In a recent financial memo, Square Enix, creators of Final Fantasy and Dragon Quest, stated that it will recognize significant losses due to canceling some undisclosed game projects. The company anticipates about $140 million (¥22.1 billion) in “content abandonment losses” for the fiscal year ending in March 2024.
In a sudden shift, Square Enix’s board of directors decided to change its strategy for creating high-definition games. During a meeting in March, they voted to become more careful in choosing which projects to develop, concentrating resources on those with greater potential for commercial success (thanks, GR). This sounds like a lot, but it’s likely the company planned on some losses, and it may mean the potential loss would have been higher had they not left certain projects.
The details of the scrapped games have not been revealed, but this announcement shows that Square Enix isn’t writing any blank checks for the time being. Square Enix appears to realize that not every game is worth investing in. They’ve decided to stop investing in smaller projects and focus on more promising releases.
Earlier this year, Square Enix’s president, Takashi Kiryu, said he wanted to expand the company’s portfolio beyond established franchises like Final Fantasy and Dragon Quest because they seem to be two big series the company is known for. However, it’s uncertain whether the recent cancellations align with this goal of cultivating a broader range of titles.
The decision to cancel these unfinished games is part of larger internal changes at Square Enix. Recent reports suggest changes in the company’s management, including the departure of a key figure in the making of Dragon Quest games. This reorganization suggests that the company may be trying to change how it makes games, but we’ll have to see how it all plays out.
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