Square Enix Shelved More Than $140 Million In Games

The last several years have seen a deluge of video games from Square Enix, many of which have been launched in quick succession and fall within their Double-A tier, titles such as Star Ocean: The Divine Force, Strangers of Paradise: Final Fantasy Origin, VALKYRIE ELYSIUM, Voice of Cards, Triangle Strategy, Star Ocean, etc. Occasionally, numerous titles would be released in rapid succession; some of these titles would go on to become fan favorites; although many of them have been critically and financially disappointing. The new CEO, Takashi Kiryu, has acknowledged the problem and is working to resolve it.

Despite Square Enix's prolific output, many of their games fail to garner significant attention. In the end, many of these games wind up being just like Forspoken or Foamstars, releases that everyone can predict will bomb at launch but are nevertheless sent on extinction. Yesterday Square Enix published a statement on their Recognition of Extraordinary Losses, while at first glance, seemed negative; I can see that there will be some negative aspects to it. I believe this might transform a lot of bad decisions taken by Square Enix into good decisions for their future games. The new CEO is not going to follow in Yosuke Matsuda's footsteps, which is encouraging news in my book.

 

According to the announcement made by Square Enix, the company would be suffering a loss of 140 million dollars due to the content that has been abandoned. Put simply, a batch of video games valued at 22 billion yen was just canceled and game development for both PC and consoles is encompassed under this. This means these games are not mobile games or massively multiplayer online affairs, but rather HD games. Thus, many games have been postponed or canceled, and it is quite unlikely that we will ever find out which ones unless the news has already been announced.

To be fair, it's a shame this happened because I imagine there are a lot of games that we would have liked to play among that $140 million in losses. However, there are likely a few games in there that no one was interested in playing. Regrettably, this also implies that several of Square Enix's most fantastic titles from that era, like NEO: The World Ends with You, will likely not see a sequel. That sentence makes me heartbroken since few of my associates would want the series to keep going. Regrettably, for every delightful surprise like NEO, a multitude of unremarkable titles were launched. However, unlike Triple-A games, the development budgets for these Doublle-A games are far lower. Quite a few of them are still failing to generate enough revenue to support their continued existence. Consider the popularity of Stranger of Paradise: Final Fantasy Origin among Final Fantasy enthusiasts.

Be that as it may, that game did not do very well in the marketplace. With only 46,000 physical copies sold in its first week, it had the fourth-lowest launch for a Final Fantasy spinoff in Japan. At least that game was well-received by its audience. Game titles such as Forspoken, Foamstars, Babylon's Fall, and Chocobo GP not only received mixed or even unfavorable reviews. Honestly, most of those games weren't even fan favorites. Unfortunately, this is happening at the same time that Square Enix has been a major publisher of Double-A games—a genre that is now in decline as AAA and indie titles gain popularity, which Takashi Kiryu has previously addressed during the Financial Results Briefing.

Of course, there's also the matter of distributing resources. For the simple reason that some of these games, such as Forspoken, Avengers, or Babylon, actually have Triple-A budgets. Nevertheless, this was the intention of Takashi Kiryu when he mentioned the need to be more selective with their resources. He intended to put money into titles that they were confident would be successful. Interestingly, the sales performance of Final Fantasy XVI and Final Fantasy VII Rebirth is also a source of concern. At this time, the actual sales figures for Final Fantasy VII Rebirth are unknown. No news on sales for Final Fantasy XVI has been announced, thus the game is still sitting at approximately 3 million. Nonetheless, it's reasonable to expect an upgrade sometime around that time, as Final Fantasy XVI's PC version is in the works. It's safe to assume that the title is worth close to 5 million. But he thought that Final Fantasy sales were declining causing some concern for Squire Enix.

 

I believe both games performed adequately; I don't see any way that one of them failed. But one thing is quite clear: sales for Final Fantasy titles have been stagnant as of late. The overall growth of FF isn't what you may expect. For example, consider the Resident Evil series; the original Resident Evil 2 sold close to 5 million copies. As of October 2023, more than thirteen million copies of Resident Evil 2 Remake had been sold. Almost three times as many copies sold as the first game. This clearly shows how big of an improvement Resident Evil has made. That came about as a result of a remake of one of the most played Resident Evil games. Meanwhile, Final Fantasy 7 made a tidy profit; the original game sold over 14 million copies, while the remake only managed about 7.3 million. Neither of these figures is bad. But it's obvious that FF isn't exactly gaining popularity, and that's one of the big problems that Square Enix is dealing with.

No notable Final Fantasy games were among those that were canceled. Concerns about the cancellation of Final Fantasy IX Remake and Final Fantasy Tactics Remake have led some to believe that these are the only remaining remakes in the series. Simply because Final Fantasy is a well-known brand that continues to sell decently despite the fact that it isn't actively attracting new fans. Furthermore, I do not believe that any of the major Dragon Quest titles or similar projects have been canceled.

This may seem like upsetting news to Square Enix fans, but I can't help but consider the bigger picture. Indeed, it is a pity that some highly anticipated games have been canceled, but Square Enix's choice to focus on quality rather than quantity is a brilliant move that, yet should lead to a new output of quality games. The positive aspect here is that this will help Square Enix in the long run. Unlike in 2022 and 2023, when Square Enix released a deluge of games, this year they will release a select few. Their main priority will be on creating high-quality games that resonate with players, receive positive reviews, and eventually sell well and be beloved by fans. During that period when they were releasing games weekly, we wondered how many games tanked in sales, and were otherwise forgotten. It would have been smarter to use that money to develop a more polished game that would have garnered more attention, and Takashi Kiryu recognizes this.
 

Azfar Rayan (@AzfarRayan)
Senior Editor, NoobFeed