Square Enix Revises Earnings Forecasts For Major Loss

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Square Enix announced revised earnings expectations today. The company says that it will incur a net loss of 12,000 million yen for the previous fiscal year. Its previous forecast from February 3 listed a modest net profit of 1,000 million yen.

The revision is due to extraordinary losses, in part from a "tightened selection standard" for games. This will result in 4.5 billion yen in losses related to development cancellations. A press release announcing the revision did not share specifics beyond this.

The company will also incur a "loss on disaster" of approximately 0.6 billion yen related to the Tohoku earthquake. This is for closures and restoration of amusement facilities.

As these are all extraordinary losses, revisions to the company's forecasts for its other areas weren't as extreme. Sales forecasts are down from the original 130,000 million yen to 125,000 yen. Operating income expectations are down from the forecast 8,000 million yen to 7,300 million yen.

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Source:
http://www.andriasang.com/e/blog/2011/05/12/square_enix_earnings_revision/
link to official PDF :
http://www.square-enix.com/eng/news/pdf/110512.pdf

Could this mean trouble for XIV?

None of that made any sense to me so it would be rather presumptuous to infer disaster from it. But what I can say for sure is OMG THIS IS DA END OF DA WORLD RUN 4 UR LIVES!!11

DEY TOOK OUR JUBS

Well time to kill XIV so most of the trolls can migrate to the XI boards.

Aren't they having an "end of world" event coming up?

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Originally Posted by Bayohne

SOMETHING is coming!

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THE END IS NEAR!!!!

Well if they do decide to shut down XIV, just release a MMO modified version of FFXII and I will buy it on day one.

Actually... SquEnix kinda had this one coming, and it's really the producer's faults for the disasters of XIII and XIV in particular. Even worse, with the horrific reaction to XIII, they insist on TWO sequels for it and they made a Dissidia title FEATURING XIII characters. What SquEnix doesn't grasp so well is that FF Fan and Anime Fan as stereotypes don't cross contaminate as much as they hoped, and while the corn-ball anime jRPG that was XIII was ambitious in it's own rights, it was a FAILURE, and trying to promote it anymore is just insulting to those of us whom tried to like it, but just found it to be a FAILURE, and got over it. SE has lost a massive portion of it's demographic because it has abandoned us, much in the same fashion as CAPCOM's Inafune, and they could

a) Learn from the bad experience and try to leave it in the past as a mess that will be viewed as enjoyable in the ironic sense (like bad 80s action flicks)

or...

b) Promote the shit out of it in spite of the fan base having bad reactions to it. Most of us don't like playing a game that's a direct line with the 5 man band, an AI dependent battle system, and is only visually appealing if you think human beings are all poorly defined manikins whom ride motorcycles and have pointless drama (or hair which looks like roadkill dyed pink). The formula sucks, and if it never happens again, it's easy to overlook (especially if XIV is salvaged)

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Originally Posted by Augury

Actually... SquEnix kinda had this one coming, and it's really the producer's faults for the disasters of XIII and XIV in particular. Even worse, with the horrific reaction to XIII, they insist on TWO sequels for it and they made a Dissidia title FEATURING XIII characters. What SquEnix doesn't grasp so well is that FF Fan and Anime Fan as stereotypes don't cross contaminate as much as they hoped, and while the corn-ball anime jRPG that was XIII was ambitious in it's own rights, it was a FAILURE, and trying to promote it anymore is just insulting to those of us whom tried to like it, but just found it to be a FAILURE, and got over it. SE has lost a massive portion of it's demographic because it has abandoned us, much in the same fashion as CAPCOM's Inafune, and they could

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I was under the assumption that even though the majority of people disliked XIII, it was still a financial success. Besides, the other XIII games (Agito which is now Type-0, and Versus XIII) are not sequels, but merely based off the fabula nova engine. XIII-2 is likely proof enough that XIII turned a profit, no? And although I've not seen figures for the units sold/shipped for Dissidia, its a huge stretch to say they detracted players by including ONE character from XIII.

And I'm pretty sure that this article is not anything new. Didn't they revise their earnings for the last fiscal year shortly after XIV's release, noting they would take a major loss? Yoshi-P himself discussed this in a letter, saying XIV's near future is safe because SE independently funds this (maybe all?) project rather than seek investments externally.

EDIT: Here's some financial info pulled from wiki:

In March 2010, Square Enix stated that Final Fantasy XIII was the fastest-selling title in the franchise's history.By April of the same year, American game sales for the PlayStation 3 and Xbox 360 reached an estimated 800,000 and 500,000 units respectively. As of May 18, 2010, Final Fantasy XIII had shipped 5.5 million copies worldwide.

