Japanese game developer Square Enix has disclosed its Q1 earnings report for this fiscal year
Japanese game developer Square Enix, Recently the
company behind Final Fantasy and the upcoming game Forspoken, the Japanese game
developer, Square Enix (SE) has disclosed its Q1 earnings report for the fiscal
year ending on March 31, 2022. As part of its medium-term business strategy in
2022, it plans to incorporate nonfungible tokens into more game products.
Square Enix just reported its best year ever. For Square Enix Sales, operating profit, and overall profits all reached new all-time highs during FY22. As per the latest earnings report Square Enix raked in $3 billion in net sales because of strong over-performance in the MMO segment and consistent earnings in HD Games and mobile. On May 3 the firm owns the Final Fantasy property and sold the Tomb Raider franchise Crystal Dynamics, Eidos Montreal, and its Western mobile game dev studios to Embracer Group for $300 million which is less than half of this year's production account spending. An earnings report can give the public an idea of where a company plans to go with its future. NFTs and blockchain will continue to be the focus of the company's efforts.
In the earnings report, Square Enix also states that it wants to strengthen its "IP ecosystem." SE's top blockchain domain initiatives include establishing regulatory clarity and guidelines for blockchain games, addressing scalability in NFT economies, and developing a corporate capital venture unit. Further, the firm stated that it has plans to create an overseas entity that will oversee the issuance, management, and investment of its own tokens, suggesting that the firm will begin creating a gaming-token economy.
As a third objective in its medium-term business strategy, the report highlights investments in and monetization of blockchain, artificial intelligence (AI), and cloud computing. This is in line with CEO Yosuke Matsuda’s expressed intention for his company to become more involved in those technologies in January.
As of February, this year, the company began experimenting with NFTs on the Shi-San-Sei Million Arthur game. The success of the pilot program will lead to the second season of the game's NFTs, and ultimately the company will pursue broader activities in the NFT and blockchain industries. After the pilot program's success, the game will have a second season of NFTs, and the company will eventually pursue broader activities in blockchain and NFTs.
Square Enix has invested $792 million into new projects and business models, including new games, studio ramp-ups, and emerging technologies like blockchain which is a record-breaking investment.
About 26-30% of the company's net sales go into production accounts each year, which is a substantial budget that's spent on all of the company's upcoming projects. Both studios had significant losses and the sale was made to cut losses and lean out for more targeted games.
The fans found this ironic, considering Square Enix recently sold its Western studios and lost dozens of IPs which included Tomb Raider, Deus Ex, and some other IPs that haven't been seen in years like Sleeping Dogs. It is unlikely that Square Enix will be selling Bored Apes any time soon.
CBW - External Analyst