Square Enix announced its financial results for the first half of the fiscal year, related to the period between April 2023 and September 2023.
Net sales were at 172,046 million yen (up 5.3％ year-on-year), while operating income amounted to was 17,337 million (down 33.4％ year-on-year).
Looking at the Digital Entertainment business segment, which includes video games, net sales were 122,046 million yen (up 4.2％ year-on-year) while operating income was 15,520 million yen (down 36.9％) year-on-year.
The comparative downturn is due to similar reasons to what we saw during the first quarter, with higher sales year on year due to the launch of Final Fantasy XVI and the Final Fantasy Pixel Remasters, while profit dropped year-on-year due "higher development cost amortization and advertising costs."
That being said, operating income recovered partly compared to Q1, going from -80.6% year-on-year to a more to -36.9%.
Sales of MMORPG dropped year-on-year, as Final Fantasy XIV is affected by a naturally slower period between expansions ahead of next year's release of Dawntrail.
Net sales also declined in the mobile sub-segment, with new games like Final Fantasy VII: Ever Crisis and Dragon Quest Champions failing to compensate for the weak performance of existing games.
It'll be interesting to see how the results will look like by the end of the fiscal year (March 31, 2024) considering the upcoming releases of Final Fantasy VII Rebirth and Dragon Quest Monsters: The Dark Prince.
The press release also mentions that Square Enix plans to present a new medium-term business plan after the end of the fiscal year, during its financial results briefing in May 2024.
Among other things, the the plan will address the challenge to increase profitability by "diversifying earnings sources and increase productivity across the company based upon the strengths o existing businesses."
If you'd like to draw a comparison with historical data, you can enjoy our article from August, showcasing the results of the previous quarter.
