Square Enix Loses Nearly $2 Billion in Value Since Final Fantasy 16

https://www.ign.com/articles/square-...nal-fantasy-16

Uh oh.
I guess that's the definitive word on the debated success of FFXVI.

Hopefully Kiryu's fondness for FFXIV means it will be a significant part of their described pivot towards focusing on their bigger games.

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The root of the problem, sources told Bloomberg, is that producers were given “full reign” over the scope and direction of projects, whose goals can shift “without warning”. The upshot of this is volatility in the quality of the final product.

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This is probably mostly referring to things like Balan Wonderworld, Forespoken and Marvel's Avengers, but is still.. interesting to say the least.

Didn't they brag having 50% of unused maps for FFXIII?

They changed a lot about FFXV.

Changing a lot about a game in development and throwing away (completed) work has been an issue of SE for a long time.

Thought about posting this earlier, but figured I'd wait for someone else to do it as I didn't feel like writing an intro lol.

Seems like XIV is one of their few products not losing them money these days. I guess we'll see how 7Remake-Part 2 turns out. They really need a big win financially after the past few years outside EW.

TF2 mercs say it best.

14 carries the company so it will never get canceled dont worry bud

Having to wait until 2024 to be able to possibly buy FF XVI isn't helping it as they do have that 6 month exclusivity for the PS5 and I dunno how long it'll take them to actually make a port of it...

https://archive.ph/20230913031124/ht...n-market-value

“Square Enix has problems with their games output,” said Serkan Toto, a Tokyo-based industry consultant, who said too many of the company’s games are “kind of conventional” and don’t aspire to become blockbusters. “These titles get a 70% rating on Metacritic, are kind of OK and are just very forgettable.”

I wonder...

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Originally Posted by CaptainLagbeard

Having to wait until 2024 to be able to possibly buy FF XVI isn't helping it as they do have that 6 month exclusivity for the PS5 and I dunno how long it'll take them to actually make a port of it...

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It's pure copium to think the PC port will help matters. FF16 is an extremely mediocre game in the sea of great games that released lately like BG3.

Of course, many people will disagree and claim that FF16 is awesome. But neutral, logically-minded analysts have this to say:

The company has begun overhauling how it assigns producers, one of the contractors said. While game quality management remains a risk, the studio can bank on its legacy franchises for the time being, according to MST Financial analyst David Gibson. Square Enix has a loyal following of fans for its established titles and it can keep churning those out across new platforms to maintain sales for a while, Gibson said.

That's right: SE churns out mediocre or even garbage quality games and bank on its charmed and enraptured loyal fanbase to carry them over. It's much like Pokemon: garbage after garbage but it does fine because its fans hate themselves and dare not question their god.

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Originally Posted by GaiaBell

14 carries the company so it will never get canceled dont worry bud

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Honestly with the lack of attention it had recently, and how people will blame FFXVI relative failure (if it's really one, I have no opinion on that, but from that article, it seems at least disappointing) on Yoshida, the game might not be cancelled, but I would not be surprised if it suffered big changes, and maybe not for the better. SE is not known for his strategic choices, and the president coming from the strategic division, I have a lot of doubts on his capacity to deal with the problem. SE is the Capcom from 15 years ago.

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Originally Posted by CaptainLagbeard

Having to wait until 2024 to be able to possibly buy FF XVI isn't helping it as they do have that 6 month exclusivity for the PS5 and I dunno how long it'll take them to actually make a port of it...

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That too. This was probably their worst mistake. FFXIV players were probably the most easy player to convert into FFXVI sales, and despite FFXIV being mainly played on PC outside Japan, they chose to cut that part of the playerbase. Now that the reception is out and opinion on the game are divided, I'm not sure the sales on PC will be as high as they would have if it was a simultaneous or a one month separated release. The window of intersest is closed, and the FFXVI pc Sales will probably follow those of XV, serve as the platform for long time sales of the game, but I doubt there will be any big peak.

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Originally Posted by CaptainLagbeard

Having to wait until 2024 to be able to possibly buy FF XVI isn't helping it as they do have that 6 month exclusivity for the PS5 and I dunno how long it'll take them to actually make a port of it...

