Square Enix Profits Plunge 76% on “Discerning Consumers”

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Square Enix is reporting profits for fiscal 2010 to date are down 76% to a mere $22 million, a change it blames on “more discerning consumers.”

Sales are also down 27.5% to $120 million, with a 58% decrease in operating profit.

Announcing the disastrous figures, Square Enix offered this excuse:

“Consumers have become relentlessly discerning, and the gap between titles which sell and those which don’t is widening. We’ll recover by investing in quality products which will appeal to consumers.”

Needless to say, its stock price is now at the lowest ever in the company’s history.

With a succession of handheld and mobile games all it has scheduled for release, and the poor reception of such “new IP” as NieR and Mindjack, to say nothing of the disaster which is Final Fantasy XIV, it is hard to see any imminent improvement in the company’s financial position.

With the last decade a succession of increasingly dire failures, and that decade also strangely coinciding with the tenure of Yoichi Wada as CEO, it seems increasingly clear only his departure is likely to restore the company to growth.

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  • What they need to do is make a Final Fantasy that isn’t linear (FFX, FFXIII). They need to go along the lines of 7, 8, and 9. Creating a world that’s worth exploring with towns, dungeons and most importantly, more side quests. The only thing that kept me a fan of this series is the music. Another thing that was missing from FFXIII was true stat-maxing. I wonder what it would be like if they combined FF Tactics’ ability set up, FFVIII’s Junction System with FFX’s Sphere Grid. Either way, I will always be loyal to the end, whatever that end may be.

  • Who cares about the “JOB SYSTEM”

    The main fact is this, all other MMO’s don’t charge you for a EXTRA CHARACTER.

    I don’t give a shit, if they can do 1000000 jobs.
    The main fact is this INVENTORY SPACE/STACKING/RARITY.

    Its a freaking fantasy game for damn sakes.

    Grind—–> I’m out of space
    I have to go to town to store shit (BORING)
    I have to vend shit for gold (BORING)
    I have to leave guys out of SPACE (BORING)

    This is why Warhammer Online is BETTER
    —— GOLD IS PRACTICALLY USELESS in this game which makes it fun, all its for is TRAVELING.
    This alone makes it a GREAT INNOVATION unlike all other MMO’s.

    You earn money by killing players, and you don’t LOSE money or Exp killing players or dying to mobs.
    There is no downtime, 20silver… for dying/recovering 10% max hp from weakness.

    Lets put it like this.. im sitting at 400gold for the last 2+ Years in Warhammer and I never needed to buy ANYTHING from ANYONE and I’m still having fun playing vs real Opponents.

    AI give me a break, if you want to beat AI go play a console game alone. MMO is about testing your wit vs other people solo/team/guild/faction/race.

    This GAME LACKS THIS SHIT ENTIRELY.
    HENCE ITS A SHITTY GAME

    No innovation, the players want to FIGHT each other and go to war with eachother, you got 3 Cities and yet… no War? You show videos of a Great war in the skies, yet there is NO WAR IN THE GAME.

    BULLSHIT ADS, STUPID GAME.

  • Here’s a couple of protips for Square-Enix if they want to do better in the future.

    For one, they need to stop being a bunch of prickteases and actually produce the enhanced remake of FFVII. It’s been over five years since that E3 “tech demo” that got everyone excited for a graphically-enhanced re-release. FFVII is still their best-selling title to date, so it’d be foolish of them not to go through with the remake.

    Second, they need to make better games. The FF series has been IMO going downhill for the past decade. FFXIII was criticized for, among other things, being overly linear and restricting you to one playable character in your three-character party. FFXIV has been an total failure both critically and commercially. Obviously, trying new things isn’t working out for them, so maybe they should go back to the basics. Current-gen graphics are fine and all, but perhaps a return to a more old-school style of exploration and gameplay should be considered for FFXV: world maps, towns, distinct classes for each character, and various other elements more reminiscent of, say, FFIV and FFVI.

    If they do these things, maybe, just maybe, they might see things turn around.

  • You know for all the shit Final Fantasy XIV gets, the new producer Yoshida is actually doing a lot of good for it. Was it awful at launch? Yes. If it had launched the way it is now, it would have gone much better. Things are only improving and PS3 launch hasn’t even been announced. It’ll have a good shot at success at PS3 launch.

  • Obviously those people don’t know what they’re doing. Final Fantasy was supposed to be the last game brought out buy a failed, dying company and it turned out to be a golden egg laying chicken.
    How did they manage to turn that into their doom?

