Square Enix Reports 25% Drop in Game Revenue for Q1 FY2025

TIG SEA2 weeks ago

7 2 minutes read

Disappointing sales of new releases raise concerns for the legendary publisher

Despite being one of the most iconic names in gaming, Square Enix is feeling the pressure of an increasingly competitive global market. In its recently released earnings report for the first quarter of fiscal year 2025 (ending June 30), the company revealed a significant downturn in revenue—particularly within its core gaming division.

Key Financials Show Sharp Declines

Square Enix reported total net sales of ¥59.2 billion (approx. THB 12.98 billion), marking a 15.2% decrease compared to the same period last year. Even more concerning is the company’s net profit, which plummeted by 54.8% to ¥4.8 billion (approx. THB 1.05 billion).

The Digital Entertainment segment—home to all of Square Enix’s gaming operations—fared worst, with revenue dropping 25% year-over-year to ¥32.9 billion (approx. THB 7.21 billion).

Segment Breakdown: Across-the-Board Declines

HD Games (console and PC titles)
This subsegment saw a sharp 27.6% decline in revenue, down to ¥8.9 billion, in contrast to ¥19.51 billion last year. The dip is partly attributed to a less impactful release lineup this year, which included Bravely Default: Flying Fairy HD Remaster and Final Fantasy XVI on Xbox Series X|S—compared to last year’s multiple Kingdom Hearts launches on Steam.
Mobile and Browser Games
Revenue from mobile and PC browser-based games also took a hit, dropping 24.3% to ¥14.3 billion (approx. THB 3.13 billion). This was primarily due to weakening sales of existing titles, though the segment’s profit margin improved slightly thanks to revamped payment systems.
MMO Titles
Massive multiplayer online games like Final Fantasy XIV also saw revenue fall from ¥12.5 billion to ¥9.6 billion (approx. THB 2.1 billion), along with a decline in profits.

A Bright Spot: Arcade and Prize Business

Not all areas were in decline. The Amusement segment, which includes arcade machines and prize merchandise, reported an 8.5% increase in revenue, totaling ¥16.4 billion (approx. THB 3.59 billion). Stronger performance at existing locations and increased sales of prize products drove this growth.

Final Thought

While Square Enix remains a household name with powerful franchises under its belt, the company’s Q1 report for FY2025 reflects a difficult phase. Lackluster sales from new game releases are a key concern, especially when coupled with a decline in MMO and mobile revenues. However, hope is far from lost—several major upcoming projects may offer a chance for recovery. For now, all eyes are focused on Square Enix’s ability to navigate the upcoming challenges and regain its previous financial momentum.