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They've started making the port now and it'll come with the DLC. WHEN it will come out, we don't know.

Now we know why they never take any risks with FF14. If they accidentally made a bad call and had a catastrophic patch or two, it'd probably take the whole company down with it.

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Originally Posted by CNitsah

Honestly with the lack of attention it had recently, and how people will blame FFXVI relative failure (if it's really one, I have no opinion on that, but from that article, that kinda seems the case) on Yoshida, the game might not be cancelled, but I would not be surprised if it suffered big changes, and maybe not for the better. SE is not known for his strategic choices, and the president coming from the strategic division, I have a lot of doubts on his capacity to deal with the problem. SE is the Capcom from 15 years ago.

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The article did not say FF16 is a failure, it said FF16 failed to cover for other failures.

What this means is that FF16 is a 'meh', but SE cannot be affording to making anymore 'meh's. They need a 'wow' (and not in the Forspoken way where the 'wow' is 'wow this is garbage').

I highly doubt Dawntrail will be a 'wow'. One can only hope that the suits at SE realize that their games need to break the formula and aim to be masterpieces instead of being mediocre, rehashed, and safe.

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Originally Posted by Rolder50

Now we know why they never take any risks with FF14. If they accidentally made a bad call and had a catastrophic patch or two, it'd probably take the whole company down with it.

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The lack of taking risks is what's going to kill FF14 eventually. They cannot afford to make another 'meh' expansion.

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Originally Posted by CNitsah

Honestly with the lack of attention it had recently, and how people will blame FFXVI relative failure (if it's really one, I have no opinion on that, but from that article, that kinda seems the case) on Yoshida, the game might not be cancelled, but I would not be surprised if it suffered big changes, and maybe not for the better. SE is not known for his strategic choices, and the president coming from the strategic division, I have a lot of doubts on his capacity to deal with the problem. SE is the Capcom from 15 years ago.

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His presence at fanfest was ghoulish. Legitimately got a sinking dread feeling the longer he was there.

Ive read that a big factor in this is how badly ps5 sales have been going. One figure i read stated that there was an estimated of 30% of ps5s which have never been turned on which means tons are still sitting with scalpers refusing to sell them for a loss.

This looks to me that this is a myriad of issues with both playstation as well as square. Square def has its own issues, theyre trying to recover from how bad that terrible marvel game flopped.

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Originally Posted by CaptainLagbeard

Having to wait until 2024 to be able to possibly buy FF XVI isn't helping it as they do have that 6 month exclusivity for the PS5 and I dunno how long it'll take them to actually make a port of it...

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god this only fuels my hatred of exclusives even more

playstation trying real hard with them to get me to buy a ps5 but im not going to do that, sorry

Yeah... dont think SE has much to worry or its investors, even with FFXIV shortcomings as of late, there just really isnt heavy competition with MMOs anymore and prolly wont be for a long while. SE still has its usual ace with FFVII and Rebirth will certainly make them bank. Im curious if future will forever just stick to its usual series of games or try again at new games, guess we'll see...

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Originally Posted by Noumenon

It's pure copium to think the PC port will help matters.

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It's obviously not gonna be selling like billions of copies or anything, but I would imagine that a very large percentage of FF 14 players' are on PC and not on the PS5.

So there is more likely than not a lot of people who play FF XIV, and want to play XVI but do not have a PS5 so they currently can't. And when they finally can, then you can go and declare it to be a failure if it is.

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Originally Posted by Ivtrix

god this only fuels my hatred of exclusives even more

playstation trying real hard with them to get me to buy a ps5 but im not going to do that, sorry

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FF XVI would probably be currently the only reason to buy a PS5... And it alone definitely would not be worth the money.

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Originally Posted by CaptainLagbeard

It's obviously not gonna be selling like billions of copies or anything, but I would imagine that a very large percentage of FF 14 players' are on PC and not on the PS5.

