Square Enix Posts Six Billion Yen Operating Loss, Blames North America and Europe
Square Enix has had a difficult fiscal year, as evidenced by its fiscal year 2013 financial reports. We expected that the financial statements would be covered in red ink, but things are a bit worse than anticipated.
For the year ending March 31, 2013, Square Enix posted an operating loss of 6.081 billion yen ($59.8 million). Additionally, the company reported a decrease in net cash from operating activities amounting to 98.4 percent. Square Enix has pinned the cause for the significant losses on "underperformance of major titles for consumer game consoles in North America and Europe."
As we previously reported, Square Enix had extremely aggressive (to the point of being unreasonable) expectations for sales of Tomb Raider, Sleeping Dogs, and Hitman: Absolution. As a result of the company's financial status, it laid off staff in Los Angeles and Europe. Company president Yoichi Wada also stepped down.
In an effort to right the ship, Square Enix will be focusing more on mobile (though hopefully with better results than Final Fantasy: All the Bravest), and approaching development from a regional perspective.
The financial notes also indicate that Square Enix is in need of better staffing, stating, "In order to achieve the Group’s medium- to long-term strategy, it is imperative to expand its global business and meet customers’ diverse content needs. To do so, it is critically important that the Group acquires and develops ideally suited human resources."