Square Enix planning focus on "quality over quantity" and multi-platform releases, laying off staff

In Square Enix’s report analyzing the previous fiscal year and the one upcoming, the company lays out their strategy for the next three years, and it includes several notable shifts.

In examining the last year, the release of titles in its High Definition portfolio like Final Fantasy XVI, Final Fantasy Pixel Remaster, Dragon Quest Monsters The Dark Prince, and Final Fantasy VII Rebirth compared favorably to the previous year, but collectively didn’t hit the profitability goals the company was looking for. This assessment doesn’t lay the blame at the feet of any particular title, but its AAA offerings not selling up to the company’s highest expectations and a salvo of smaller budget games failing to make splash, it’s not hard to see why the HD sector is a major target in the company’s medium-term plan. The company cites increased development costs and the content valuation losses for a larger operating loss.

The company also identified a slowdown in its SD sector – a classification for their smartphone and web browser offerings like Final Fantasy VII Ever Crisis and Final Fantasy Brave Exvius. In the last year alone, the company has sunset many of its gacha-style games like NieR Reincarnation, Dragon Quest Tact, and Final Fantasy VII The First Soldier. The MMO segment which includes games like Final Fantasy XIV and Dragon Quest X saw decline in the last year, and typically rises and falls with the release of a FFXIV expansion, which will arrive next month in the new fiscal year.

“Square Enix Reboots and Awakens – 3-years of Foundation Laying for Long-term Growth” is the title of the pitch, a four part plan the company hopes will improve the performance of these sectors. The first part of this plan will include a shift to a “quality over quantity” approach with its HD games, seeking to balance what its creatives and customers desire, and to launch games in its major franchises with a regular cadence.

The second is to develop HD titles Square Enix is known for, in an effort to build upon existing fanbases and potentially attracting new fans. For smartphone titles, the company wants to be more selective in which titles they’ll move forward, titles that will “leverage its rich library of IP”.

Square Enix will also be shifting away from using its business units with their own individual structure for a more integrated approach based on projects, a move they hope will lead bring more capability in-house and improve how they invest in and manage titles.

Specifically cited is the shift to a multi-platform strategy for AAA titles, “build a environment where more customers can enjoy our titles,” name dropping Nintendo platforms, PlayStation, Xbox, and PC. Square Enix wants to step up digital sales of its games, as a potential inroad for gaining traction among PC players, among other initiatives. Titles like FFXVI and FFVII Rebirth were platform exclusive at launch, and it seems like the new plan will shake up this tack.

Update: according to a report from VGC, Square Enix CEO and president Takashi Kiryu held an all-hands meeting today in which he announced that layoffs will occur over the next month at US and EU locations, particularly in the publishing, IT, and marketing. Some layoffs have already transpired, but it’s not yet known how many positions are impacted.

Also affected is the company’s SQEX Collective publishing unit, responsible for working with partners for titles like Little Goody Two Shoes and PowerWash Simulator. In the letter above, Kiryu states “the Group has begun optimizing costs at its European and American offices via structural reforms. It will also promote intra-Group collaboration in Japan and abroad and strengthen the functions of its London development site.”

About the Author

Tony Garsow Tony joined Nova Crystallis in 2015, and has spent more than a decade writing in the Final Fantasy community. He also contributes to the Nova Crystallis Twitch and YouTube channels, where you can watch select gameplay highlights, previews, and streams.