So there is more likely than not a lot of people who play FF XIV, and want to play XVI but do not have a PS5 so they currently can't. And when they finally can, then you can go and declare it to be a failure if it is.

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I think PS5 FF16 benefited from releasing before BG3. A lot of PC RPG players will probably be playing that or will have that to compare FF16 to when they get around to it, and regrettably FF16 just doesn't really hold up in comparison. Any hype for 16 pretty rapidly diminished - I don't think it's really getting any 9 or 10 out of 10 word of mouth any more.

SE is an Uroboros, a constant cycle of failure and rebirth that goes something like this:
>Celebrity status fool makes a big, expensive vanity project.
>Project causes financial disarray.
>Employee has an idea that saves the company.
>Previous celebrity employee gets pushed to the background to lead projects of varying quality.
>Savior employee gets surrounded by Yes Men and given free reign within the company, elevating him to celebrity status.
>Celebrity status fool makes a big, expensive vanity project...

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Originally Posted by CaptainLagbeard

FF XVI would probably be currently the only reason to buy a PS5... And it alone definitely would not be worth the money.

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thats how i feel and thats why i havnt bought a ps5

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Originally Posted by Ivtrix

thats how i feel and thats why i havnt bought a ps5

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I got a PS5 but so far exclusive-wise it's getting very little use. I mostly got one because I like to relax and sometimes play a game from my bed before I fall asleep, and don't always want to sit at my PC since I already work from home. I'll mostly play multi-plat action games on my PS5 like Hogwarts, Elden Ring, and I have Mortal Kombat 1 coming tomorrow. For me it's enough of a reason to have one, but these games can all be played on PC so FF16 is my only exclusive...and no, I would not buy a console for just that.

Problem is and I agree a lot of this is them suffering from recent mismanagement with avengers and forspoken heck even 7 remake wasn't a smooth process. I think they really need to dial in what their communities want and really try to cater to it and this goes outside of 14...they have just launched so many mobile games that cost money and dump them and forspoken could of been good if they actually researched their target audiences and what direction to go in. They have 7 remake part 2, dawntrail next year at a minimum...hopefully Dragon Quest 3 remake. They've also got KH4 on the way at some point, they just need to nail these releases and I think it will speak volumes. This year was a hard year competition wise for products released. Only time will tell I guess :P

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Originally Posted by Noumenon

The lack of taking risks is what's going to kill FF14 eventually. They cannot afford to make another 'meh' expansion.

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They've taken risks. They have changed their timeframe for patches, whats in the patches (trials are MSQ now it seems) no exploratory zone, relic weapons are obtained via tomestones, criterion dungeons, the Island Sancturary etc. I feel like taking risks hasnt worked out great and they should stick to the patch 2.0-5.x formula.

I don't know whether FFXVI is good or not as I haven't played it, but being exclusive to PS5 probably didn't do them any favors. I'd have bought it already if it were on PC.

XI expansion incoming......When SE hits a FF crisis, they go back to the G.O.A.T.

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Originally Posted by Noumenon

It's pure copium to think the PC port will help matters. FF16 is an extremely mediocre game in the sea of great games that released lately like BG3.

Of course, many people will disagree and claim that FF16 is awesome. But neutral, logically-minded analysts have this to say:

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As it's been stated BG3 is one of those generational games that will define a genre for possibly a decade. It's final fantasy 7, or WoW one of those games that every game's going to get compared to and fall short. Now will a PC Port help final fantasy 16 I mean sure it'll sell more same with the Xbox port, and though not having this 6 months exclusive would probably make more money at least it's long enough that hopefully people will be taking a break from BG3. The article never says 16 was a loss just that other games lost so much that 16 couldnt recuperate it. When he's talking about churning known IPS cross platform is probably mostly referring to 16 coming to PC and Xbox and 14 coming to Xbox and I'm sure they're expecting a decent sales from both

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Originally Posted by GaiaBell

14 carries the company so it will never get canceled dont worry bud

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You mean WoW players....but they gone......

......That is why these XIV sales and free logins have been happening more frequently.

It didn't help that Yoshi isolated 84% of the worlds' populace.....probably should not have said anything.....He talks too much tbh.

