Square Enix Holdings Financial Results Briefing: Fiscal Year Ended March 31, 2021

Square Enix Holdings reported strong financial performance for the fiscal year ended March 31, 2021, achieving net sales of ¥332.5 billion and operating income of ¥47.2 billion. These results represent a significant year-over-year increase of ¥72 billion in net sales and ¥14.5 billion in operating income. The company successfully met its medium-term earnings targets, bolstered by recurring revenue from its MMO and smart device game segments, despite mixed performance from certain high-definition console titles.

The Digital Entertainment segment served as the primary growth driver, generating ¥263.9 billion in net sales and ¥50.5 billion in operating income. While the HD games sub-segment benefited from catalog sales and licensing, the company noted that the performance of Marvel’s Avengers fell below initial expectations. Conversely, the Publication segment saw substantial growth in both digital and printed formats, contributing ¥26.8 billion in net sales. The Amusement segment faced challenges due to COVID-19-related facility closures, resulting in an operating loss of ¥1.5 billion.

Looking ahead, the company has established medium-term targets of ¥400–500 billion in net sales and ¥60–75 billion in operating income, aiming for an operating margin of approximately 15%. Strategy focuses on building a robust pipeline of new intellectual property and maximizing the efficiency of development and marketing expenditures. For the fiscal year ending March 31, 2022, management projects net sales of ¥340 billion and operating income of ¥40 billion, acknowledging the inherent risks associated with a release schedule heavily weighted toward new intellectual property. The company continues to prioritize shareholder returns, evidenced by a special dividend payout following the achievement of record operating cash flow.