ookami]

Yet OT2 was on everything but xbox and it bombed.

That's kind of the point... It's really difficult to get people into a franchise late when they don't have access to all the games. That's why they tried to set it up as not needing to play the first game. That works sometimes and sometimes it doesn't.

It worked for Persona 4 and Persona 5, but the franchise really established itself as being unrelated over the course of multiple games.

There is a reason they named God of War 2018 God of War instead of God of War 4.

They probably should have negotiated harder with Nintendo the ability to release the first game on PS4 and PS5.

 

[Aion002]

Good... Stop making crap like Foamstars.

 

[James Sawyer Ford]

Not from some of their bad decisions. But comparing Capcom and SE, the path SE has taken with their premier franchises is probably not the right one.

Seems right to me, they are reviewing and selling well and will release later on PC which nets them additional income

Why are people acting like these games won’t eventually come to PC?

 

[Fabieter]

That's kind of the point... It's really difficult to get people into a franchise late when they don't have access to all the games. That's why they tried to set it up as not needing to play the first game. That works sometimes and sometimes it doesn't.

It worked for Persona 4 and Persona 5, but the franchise really established itself as being unrelated over the course of multiple games.

There is a reason they named God of War 2018 God of War instead of God of War 4.

They probably should have negotiated harder with Nintendo the ability to release the first game on PS4 and PS5.

Get what you are saying but it still sold worse than part 1 on pc and switch.