-Go play other games
-Cross glamour breaks immersion
-People yell too much

Ya'll get the picture.....

Don't worry, Foamstars will save Square Enix. ;)

On a more serious note, I'd like to see them prioritise their bigger titles and release more remasters/remakes of older games without any of the usual 'updated for modern audiences' stuff.

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Originally Posted by Theodric

Don't worry, Foamstars will save Square Enix. ;)

On a more serious note, I'd like to see them prioritise their bigger titles and release more remasters/remakes of older games without any of the usual 'updated for modern audiences' stuff.

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I think they can see the success of Pixel remaster, Octopath and hopefully Dragon Quest 3 remake and go 'we can make more that scale, cheaper to make, make smaller profits off them'

Forgot about Foamstars...don't remind me :P I wonder when 6.5 comes out the Xbox players become part of the free trial via open beta. Wonder what that will do in the long run to the metrics.

Given Kiryu's strategy brace yourselves for XIV becoming even more averse to risks. And the next mainline FF to be even more by the books, streamlined and anti-freedom than XVI was.

I'm sad by the news. I actually like SE's smaller non-mobile games. The teams of their lower budget projects actually try to be creative and show passion. Their AAA projects have been style over substance hot trash for over a decade. Very unfortunate they will double down on that.

isn't the guy a huge nft shill too? better brace for those as well lol.

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Originally Posted by ZephyrMenodora

Thought about posting this earlier, but figured I'd wait for someone else to do it as I didn't feel like writing an intro lol.

Seems like XIV is one of their few products not losing them money these days. I guess we'll see how 7Remake-Part 2 turns out. They really need a big win financially after the past few years outside EW.

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The reason we don't get good QOL updates / server updates / fixed code is because all of that is expensive and FF14 is being used to funnel money into other projects that largely underwhelm / fail.

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Originally Posted by GaiaBell

14 carries the company so it will never get canceled dont worry bud

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How do you reckon? It's around 15% of their total revenue - 17% in a good year - and that's the MMO subdivision as a whole. It's not insubstantial, and of course it's not the profit (they don't break this down but provide it at division-level), but... seems like a bit of an exaggeration to say it carries the company to me.

https://i.imgur.com/MDFvAn8.png

https://i.imgur.com/oqmBrVb.png

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Originally Posted by Lauront

How do you reckon? It's around 15% of their total revenue - 17% in a good year - and that's the MMO subdivision as a whole. It's not insubstantial, and of course it's not the profit (they don't break this down but provide it at division-level), but... seems like a bit of an exaggeration to say it carries the company to me.

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I think it's the profit issue you hinted at. I think the HD games division often loses money and runs red - and I don't think the MMO division spends as much money on re-investing in the MMOs and it gets diverted. It seems though that a lot of their profit probably comes from churning out pointless mobile games. New-gen HD games are a lot more expensive to produce than our MMO content or a basic mobile gacha game.

This is a trend I have seen in many financials (MMO financials are a weird hobby of mine), which is pretty sad.

Edit: Some of the info about their HD games losing them money is more found in interviews about their HD games, rather than broken down clearly in their financials.

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Originally Posted by Mcg55ss

The thing is the image you keep reposting is just net sales... How many people bought the game, that doesn't say how many people are paying subs or buying multiple retainers and so on even the article states that sales will probably main low until the next expansion.

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Pretty sure the subs and miscellaneous cash shop/retainer subs are included in the revenue numbers for the MMO division.

Another clickbait created by the industry of fear... looks like this stuff will never die
The market has a hype period too...look for bear & bull market.

Basically, in gaming industry, every pre release is a bull market and post release is a bear market.
You can find the same happening with R* when they released GTA V and The Witcher 3 for CDPR. It's weird but it's how things works.
After a while, the company tends to gain value and be profitable again, specially when they announce new projects. SE will recover next year.

Even with such loss, SE is more valuable now than 2015 and 2020 in terms of stock market.

