In a recent meeting, those responsible at Square Enix confirmed their intention to be more selective in the production of games in the future. Furthermore, the company indicated that several projects fell victim to this new strategy.
In a recent meeting, Square Enix executives discussed the company's long-term strategy. The Japanese publisher once again emphasized that future productions will aim for the highest possible quality standard.
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At the same time, Square Enix plans to “review the group’s approach to high definition (HD) game development. With the intention of proceeding in a more selective and focused manner.” Square Enix also stated that, based on this evaluation, the company expects losses of the equivalent of 131.43 million euros.
Write-downs that Square Enix says are due to titles being discontinued or re-rated. This statement suggests that Square Enix decided to cancel or reschedule several projects given the challenging market environment. However, the publisher did not mention any specific names here.
New measures will be implemented in spring
In February formulated Square Enix's President Takashi Kiryu aims to make a drastic evaluation of the development structure in order to improve the quality of future games. Square Enix would like to take the appropriate measures over the course of the spring in order to increase the quality standard of its games.
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“We review from the ground up what the organizational structure looks like and how the content of the pipeline can best be implemented,” explained Kiryu. At the same time, Square Enix wants to reduce the number of titles that are created externally and rely more on internal production.
A step that, according to Kiryu, will not only benefit the quality of the games. At the same time, the focus on internal development is intended to optimize Square Enix's profits and get the company back on track.
Square Enix wants to expand its brands
As early as the summer of 2023, Kiryu spoke about Square Enix wanting to put its internal brands to the test and expand its own portfolio. “I want to increase our profits. “I see ample room for improvement in our operating margin and would like to begin working primarily on our HD games,” said Square Enix's president.
“In addition, rather than exclusively brand new brands, we intend to take a nuanced approach to investments where we also identify existing IPs that have the potential to be upgraded to AAA status, keeping ROI (Return on Investment) in mind “, it continued.
“Finally, I would like to continue to continually grow our release, entertainment and merchandising segments as sources of recurring revenue to enable our group to mitigate the volatility of the HD gaming sub-segment and improve its profitability.”
Source: VGC
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