Square Enix Holdings Consolidated Financial Results: Three-Month Period Ended June 30, 2012

Square Enix Holdings reported its consolidated financial results for the three-month period ending June 30, 2012, reflecting a challenging start to the fiscal year. The company recorded net sales of 24,914 million yen, a modest 1.6% increase compared to the same period in the previous year. Despite this slight revenue growth, the company shifted from a profit to a loss, reporting an operating loss of 1,163 million yen and a net loss of 2,077 million yen, compared to a net income of 690 million yen in the prior year’s first quarter.

Performance across business segments was mixed. The Digital Entertainment segment, which encompasses console, PC, and mobile gaming, saw net sales decline by 3.9% to 11,336 million yen, resulting in an operating loss of 111 million yen. While specific titles like Dragon Quest Monsters: Terry no Wonderland 3D and various social networking games performed well, overall console game sales remained weak. The Amusement segment also struggled, posting an operating loss of 50 million yen due to stagnant market conditions. Conversely, the Publication and Merchandising segments demonstrated resilience, with Publication net sales rising 18.1% to 3,012 million yen and Merchandising net sales increasing 15.3% to 586 million yen.

The company’s financial position remains stable, with a consolidated equity ratio of 63.3%. Total assets decreased to 205,283 million yen, primarily due to reductions in cash and deposits. Management maintains its previously issued full-year forecasts, aiming for a significant earnings recovery through the expansion of digital services and the launch of major massively multiplayer online (MMO) titles. The results were prepared in accordance with Japan GAAP, and the company noted minor changes in accounting policies regarding the depreciation of tangible fixed assets.