I wouldn't call that a failure :)

/care.Funny op, your first post it's a "SE trouble". You have a brilliant career in ffxiv forum

Yes, I was kind of hoping to hear what Bayohne or someone else from SE has to say.
Do we have reason more reason to worry about this game?
Now, do you have anything to add to the discussion or are you just trying to make an ass out of yourself?

I already did: /care

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Originally Posted by Vanas

Yes, I was kind of hoping to hear what Bayohne or someone else from SE has to say.
Do we have reason more reason to worry about this game?
Now, do you have anything to add to the discussion or are you just trying to make an ass out of yourself?

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Let's see, it's May 12th. That report detailed the revised earnings for Fiscal Year ending March 31st, 2010. It would seem from the report that they cut a few projects already prior to the end of said fiscal year to soften the losses.

Yoshida, as well as SE Reps such as Bayohne, have been keeping us updated as to the status of the game as well as things we have posted they might or are considering to add. Yoshida himself stated that they are funding this game entirely without investor funds and it will rise or fall on their shoulders without pressure from outside investors.

Do you liken the SE Forum Reps to the stewardess that knows the plane is going down but has the job of calming the passengers before the captain gets on the PA System to warn everyone to say their prayers? Do any of you honestly think the game is going to be cancelled and all these posts and Lodestone updates occur as part of an elaborate charade because they just don't have the heart to tell us?

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Do any of you honestly think the game is going to be cancelled and all these posts and Lodestone updates occur as part of an elaborate charade because they just don't have the heart to tell us?

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I'm not sure if the game is going to be canceled. The article says that they had previously predicted a profit of 1,000 million yen, but now they're predicting a 12,000 million loss?
Just looking at the numbers, it would seem like there might be some worry for XIV.
It's an honest question, no need to pull out the pitch forks.

This doesn't really mean much without seeing what *exactly* the losses are from.

Half of that loss could be on new infrastructures that would show a loss for that year, but make them 10x more over the next 15 years.

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Originally Posted by Vanas

I'm not sure if the game is going to be canceled. The article says that they had previously predicted a profit of 1,000 million yen, but now they're predicting a 12,000 million loss?
Just looking at the numbers, it would seem like there might be some worry for XIV.
It's an honest question, no need to pull out the pitch forks.

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What I am saying is that if the game was in danger they would know about it already, you don't spend money updating the game/forums/employing reps if the game is going down due to financial constraints. If they had in fact been holding out, their image would be far more tarnished than it has already become to some of it's player base. It's just not a logical move from a business standpoint.

This means nothing for FFXIV.

What it means is they cancled some games they had on the back burner to save money from their development so they can not list them as possible incomes in the future.

Forcasted income means they designed a game and forcasted that they would sell so many units of it based on features they proposed to release with the game. The problem stems that they decided to stop and look back at the quality of the games they were producing and some they were dissatisfied with. The quality of all game released reflects poorly on the company as a whole so they decided instead of trying to finish projects that have been deemed possible failures and just shoveling them out to try and make the money back on the software they are simply canceling the project and have to remove any forcasted income for that software.

This is most likely things like "My pony friend 3" I dont know why square decided it should release some of the games they did in 2009 and 2010, but I have a Pony friend 2 members code on my members account because I simply wanted the points. Got me into silver status for 2010 though.

In reality this information is probably a good thing because it means any project they have let remain active they have faith in performing at a phenomenal level. FFXIII was a financial success for them. a huge majority of the gaming press loved it. The few people who keep coming out screaming its not final fantasy and its not an rpg , and its not a good game are the same people who cry because Final Fantasy lasted longer then one game. They simply hate it because other people enjoy it.

The fact is FFXIII followed the recipe for Final Fantasy almost to the T. and FFXIII-2 will end up resolving the issues most people had. They already said they were taking the negative media against XIII to heart for its internal sequel. Again it'll probably sell at least another 3 million units and they didn't have the first time investment cost of creating the in game world and assets as a huge number of assets can simply be reused.

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Originally Posted by Vanas

I'm not sure if the game is going to be canceled. The article says that they had previously predicted a profit of 1,000 million yen, but now they're predicting a 12,000 million loss?
Just looking at the numbers, it would seem like there might be some worry for XIV.
It's an honest question, no need to pull out the pitch forks.

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I'm pretty sure that projection was before the Deus Ex release was pushed 6-odd months.

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Originally Posted by Grundy

I'm pretty sure that projection was before the Deus Ex release was pushed 6-odd months.

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It is
It most likely also doesn't include recent revelations about things like the projects for Hitman, Thief, and other Eidos IP's that are still being worked on. Dungeon Siege III soon as well.

Radaghast I really love your sig....