  • I don’t know about Neir, but Mindjack according to Angry Joe’s review is already a contender for worst game of the year. FF13-2 doesn’t look promising. the Kingdom hearts series is all but too confusing now, not to mention the fiasco which was Kane & Lynch 2… if the company is hoping for Tomb Raider to save them, either way Squenixdos japan is doomed.

  • 13 did horribly,14 hasn’t done ANYTHING, moving on they’ve got an “original” game that recently came out called “Lord of Arcana” also known as a Squenix version of Monster Hunter. Which takes the blatant easiness of Quick-times and the summons from FF/etc to smash them into MH. Overall the game is okay, that is of course if you like fighting against easily defeated monsters in a hunting game with a “story”, that leaves you no more satisfied then when one gets hit with a car. If they intend to change gears they should stop rushing FF titles and improve on story rather than try to cram insane graphics and linear storytelling, into a single game, across multiple discs. Oh that and not making a Kingdom Hearts sequel every 6 months :/

  • square failing again?

    how to fix?

    return to the old days of squaresoft when their games where actually good and stop tarnishing the FF name with crap sequels and side projects like MMO and FF13-2 that nobody wants.

    stop being pussies when it comes to foreign direction from the US, They should have put their foot down when it came to the whole NIER bullshit of making 2 different games. ridiculous.

    They are a japanese game company, that make japanese games, stop acting like your the next evil empire like EA or Activision.

  • Until they get back to their roots, I don’t see Square digging themselves out. A lot of RPGs out there fail to achieve the simplest part about creating a fictional world. Cultures, doesn’t have to be deep and overly developed, just different enough around the regions of the world that you feel like your actually exploring a whole world. That groundwork for cultural definitions helps a lot with developing characters as well, because then you have an archtype established for their general personality and tastes. Cultures also help develop dungeons that make sense for the area they are in and add an extra sense of depth behind the dungeon’s purpose.

  • Quality products eh? If you’d done that from the start you’d never be in this position.

    Tho, the same disaster now needs to happen to the likes of Nandai Scamco, Scamcom, Sucktivision, Ubiscam, etc…

    The gaming world needs to wake the fuck up and STOP BUYING shit from companies that release:

    1) Buggy unfinished games
    2) Games with over 40% content cut out as DLC
    3) Games with deliberate disc locked content DLC
    4) Games with shallow (4-6 hrs) of real content with a tacked on multiplayer component in the hopes that it will compensate for the lack of REAL content, or the fact the company released an unfinished game at full price.

    But then again, if people followed the above 4, nobody would buy any games at all anymore. That’s how fucked up this gen has become.

    And then they wonder why I pirate…

  • “We’ll recover by investing in quality products which will appeal to consumers.””

    STOP DOWNGRADING YOUR PERFECT GAMES FOR THIS SHIT 360

    I HOPE EVERYONE AT SQUAREENIX EXCEPT NOMURA DIES IF THEY PORT > THE ULTRA PERFECT VERSUS 13 < TO THE SHIT60 BECAUSE NO ONE NEEDS ANOTHER FF13

    FF13 had so much more content as a PS3 Exclusive
    They had to delete everything because that shit crap console cant handle a PS3 Exclusive
    Now we get FF13-2….Awesome
    THIS IS WHAT YOU GET FOR SUPPORTING Terrorists from the USA

  • Remembers me at the time when they near went bancrupt, because of Spirits Within.
    At that time Sony gave them (Square Soft, they were a lot better that time) a lot of cash to continue to make games and of course the fusion with Enix.
    I think they afterwards kicked Sony hardly in the balls by going multi and some other things.
    Maybe Sony will use this to get some revenge and buy them completly now.

  • Sometimes I wonder if they even play their own games before releasing them…

    The profits are taking a nose dive with the quality of their games. I used to be so happy to buy games with the Squaresoft logo, but now if I see the words “Square Enix” on the box I run the other way.

    • clearly customers are not discerning if world of warcraft is still one of the most played games to date. that’s like saying crack addicts are discerning individuals because they know which crack is best.

        • Anonymous
          15:42

          wow is rediculusly easy in the beginning, i just played it for a few hours, got to 10, and stopped for the day, all in all, 4 hours max.

          i appreciate the way quests are gotten, far more so than everquest. however the game seams to ramp the difficulty up allot at the higher end.

          an mmo needs to hold your hand in the begining. possibly show you 4-5 teirs of armor (what you can get at 10-20-30-40-50, so you have reference for how good something should be. and than kick your ass. i think an mmo should have a learning curve, and they all need better in game tutorials, for everything.

        • Well considering how Blizzard has good community because they talk to players and try to reason with people who have issues with the game and try to fix those issues.Square soft doesn’t have people who can reason with players who have issues with the game.

