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Square-Enix cuts quarterly losses by 75%, remains in red

Square-Enix cuts quarterly losses by 75%, remains in red

Tue 06 Aug 2013 7:24am GMT / 3:24am EDT / 12:24am PDT
Financial

1.6 billion extraordinary loss for "review on work-in-progress games"

Square Enix has reduced its losses by 75 per cent since last the same quarter last year, finishing just 493 million ($5m) in the red in a quarter with no releases. For the quarter ending June 30, 2012, that deficit was 2.01 billion ($21m).

Although no big titles went to market, Square Enix indicated good performance from browser and mobile games, particularly Sengoku IXA and Kaku-San-Sei Million Arthur. The company's amusements business also showed continued growth- booking 9.7 billion worth of revenue compared to digital entertainment's 115 billion for the quarter.

Alongside these results, the company has reported the booking of an extraordinary loss of 1.6 billion ($16.2m). Extraordinary losses are those which are incurred via unusual circumstances and are not expected to be repeated, such as natural disaster. Square Enix's costs, however, were self-inflicted.

"In response to the latest environmental changes in the game industry, the Group has implemented a change in its development policy, and conducted a comprehensive review on work-in-progress game titles for the three-month period ended June 30, 2013," reads the report. Exactly what form that review process took is unclear, but it's possible that the losses are partly the incurred costs of project cancellations.

These costs do not impact on the company's full-year predictions, which have estimated a end-of-year net profit of 3.5-6 billion.

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