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Originally Posted by Cairdeas

The fact is FFXIII followed the recipe for Final Fantasy almost to the T. and FFXIII-2 will end up resolving the issues most people had. They already said they were taking the negative media against XIII to heart for its internal sequel. Again it'll probably sell at least another 3 million units and they didn't have the first time investment cost of creating the in game world and assets as a huge number of assets can simply be reused.

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I agree with this very much. Although FFXIII is probably my least favorite FF title, it really isn't that bad a game. Of all the PS3 games I bought in 2010, FFXIII is probably the only one I feel like playing again. And I will no doubt buy FFXIII-2, I will just use the money saved from FFXIV being free.

The only reason the Chrono Trigger series never got further then Cross was because of bad sales (http://www.rpgsite.net/news/342/squa...-buy-more.html). No doubt the FF series would have followed same destiny if they weren't succesful.

So, to say FFXIII is a MASSIVE FAILURE (which is often said) is just wrong.

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Originally Posted by Aizm

I was under the assumption that even though the majority of people disliked XIII, it was still a financial success. Besides, the other XIII games (Agito which is now Type-0, and Versus XIII) are not sequels, but merely based off the fabula nova engine. XIII-2 is likely proof enough that XIII turned a profit, no? And although I've not seen figures for the units sold/shipped for Dissidia, its a huge stretch to say they detracted players by including ONE character from XIII.

And I'm pretty sure that this article is not anything new. Didn't they revise their earnings for the last fiscal year shortly after XIV's release, noting they would take a major loss? Yoshi-P himself discussed this in a letter, saying XIV's near future is safe because SE independently funds this (maybe all?) project rather than seek investments externally.

EDIT: Here's some financial info pulled from wiki:

In March 2010, Square Enix stated that Final Fantasy XIII was the fastest-selling title in the franchise's history.By April of the same year, American game sales for the PlayStation 3 and Xbox 360 reached an estimated 800,000 and 500,000 units respectively. As of May 18, 2010, Final Fantasy XIII had shipped 5.5 million copies worldwide.

I wouldn't call that a failure :)

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I also don't know why so many people call ffxiii a failure... but many do and the numbers are extremly high, as far as i know ffxiii was one of the biggest success they had in the ff-series....
- i liked ffxiii tbh, wasnt the best game i played but i had fun -

Its like people saying ffxi wasnt successful.

This is so unrelated to FFXIV it's actually a little funny.

@FFXIII:

It sold well, on both ends of the globe, and no one can say "we didn't know the game was bad!" or whatever excuse can be given, as the game was released 3-4 months in Japan before the western release and there were tons of Jtv streams, youtube playthroughs and importer reviews and despite those, it still sold well.

Square also said recently that Chrono series would return and were testing the waters with the DS remake.

@Anty

People DO says XI wasn't successful, they also say XI was a failure and a horrible MMORPG, yet I guarantee they played the games XI alone funded.

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Originally Posted by Anty

I also don't know why so many people call ffxiii a failure... but many do and the numbers are extremly high, as far as i know ffxiii was one of the biggest success they had in the ff-series....
- i liked ffxiii tbh, wasnt the best game i played but i had fun -

Its like people saying ffxi wasnt successful.

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Indeed.

It's astounding how so many people can confuse numerical facts with shallow opinions.

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Originally Posted by Jennestia

This is so unrelated to FFXIV it's actually a little funny.

@FFXIII:

It sold well, on both ends of the globe, and no one can say "we didn't know the game was bad!" or whatever excuse can be given, as the game was released 3-4 months in Japan before the western release and there were tons of Jtv streams, youtube playthroughs and importer reviews and despite those, it still sold well.

Square also said recently that Chrono series would return and were testing the waters with the DS remake.

@Anty

People DO says XI wasn't successful, they also say XI was a failure and a horrible MMORPG, yet I guarantee they played the games XI alone funded.

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i think it was (wow excluded) one of the most successful mmos out there, considering how long it is on the market and that for many years the subscriptions increased year by year. The only other mmo that managed to do so was/and is EVE online,
but most other games (wow excluded) didnt manage that. Im not sure how it is today, my numbers are from 2010 i think but that doesnt change the facts in that matter.

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Originally Posted by Jennestia

This is so unrelated to FFXIV it's actually a little funny.

@FFXIII:

It sold well, on both ends of the globe, and no one can say "we didn't know the game was bad!" or whatever excuse can be given, as the game was released 3-4 months in Japan before the western release and there were tons of Jtv streams, youtube playthroughs and importer reviews and despite those, it still sold well.

Square also said recently that Chrono series would return and were testing the waters with the DS remake.