          DC Universe Online for example has a bad community right now because SOE choose to ignore information that could help them make there Online games they developed better.They had made some popular MMO such as Everquest,Free Realms,Star Wars®: Clone Wars Adventures™,EverQuest® II I was surpise some have a big support in the MMO Community.

        • Ridiculous comparison.

          WoW is accessible. By being easier than other MMOs, WoW attracts people who don’t play much or would suck at harder games.

          WoW is successful. It is riding on the social factor now. Everyone knows someone who plays WoW. When you pick up an MMO do you play with friends or try a new game by yourself?

          WoW has frequent and significant content updates. This is possible because the game is successful.

        • when i was in school, i hung out with the stoners, mainly because they rarely talked about fucking sports, or clung to their girlfriends obsesivly.

          now, they would not smoke shit, if they had anything better.

          its like comparing the leaves to the buds. there is thc in both, but the buds got so much more than the leaves.

          or swag to the keff (sp on both, never been a stoner, but i know what they mean)

          now in an mmo, community is EVERYTHING, more so than gameplay.

          wow has the most active userbase of all mmos that are currently active, it doesn’t matter if the user base is made of rocket scientists, or of 12 year olds screaming foul language into the mic, there is opertunity for EVERYONE to have fun in that game.

          now ff14, even if you can look passed the game flaws, only 25000 people play that game, and for anyone who doesn’t know thats fucking pathetic. for any server to even feal populated, you need closer to 5000 per server.

          i play the test server in everquest, less than 200 people will be on at any given time, and at (normal) peaks (not the servers went down but test is still up peaks) little over 1000. it feals like NOBODY is ever playing the game with me, im a soloist, i went from level 1-83 with 1400aa basically solo, its not the best, but its damn good compared to people who cant solo at all.

    • Of course. Seems that some people don’t understand how companies work. First you become succesful and aim to make profit. The next step is lifting your legs onto the table and go posting on the internet. Then you either go bankrupt or go back to phase one.

  • UBER SCREWED! yoichi wada fire his ass and they will recover. anyone ever read the interview with nobuo? they moved their offices from meguro to shinjuku because wada listened to a fortune teller.

  • They are trying with FF14 at least. The new producer has a lot of energy, knows what needs to be done, and communicates MUCH better than anyone else I can remember at SE. Unfortunately, there’s only so much he can do at once, and the game already has the taint of a horrific launch.

    As for other games, well, they need to stop putting out crap on mobile phones and portables that only Japanese people play and focus on quality titles for the real consoles. Some good new IPs like they were pumping out nonstop 10 years ago, and refocusing some existing IPs will also help. For instance, they need to stop with the endless spinoffs that only further complicate the labyrinthine canon of Kingdom Hearts and come out with KH3 before the value of that brand completely evaporates. Unfortunately they already announced FFXIII-2, but they need to hurry and move on to XV as soon as they can to get a fresh start.

    • Yeah, Lost Odyssey is the best RPG I have played in a decade.

      Too bad few who play RPGs have heard of it since it was doomed to a 360-only release. The game is incredible and yet no one can play it, and since no Japanese people have played it (due to there being only 3 or so 360 owners in the country) the likelihood of a sequel is slim…

  • There’s one thing I wish that development studios would do.. get some good PR guy and get on public talk shows(i know there’s alot in Japan, there’s lots in the US like the daily show, colbert report, late late show, etc), but by getting on tv, with a huge audience, they can pose the question to the viewers…

    What kind of new games do you want?

    It’s really that simple! ask what we want, we tell them, they can start on what should work! simple… instead, guess work = shoddy work = gamers get blamed for supposedly killing the industry by not supporting crap…

    • With few exceptions square has been using the same people since the first final fantasy for all their games. They are still working there and responsible for the current games. FF13 was produced by the guy that directed 6,7, 8 and Chrono Trigger. FF12 was directed by the guy that directed 6 and 9.

      They need to go back to making games they want to make and stop making games trying to please everyone.

  • Maybe this’ll make them realize they needs the diversity they had back in the PS1 days…

    Maybe they’ll smarten up and buy back monolith so we can have a Xenogears remake? That’s probably a stretch…

        • I can’t even comprehend why they always need to monkey around with the gameplay in every game. Like a CT sequel with pretty much the same mechanics wouldn’t sell…

          Don’t people generally play these games for the characters/story/graphics? I could give a rat’s ass about innovative gameplay in a JRPG. Maybe I’m just weird.