Stop this no sense already. Associate this value with FFXVI is even more dishonesty.


https://i.imgur.com/mPc9bXZ.png

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Originally Posted by Lauront

How do you reckon? It's around 15% of their total revenue - 17% in a good year - and that's the MMO subdivision as a whole. It's not insubstantial, and of course it's not the profit (they don't break this down but provide it at division-level), but... seems like a bit of an exaggeration to say it carries the company to me.

https://i.imgur.com/MDFvAn8.png

https://i.imgur.com/oqmBrVb.png

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The thing is the image you keep reposting is just net sales... How many people bought the game, that doesn't say how many people are paying subs or buying multiple retainers and so on even the article states that sales will probably main low until the next expansion.

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Originally Posted by ZephyrMenodora

I think it's the profit issue you hinted at. I think the HD games division often loses money and runs red - and I don't think the MMO division spends as much money on re-investing in the MMOs and it gets diverted. It seems though that a lot of their profit probably comes from churning out pointless mobile games. New-gen HD games are a lot more expensive to produce than our MMO content or a basic mobile gacha game.

This is a trend I have seen in many financials (MMO financials are a weird hobby of mine), which is pretty sad.

Edit: Some of the info about their HD games losing them money is more found in interviews about their HD games, rather than broken down clearly in their financials.



Pretty sure the subs and miscellaneous cash shop/retainer subs are included in the revenue numbers for the MMO division.

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I'd be willing to wager it has a better profit ratio than some of their other subdivisions because they try spend as little as they can on it and generate revenue from low effort Mogstation rubbish, like the Ysayle outfit, it's just the whole 'carries' thing which I've always found a bit silly.

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Originally Posted by CStrife912

I think they can see the success of Pixel remaster, Octopath and hopefully Dragon Quest 3 remake and go 'we can make more that scale, cheaper to make, make smaller profits off them'

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You'd think, but then...

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A new report from Bloomberg painted a bleak picture of Square Enix, which reported a sharp profit decline in August. Analysts told the publication that Final Fantasy 16 failed to make up for the poor performance of previous Square Enix flops, such as Marvel’s Avengers and Forspoken, and mobile games that were shut down soon after launch.

The root of the problem, sources told Bloomberg, is that producers were given “full reign” over the scope and direction of projects, whose goals can shift “without warning”. The upshot of this is volatility in the quality of the final product.

Square Enix has a new CEO, Takashi Kiryu, who intends to reduce the number of smaller games in the works to focus on big-budget games that have a greater chance of making an impact on the company’s bottom line. Square Enix declined to comment.

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And from their most recent accounts:

https://i.imgur.com/QfUY4Jm.png

https://i.imgur.com/X9dGyzr.png

Dunno, their current strategy, between what's in the article and the financial results, just seems like more of the same.

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Originally Posted by Mcg55ss

The thing is the image you keep reposting is just net sales... How many people bought the game, that doesn't say how many people are paying subs or buying multiple retainers and so on even the article states that sales will probably main low until the next expansion.

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This is the first time I've posted those images in this connection. Why do you think sales would exclude subscriptions or multiple retainers, as if these aren't sales? These are their financial accounts presenting all their sources of revenue from their IPs, so where do you think they're hiding the subscription income if not reporting it in their accounts?

In fact here's this from their September 2022 results briefing:

https://i.imgur.com/OqS2vY4.png

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Originally Posted by Deceptus

The reason we don't get good QOL updates / server updates / fixed code is because all of that is expensive and FF14 is being used to funnel money into other projects that largely underwhelm / fail.

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Didn't they just upgrade the servers last month?

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Originally Posted by CidHeiral

Didn't they just upgrade the servers last month?

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People don't see something like that, rather because the game haven't added the next QoL they want, it means the dev don't reinvest. It's the sort of self-made belief that becomes truth simply because enough people repeat it enough of time. The serve upgrade wasn't even the biggest deal in the last couple years. The server expansion that happened during COVID when hardware cost were 4-5 times above the market price were completely bonker. I won't guess where that money coming from, I just gonna guess it have to come from ... somewhere?

Sorry but stocks value go up and down all the time. What matters is their actual finances and sales.