@Anty

People DO says XI wasn't successful, they also say XI was a failure and a horrible MMORPG, yet I guarantee they played the games XI alone funded.

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oh sorry, im no native speaker, i wanted to point out that its silly how many people call ffxi unsuccesseful... well my bad

Its funny to see the forum hens squawking in defense of this game and attacking a guy who made a perfectly legitimate post meant to bring forth queries rather then slander.

This debacle has cost tens of millions to produce. It's been free to play for over 7 months costing them substantial losses in wages, server fees, etc etc. If any of you think this monstrous FUBAR of a game will turn around for before a year or more you're out of your minds. Does this mean I nessisarily think its going to be thrown into a dumpter? No, but thinking it won't be - or its impossible - for it to be touched by their bad financial year (and saying bad it putting it kindly) remind me how laughably blind and defensive people are in all things referencing this game.

The guy brought to light a very valid and concerning situation to this already belligerent game. He gets greeted by digital pitchforks and torches.

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Originally Posted by Vackashken

The guy brought to light a very valid and concerning situation to this already belligerent game. He gets greeted by digital pitchforks and torches.

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People also said the first time someone posted financial information without being properly informed was that XIV's release was why they adjusted it.

Protip: Every JP studio directly or indirectly affected by the earthquake and tsunami had a loss and readjusted their forecasts as well.

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If any of you think this monstrous FUBAR of a game will turn around for before a year or more you're out of your minds.

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I think this is something you created, as most people who aren't overly pessimistic agree it will take a long time for XIV to finish it's redesign, whereas others feel it should be finished in weeks if not 1 month or "SE is too slow."

Actually to be honest the Posted losses are probably a result of PSN being down as SE has TONS of content on PSN that you can not use or download with PSN being down.

DOOOOOOOOOOOOOOOOOOOOOOOOOOM!

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Originally Posted by Cairdeas

Actually to be honest the Posted losses are probably a result of PSN being down as SE has TONS of content on PSN that you can not use or download with PSN being down.

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yeah.. i have the promotional codes of ffi and ii waiting to be used

To close FFXIV would be like to turn around a knife in the belly. It still may be = monthly fee +, but due PS3+Sony crisis and stuff with the hacking scum (I wonder why they need to destroy other corps). Ya, ya.. No one knows.

Means nothing for FFXIV. With the combination of the earthquake/tsunami and PSN being down as well as the delays from said issues, it affects every JP dev studio and not just SE. Someone posted the first forecast they changed sometime last year and said XIV would be dead by January.

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Originally Posted by Anty

i think it was (wow excluded) one of the most successful mmos out there, considering how long it is on the market and that for many years the subscriptions increased year by year. The only other mmo that managed to do so was/and is EVE online,
but most other games (wow excluded) didnt manage that. Im not sure how it is today, my numbers are from 2010 i think but that doesnt change the facts in that matter.

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Eq/Eq2 said hi

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Originally Posted by Ostia

Eq/Eq2 said hi

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EQ did not maintain a positive influx of new players as long as FFXI did.

They have also said they are cancelling some games but won't say what, now would be a good time to reassure people the PS3 FF XIV is still going to happen. They never talk about it.

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Originally Posted by Ostia

Eq/Eq2 said hi

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there was a reason for EQ to got he F2P + P2P way. And like Cairdeas said, the numbers were not half as constant as ffxi had.
I think they had a time outstanding the ffxi subscriptions but that dindt last very long. FFXI playerbase increased many years.

The only thing that would kill FFXIV is a disastrous PS3 launch and I can't see that happening. With a large influx of players at PS3 launch I can see many PC players giving the game another try. If SE can push out an expansion at that time with Ishgard, a few more regions, new jobs, chocobos and airships that will get people excited even more. I wouldn't be surprised if the PS3 version is released by Christmas.

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Originally Posted by Vackashken

The guy brought to light a very valid and concerning situation to this already belligerent game. He gets greeted by digital pitchforks and torches.

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It's not a valid or legitimate concern unless people are trained in finance. If you have no financial background then you have no real insight into what a financial report actually says.

Let alone the fact that the article STATES as plain as day that the forecast had to be adjusted due to the earthquake means that the forecasted loss has little to do with SE's financial future and NOTHING directly to do with FFXIV at all.

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Originally Posted by Anty

there was a reason for EQ to got he F2P + P2P way. And like Cairdeas said, the numbers were not half as constant as ffxi had.
I think they had a time outstanding the ffxi subscriptions but that dindt last very long. FFXI playerbase increased many years.

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Yeah, because the game is so ancient that they aren't charging people for the old content as a way to garner more population and then charge them when they run out of stuff to do and have to get the newer content. Has nothing to do with the current or future model for MMO gaming.