Square Enix Reveals Final Fantasy 16 and 7 Rebirth Sales Fell Short of Expectations
Square Enix has disclosed its disappointment with the commercial performance of Final Fantasy 16 and Final Fantasy 7 Rebirth, admitting that both titles did not meet their profit expectations.
In a financial results briefing held on May 13 but released today, September 18, Takashi Kiryu, president and representative director of Square Enix, stated: "In the HD Games sub-segment, we released multiple new titles, including major titles such as Final Fantasy 16 and Final Fantasy 7 Rebirth, but profits unfortunately did not meet our expectations."
Kiryu acknowledged ongoing issues within the Digital Entertainment segment, noting that the HD Games sub-segment has struggled with profitability and incurred operating losses throughout the previous medium-term plan. He added, “We did not manage our title portfolio across the company as well as we could have, which I believe resulted in opportunity losses due to cannibalization between our own titles."
Final Fantasy 16 launched in June 2023, followed by Final Fantasy 7 Rebirth in February 2024. Both games were exclusive to PlayStation 5 at launch. While Square Enix has reported sales figures for Final Fantasy 16, it has yet to disclose figures for Final Fantasy 7 Rebirth, the second installment in the Final Fantasy 7 remake trilogy.
To address these issues, Square Enix is restructuring its business strategy, focusing on multi-platform releases including PC, and potentially Xbox and the next Nintendo console. They have also canceled several projects and are refining their game pipeline to improve profitability. Kiryu mentioned, “In the case of the HD Game sub-segment, sales of individual games will remain the key variable, but we believe that we will be able to exercise some degree of control over that volatility by carefully curating our pipeline over the next three years.” He added, “By also working steadily to improve our profitability, we intend to offset the weakness in SD games to achieve overall profitability.”
The company has extended the timelines for some projects due to the extensive development time required for HD games and a reassessment of how to deliver these titles to customers. Additionally, Square Enix's Foamstars, a Splatoon-style game, has struggled and has transitioned to a free-to-play model.
Looking ahead, Square Enix has Kingdom Hearts 4, the third installment of the Final Fantasy 7 remake trilogy, and Dragon Quest 12 in development. In January, Final Fantasy 16 producer Naoki Yoshida suggested it might be time for a new generation to lead the franchise and oversee Final Fantasy 17.