Square Enix revises full-year forecast, expects major losses
UPDATE: Tomb Raider expected to sell 3.4m units in debut month, but still falls short
Update: Square Enix expects Crystal Dynamics' Tomb Raider to have sold 3.4 million units - excluding downloads - by the end of the fiscal year on March 31. Despite the game only launching on March 4, the company's investor materials indicate that it still failed to meet its target.
IO Interactive's Hitman: Absolution, which was launched in November, is expected to have sold 3.6 million by the end of the fiscal year, and United Front's Sleeping Dogs 1.75 million. In both cases, the games are deemed to have fallen short of expectations.
Blame for the misses is partially attributed to Square Enix's "ineffective" North American sales force, which delivered around two-thirds of the unit sales in Europe.
Original Story: Square Enix has warned its investors to expect an "extraordinary loss" for this fiscal year following a revision of its financial results forecast.
For the year ending March 31, 2013, Square Enix now expects to make a net loss of ¥13 billion ($138m/£91m) - ¥16.5 billion lower than the ¥3.5 billion ($37m/£24m) net income forecast on October 30 2012, and well down on the ¥6 billion ($64m/£42m) profit it posted the previous year.
The company also expects a drop in revenue, albeit less pronounced: from ¥150 billion to ¥145 billion ($1.5b/£1b).
In a document issued to investors, Square Enix attributed its weak performance to, "slow sales of major console game titles in North America and European markets." The document didn't mention specific games, but the launches of both Hitman: Absolution and Tomb Raider fell after its last results forecast on October 30, 2012.
Other contributing factors included the "sluggish" performance of its arcade business, and around ¥10 billion in costs attached to major reforms and restructuring across the company to meet the shifting demands of the games market.
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