Square Enix Reports 14% Increase in Q1 Sales

Square Enix has released its quarterly financial results for the period ending June 30, 2023, with key highlights including: - Net sales of ¥85.6 billion ($602 million), representing a 14% year-over-year increase - A net profit of ¥6.3 billion ($44.3 million), down 66% from the previous year - Digital Entertainment segment net sales of ¥62.3 billion ($438 million), up 16% year-over-year - Amusement segment net sales of ¥13.3 billion ($93.5 million), up 10% year-over-year The company's Digital Entertainment division, comprising HD Games, MMO, and mobile/PC browser sub-segments, saw the HD Games subsection generate ¥29 billion ($204 million) in net sales, a 142% increase from the previous year. This revenue growth was attributed to the release of new Final Fantasy games, including Final Fantasy Pixel Master. However, the highly anticipated Final Fantasy 16, which launched on June 22, failed to meet sales expectations, with president Takashi Kiryu citing the slow adoption of Sony's PlayStation 5 console as a contributing factor. As of June 29, Final Fantasy 16 had sold three million copies. In contrast, mobile/PC browser games saw a decline in revenue, with ¥22.3 billion ($157 million) in net sales, representing an 18% year-over-year decrease. The segment's performance was impacted by the lack of major releases, with only the launch of free-to-play Dragon Quest Champions. Square Enix's MMO segment also experienced a decline in revenue, with ¥11 billion ($77.3 million) in net sales, a 22% decrease from the previous year. This was largely due to decreased sales of Final Fantasy 14 and Dragon Quest 10. Despite these mixed results, the company reported a 76% year-over-year increase in game copies sold, with 7.54 million copies sold across its portfolio during Q1 FY2024. Looking ahead, Square Enix forecasts net sales of ¥360 billion ($2.5 billion) for the fiscal year ending in March 2024, a 4.9% rise year-on-year. The company has a strong release pipeline, with upcoming titles including Dragon Quest Infinity Strash, Star Ocean The Second Story R, and Dragon Quest Monsters: The Dark Prince. Additionally, Final Fantasy 7 Rebirth is planned for an early 2024 launch, and Final Fantasy 14 is set to come to Xbox in Spring 2024, with a new expansion pack, Dawntrail, scheduled for release in the summer of 2024.