      • Sorry, not happening. Wada’s still pissed that Chrono Trigger DS ONLY sold a paltry million copies. A sales figure any other JRPG company would kill for, but SE still took a loss on it because Wada produced way too many copies of it, as always. Most people would learn after making the same costly mistake dozens of times over…not Wada, however.

  • I no longer have time to play the drivel. Last month i bought Starcraft2 infact just to have some game to play, it lasted 1 week, haven’t played it since either so there are more companies out there making crap too.

  • Wada really needs to step down from the presidency and the presidency should be given to someone that likes and knows what good games are instead of a guy that only thinks about money and not the quality of its games

    • The sad fact is, that this would actually be the quickest path to a massive amount of sales. An entire generation grew up with Final Fantasy VII as their first RPG, and more still remember it fondly for all the hours invested into it.

      Now, I’m fully aware that much of that fondness is probably viewed through rose colored glasses. There were translation issues everywhere in the US release of the game, and there are certain spots (say, the cross-dressing brothel scene) that would probably just need to be reworked or axed entirely when the character no longer looks like a box with spiked hair and legs. The story itself was also a bit obtuse, and would need to be re-scripted out to make more sense overall.

      Despite this, I maintain that FF7 was in fact a good game. It had a very solid battle system, both reminiscent of the old style turned based battle systems, and with the customization through (for a while) limited materia to create the party you wanted to play. It took you to a large variety of varied locations, and while it guided you for a large chunk of the game, the open world map had enough secrets and side-quests that you didn’t feel trapped on a path like FF13 does.

      At this point I almost have to believe that they’re refusing to remake it out of pure stubbornness rather than all the excuses they’ve used before. Their game engine is finished, and the FF13 team didn’t really need to go on and make a sequel, and yet they are. Final Fantasy I has been remade how many times, for how many systems now? They’re certainly not afraid to whore out their old games over again. So maybe Wada really does need to go. A change in leadership have them stop giving the finger to fans asking for a remake, and they might start turning a decent profit again.

    • So their Bottom line is still in the Green/ Black Not In the Red Ink and the Share Price has Plunged to an all time low

      Seems like a Buy to me honestly

      My reasoning it’s still Profitable just far less than before and value wise it has traded for more money when it was worth less, although the outlook is a bit dim to compensate we will see if they can turn it around but at this price I don’t think I would see a bankruptcy guys So Buy ^^.

      If not and people are pessimistic then Short IT XD it is at the 52 week low gotta find the support somewhere haha.

      http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?ticker=9684:JP

      • what’s the problem? redoing ff14 letting users play for free, kingdom hearts birth by sleep, ds remakes, and also ff13 was actually better than any call of duty (and the last sold 10 million copies in the first week), and with less bugs.
        that’s actually quality.

        the last call of duty: bugs, short story, same old gameplay, same old graphic.

        kinect games: casual shit. still killapps.

        i agree with square. new gamers are just casual gamers or american macho likers.

        • FF14 being free is not them being philanthropists. It doesn’t make them money. Obviously this was intended to be their “killer title” for the end of the year.

          I also like how you rag on casual games then defend S-E for releasing games for portable systems, which are more casual. Same about remakes. CoD is nothing but remakes, but S-E DS remakes are so awesome!

        • The sad thing they know what the user base wants and its 3 games FF7 remake, Kingdom Hearts 3 and Einhinder 2. That’s all they want and they say FF7 remake is too hard then what the fuck is making three games at one time is…EASY give me a fucking break SE.

        • That’s a load of elitist bunk.

          It’s generally accepted that folks would pay for something good rather than receive garbage for free, and all the retooling in the world won’t make all the previous bad press go away. Not to mention your opinion on the quality of call of duty hardly being objective or as absolute as implied.

          Square-enix constantly underestimates their user base in both the Japan and NA markets and now they’re paying for it.

      • They are doing it now, their investment is a damn near rewrite of FFXIV while charging the users nothing and still letting them play. Hopefully the XI team can fix it because they are losing their asses on those servers.

        A real investment would be dropping the enix…

        • @ Tano

          Please don’t try to defend bad games by putting down other games. Games that are a decade old to boot.

          And don’t blame other consoles either. Whether that is true or not, it was still a decision made by SE. If the game was hypothetically fantastic before it went multiplat, then SE made some awful decisions by throwing tons of design and programming work in the garbage bin.

        • Hopefully the XI team can fix it because they are losing their asses on those servers.

          The original XI team did make 14, hope you weren’t one of those people trying to imply otherwise.

        • “With the last decade a succession of increasingly dire failures, and that decade also strangely coinciding with the tenure of Yoichi Wada as CEO, it seems increasingly clear only his departure is likely to restore the company to growth.”

