Square Enix Holdings Financial Results: Nine-Month Period Ended December 31, 2022

Square Enix Holdings reported a decline in consolidated net sales and operating income for the nine-month period ended December 31, 2022, compared to the same period in the previous fiscal year. Net sales fell to 255.6 billion yen, down from 273.6 billion yen, while operating income decreased to 41.3 billion yen from 50.1 billion yen. Despite these operational declines, the company saw an increase in profit attributable to owners of the parent, which rose to 46.3 billion yen, driven by foreign exchange gains and the sale of shares in affiliated companies.

The Digital Entertainment segment, the company’s primary revenue driver, experienced a notable downturn. Segment net sales dropped to 184.3 billion yen, and operating income fell to 38.7 billion yen. This performance was attributed to weak results from existing titles in the smart device and PC browser categories, which were not offset by new releases. Additionally, HD game sales failed to reach the levels achieved in the prior year, and the MMO segment faced a difficult comparison against the previous year’s expansion pack launches. Total unit sales for digital and packaged games combined fell significantly to 16.43 million units, down from 29.45 million units in the prior year.

In contrast, the Amusement segment showed strong growth, with net sales rising to 40.8 billion yen and operating income increasing to 4.1 billion yen, supported by a recovery in same-store sales. The Publication segment maintained stable net sales of 21.0 billion yen, though operating income declined slightly due to rising costs for printing paper and advertising. The Merchandising segment saw increased sales of 11.9 billion yen, yet experienced a decline in operating income due to shifts in the product sales mix. The company continues to operate under Japanese accounting standards, maintaining a cautious outlook regarding future performance due to market volatility and shifting consumer preferences.