Square Enix Holdings Consolidated Financial Results: Three-Month Period Ended June 30, 2021

The consolidated financial results for the three-month period ended June 30, 2021, reflect a period of mixed performance for the group, characterized by a slight increase in net sales alongside a significant decline in operating income. Net sales reached 88,604 million yen, representing a 1.8% increase over the same period in the previous year. However, operating income fell by 29.5% to 17,316 million yen, and profit attributable to owners of the parent decreased by 11.9% to 12,655 million yen.

The Digital Entertainment segment, the company’s primary revenue driver, experienced a 6.0% decline in net sales and a 34.2% drop in operating income. While the MMO sub-segment saw growth due to increased subscribers for Final Fantasy XIV, the HD Games sub-segment faced a year-over-year decline compared to the previous period, which benefited from the release of Final Fantasy VII Remake. Conversely, the Amusement segment showed a strong recovery, moving into profitability with 344 million yen in operating income as facilities reopened following COVID-19-related closures. The Publication segment also performed well, with net sales and operating income rising by 32.6% and 38.4%, respectively, driven by robust digital and print media sales.

The company implemented significant changes to its accounting policies during this quarter, specifically adopting the Accounting Standard for Revenue Recognition. This transition impacted the reporting of digital content revenue and microtransactions, resulting in a 164 million yen increase in operating income for the quarter. Despite these shifts, the company maintained its consolidated earnings forecasts for the fiscal year ending March 31, 2022, citing a need to further assess market trends and sales performance.