Final Fantasy 16 sales claim leaves Square Enix with 79% profit drop

Final Fantasy XVI sales have, no doubt, been big on PS5. However, Square Enix's notoriously "high-end" targets have supposedly been a part of a 79% profit drop.

Final Fantasy 16 sales claim leaves Square Enix with 79% profit drop
Kes Eylers-Stephenson

Kes Eylers-Stephenson

Published

Players collected Final Fantasy XVI trophies in droves, our tracked players on PSN soared, and we wrote a wonderful Final Fantasy XVI review. Yet, Square Enix is supposedly still unhappy with the Final Fantasy XVI sales given its "high-end" expectations set against a 79% year-on-year drop in profits.

Slow PS5 hardware rollout to blame for Final Fantasy sales?

Originally reported by Bloomberg (paywalled, via VGC), Final Fantasy XVI's publisher Square Enix reported it's Q2 2023 earnings to shareholders on Friday, August 4, 2023. While revenue has gone up by 14% since last year, gross profits are down 65%. The result is a huge drop in operating profit (gross profit minus expenses) by 79% year-on-year.
This had knock-on effects on the share prices of Square Enix when the Tokyo Stock Exchange closed on Friday and reopened early Monday, August 7, 2023. The share price started at ¥‎6,366 but fell to ¥‎5,566 and has allegedly been as low as ¥‎5,457. This is a marked fall and, according to Bloomberg, the lowest since May 2022. With three separate anonymous sources used, the reliable outley stated that Final Fantasy XVI is front and center of Square Enix's reasoning behind the drop alongside mobile decline as competition decreases.

According to those sources, president Takashi Kiryu said that the initial sales for the PS5-only game, as editorialized by Bloomberg, “did not meet the high end of the company’s expectations.” The president also alluded to the slow pickup of PS5 hardware and console shortages as a big reason for the poor financial results, though it's worth noting the JRPG was sitting at around 3.5 million units sold after 10 days on the market.
Now, the stock market drop speaks for itself and very clearly: the loss in mobile revenue is important. However, Square Enix is notoriously 'ambitious' with its sales expectations for its games. In the last few years, it claimed that Marvel's Guardians of the Galaxy, Marvel's Avengers, and the Tomb Raider trilogy all underperformed despite all of them putting up decent numbers given the contexts they released in. Those Final Fantasy XVI sales aren't bad either, but Square Enix put much more money into the game than some of its other AAA offerings so probably expects bigger returns.

A decline in operating profit will scare shareholders and Square Enix has work to do, but it feels like we've heard the song and dance around 'poor sales' before big rebounds before. In any case, it'll be very interesting to see how Square Enix reacts! What do you think of the news? Do you think Final Fantasy XVI deserves to be on the best PS5 games list? Let us know in the comments below and we will see you there.
Written by Kes Eylers-Stephenson
Editor Kes is our resident expert in PlayStation and other gaming news. He writes about PS5 exclusives like The Last of Us and Horizon, PS Plus news, and his favorite games — The Witcher, Assassin’s Creed, and God of War — before an evening swim.
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