          When a mighty tree producing quality fruit has parts that start festering with diseases, said parts need to be cut off…

          *looks at Yoichi Wada*

          With a double-bladed flaming chain saw…

          -Azure Xuchilbara
          (account suspended)

        • FF13 is that bad. When all you are doing is walking down a corridor and blocked off by invisible walls for a majority of the game, you are playing an rpg that not only is made for retards, you are playing an rpg that doesn’t even satisfy in the least even in terms of story. The only credit can be gievn to it is the visuals and that makes it nothing more than a mediocre hollywood flick. Sure Americans play shitty games but shitty generic rpg xy is still just as bad. And call of duty as crappy as it is, has at least a passable multiplayer aspect to it that supplements the shitty campaign.

        • i can’t believe you’re blaming a jrpg for using invisible walls…

          it’s like you’re blaming every jrpg produced until now.

          a corridor? come on, it’s linear just as ffx, with 65 optional missions in grand pulse.

          still less than the other games from the same franchise, but i believe it’s enjoyable. it’s not so bad.

          consider also that SE had to cut 5 gb of maps and items from the final version because of the xbox360.

          think about it: the only part of the game that is not linear and that you can explore again aven after beating the final boss is in the last DVD (from chapter 11).

          blame microsoft for that. ff13 was going to be a really good game. now it’s just 8/10, but always better than COD. imo.

        • what we cant like both macho shooters and rpgs now?

          perhaps i may be mistaken, but older more successful rpgs simply focused on being fun and good as opposed to targeting demographics, i think while targeting demographics has certainly been a positive step for marketing, and in many cases it has shown results. it seems like SE makes the target market their main focus for the game rather than actually making the game “fun.”

          and dont go blaming names for this, as the enix side was well settled in developing games for entertainment. they were the ones who brought games like valkyrie profile and star ocean to the table.

        • they are redoing ff14 letting users play for free, and let me say that ff13 was not so bad at all. and what about birth by sleep?

          also let me say that shitty games like the last call of duty sold 10 times more than ff13. same graphic, bad ps3 porting, a lot of bugs, short story, same gameplay. it sold more than gt5, god of war 3 and ff13.

          i agree with square. there are too many american macho likers and casual gamers.

      • Nier had a very good reception in Japan; the Replicant version was described as selling really well by the game’s director. The American audience also adopted the game into their lists of most influential and important titles of the generation. The majority of “professional” reviewers didn’t know what they were talking about, with one of them giving Nier a low grade because he couldn’t follow basic instructions provided by in-game text.

        The problem arises from the Gestalt version adding additional time and money to the development process, but failing to sell well. Some western gamers even refused to buy it on the grounds of the main character looking irredeemably ugly. The complaints weren’t so much about his older design as they were about a visibly lower rendering quality than on every other character.

        In other words, SquareEnix listened to the demands of a complete idiot from their marketing division in Los Angeles, disastrously mis-marketed the game to a wrong audience and then tried to save face by lying to people about the development process when the result failed to sell.

        I think that rather than making statements like these, they should make a public apology to Nier’s creator for violating his game and ruining its sales in the process.

        • The sad thing the people that made Nier their company went under because of what happened with the LA division. They fucked over the series by getting scared and over thinking for fans. By thinking for the fans before they even have a chance this is why I hate PR people in gaming these days because they’re overpaid bastards that are a cancer these days. It’s basically let get a quick buck, fuck quality because they’ll buy it anyway.

  • Good, please go bankrupt now.

    And yes I am aware profit =/= actual money made. Even if they didn’t make much profit, they still covered all their costs so they weren’t in the red, and being even a little in the green is still an ok sign.

    I, on the other hand, want them in the red.

  • Japan’s economy and many industries are failing…Sony for one the whole company going into a huge change where it is almost deemed as dooomed…SE another one…

    On the other hand their S.korea counterparts are thriving…Just look at Samsung…could never been better…

    Difference between Japan and S.korea… Improve and Innovate…

    The japs only know how to improve on existing ideas… Thats why you see FF series one after another… And they freaking bank in so much resources into one series, which inevitably would fail at some point (case of the recent PS3 FF and XIV)…Too little innovation to create something new…

    S.korea innovates alot thats why they are churning out so many MMORPGs over the years…They ae earning what japs are losing…

    Rmb improvement vs innovate…Thats as far as improvement is gonna bring you…

  • Their games aren’t that bad and there are many games far inferior which are strangely more popular at the moment.
    It’s just an anti-Square-Enix hype going through the gaming world lately. That periodically happens to stuff that was previously too popular.
    This’ll be over in a year or so…
    I wonder if I should buy their stocks now that they’re so cheap.