Square-Enix's forecasted profits for the full 2010 financial year are down 89 per cent on the prior year.
The company is expecting ¥1,000 million ($12.2 million) net income for the year, following financial results for the first three quarters of fiscal 2010.
The first nine months of its financial year left Square-Enix with ¥1821 million ($22.3 million) earned and ¥98,183 million ($1.2 billion) in sales.
Revenue was down 28 per cent on the same period the previous year.
Yoichi Wada, Square-Enix president, claimed that this was due to "intensifying competition in the console game market," but expected a brighter future as "the company has implemented organisational changes in the third quarter while also working to better select and further strengthen our most competitive titles.
"In other platform areas including PCs and smartphones, we have created successful examples of new content such as Nicotto Town and SENGOKU IXA. By pursuing these two independent markets, we are raising our ability to succeed in diverse business models."
Despite the hard times, both Kane & Lynch 2 and Dragon Quest Monsters Joker 2 sold over a million copies during Q3.
Slated for the fourth quarter are Tactics Ogre Let Us Cling Together, Puzzle Bobble 3D, DISSIDIA 012[duodecim], Tomb Raider Trilogy pack, The 3rd Birthday, and Final Fantasy IV Complete Collection.
Also highly anticipated is Deus Ex: Human Revolution (whose lead writer GamesIndustry.biz interviews today), which falls in the next financial year.