In a statement released yesterday, Square Enix shared that the company will incur an extraordinary loss in an efforts to “be more selective and focused in the allocation of development resources.” The company’s board of directors convened to review the company’s upcoming project pipeline and voted to incur a loss of a potential 22.1 billion yen (nearly $149 million US dollars as of this post) in the fiscal year ending 2024.
Recently, the company has partnered with external studios to deliver what seemed like a salvo of games belonging to franchises in its existing portfolio like Stranger of Paradise Final Fantasy Origin (Koei Tecmo) , Star Ocean The Divine Force (tri-Ace) along with new IP like Harvestella (Live Wire) and Triangle Strategy (Artdink).
Many of these titles came within rapid succession with varying degrees of fanfare and reception, and had smaller budgets and scope than the company’s AAA blockbusters. However, it seems that the newly-minted CEO Takashi Kiryu has had this on his slate for a while now: consolidating resources, and likely shuffling projects and teams, as he indicated in his letter at the start of this year:
“We are also working to put organizational structures in place that will enable closer collaboration between our content development and publishing functions. Our goal is to strike a balance between a product-oriented and a market-oriented approach so that we are able to share customer views with our content development team and thereby create content that makes our customers even happier than ever before.”
“Specifically, we have begun optimizing our resource allocation across our entire development chain in order to accelerate an effort that was already underway to strengthen our internal development capabilities. We are also expanding knowledge sharing with the goal of standardizing our processes and enhancing our efficiency.”
In assessing this loss, it suggests thats Square Enix has likely downsized upcoming projects in the HD games sector or may have been cancelled outright before they have been officially announced to the public.
It also suggests that projects will go through some sort of evaluation (or re-evaluation) in assessing how they will perform and if they are fit to do so. It should be noted that the HD games segment is different from the MMO (Final Fantasy XIV Online) and mobile areas (Final Fantasy VII Ever Crisis) , as indicated in its quarterly reports.
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