Final Fantasy

Financial Results Briefing Session: Six-Month Period Ended September 30, 2018

The financial results for the six-month period ending September 30, 2018, reflect a challenging fiscal environment for Square Enix Holdings Co., Ltd. compared to the same period in the previous year.

• Square Enix reported a decline in performance for the six-month period ending September 30, 2018, with net sales falling to 112.2 billion yen (down 19.8 billion yen YoY) and operating income dropping to 10.0 billion yen (down 15.8 billion yen YoY).
• Luminous Productions, a wholly-owned subsidiary, recorded an extraordinary loss of 3.733 billion yen due to a strategic shift toward focusing exclusively on large-scale, high-quality AAA titles.
• The Digital Entertainment segment for smart devices and PC browsers saw a decline in both net sales and operating profit, attributed to the underperformance of titles launched in the previous fiscal year and reduced license income.

Game of War Revenue Has Surpassed $2.8 Billion in Five Years

The mobile strategy title Game of War has established itself as a significant commercial success, generating over $2.8 billion in worldwide player spending during its first five years of operation.

• MZ's mobile strategy title Game of War generated over $2.8 billion in worldwide player spending during its first five years of operation.
• Revenue distribution by platform shows $1.6 billion from iOS (57%) and $1.2 billion from Google Play (43%).
• The United States is the primary market for the game, accounting for 60% of total lifetime revenue, or approximately $1.7 billion.

Financial Results Briefing: Fiscal Year Ended March 31, 2018

Square Enix Holdings reported its financial results for the fiscal year ended March 31, 2018, highlighting a period of strategic transition toward digital-first revenue streams.

• Square Enix reported FY2018 net sales of ¥250.3 billion, a 2.5% decrease, while operating income grew 22.0% to ¥38.1 billion and net income rose 28.9% to ¥25.8 billion.
• The company set medium-term targets for the fiscal year ending March 31, 2020, aiming for ¥300–400 billion in net sales and ¥40–50 billion in operating income.
• Growth was driven by high-margin digital catalog sales, specifically NieR:Automata, and expansion packs for MMO titles Final Fantasy XIV and Dragon Quest X.

Square Enix Holdings Financial Results: Fiscal Year Ended March 31, 2018

Square Enix Holdings reported its financial results for the fiscal year ended March 31, 2018, demonstrating a period of improved profitability despite a slight decline in overall net sales.

• Square Enix reported a consolidated operating income of 38.1 billion yen for the fiscal year ended March 31, 2018, representing a 6.9 billion yen increase over the previous year despite a slight decline in net sales to 250.3 billion yen.
• The Digital Entertainment segment drove profitability with an operating income of 43.4 billion yen and a margin of 22.7%, bolstered by strong performance in smart device/PC browser games and MMO expansions.
• For the fiscal year ending March 31, 2019, the company forecasts a decline in operating income to 30.0 billion yen, down from 38.1 billion yen, alongside a projected reduction in dividends per share from 65 yen to 53 yen.

Square Enix Holdings Financial Results Briefing: Nine-Month Period Ended December 31, 2017

Square Enix Holdings reported its financial results for the nine-month period ending December 31, 2017, demonstrating a trend of declining net sales alongside significant growth in operating and recurring income.

• Square Enix reported a 57.2% increase in operating income to ¥33.7 billion and a 30.9% rise in net income to ¥22.3 billion for the nine-month period ending December 31, 2017, despite a 1.0% decline in net sales to ¥188 billion.
• The Digital Entertainment segment generated ¥143.5 billion in net sales, driven by strong digital catalog sales of titles like NieR:Automata and growth in MMO subscribers following Final Fantasy XIV and Dragon Quest X expansions.
• Profitability improved due to a strategic shift toward high-margin digital sales and catalog monetization, which successfully offset a lighter release schedule for new HD games compared to the previous year.

Square Enix Holdings Nine-Month Financial Results: Period Ended December 31, 2017

The Square Enix Holdings financial results for the nine-month period ending December 31, 2017, demonstrate a period of significant profit growth driven primarily by the company’s Digital Entertainment segment.

• Square Enix reported a significant increase in operating income for the nine-month period ending December 31, 2017, rising to 33.7 billion yen from 21.4 billion yen in the prior year, representing an operating margin of 18.0%.
• The Digital Entertainment segment was the primary driver of growth, with operating income surging to 36.3 billion yen compared to 21.7 billion yen in the previous year, fueled by strong performance in MMO expansions and mobile titles.
• MMO revenue saw substantial gains due to the release of expansion disks for 'FINAL FANTASY XIV' and 'DRAGON QUEST X' and an increase in paying subscribers.

2018 Annual Report

Square Enix Holdings concluded the 2018 fiscal year with a robust financial performance, characterized by record-high operating and net income despite a marginal 2.5% decline in consolidated net sales to ¥250.4 billion.

• The Square Enix Group's corporate philosophy is to spread happiness globally by providing unforgettable experiences through high-quality content, services, and products.
• The company aims to be a leader in entertainment, focusing on creating new and creative gaming experiences and hit titles, particularly revisiting development and operation organizations in the fiscal year ending March 2019.
• In the fiscal year ended March 2018, the Amusement segment saw sales decline to ¥41.7 billion and operating income fall to ¥2.4 billion, despite stable arcade operations and new initiatives like renovating Taito Station Mizonokuchi and opening MEGARAGE.

Square Enix Holdings 2Q FY2018/3 Financial Results Briefing

Square Enix Holdings reported strong financial growth for the first half of the fiscal year ending March 31, 2018.

• Square Enix reported strong 1H FY2018/3 financial growth, with net sales reaching ¥132.0 billion (+24.2% YoY) and operating income rising 132.3% to ¥25.8 billion.
• The Digital Entertainment segment drove performance through the launch of 'DRAGON QUEST XI,' increased paying subscribers for 'FINAL FANTASY XIV,' and strong catalog title downloads.
• Digital sales in the Publication segment exceeded 20% of total revenue in 1H FY2018/3, largely attributed to the success of the 'MANGA UP!' distribution app.

Square Enix Holdings Financial Results: Six-Month Period Ended September 30, 2017

Square Enix Holdings reported strong financial growth for the six-month period ending September 30, 2017, characterized by significant increases in both net sales and operating income compared to the same period in the previous fiscal year.

• Square Enix reported strong growth for the six-month period ending September 30, 2017, with net sales rising to 132.0 billion yen, a 25.7 billion yen increase over the same period in 2016.
• Operating income surged to 25.8 billion yen, more than doubling the 11.1 billion yen recorded in the prior year's first half, driven primarily by blockbuster HD game releases.
• The Digital Entertainment segment remains the primary revenue driver, contributing 102.1 billion yen in net sales and achieving an operating income margin of 26.0%.

Square Enix Holdings 1Q FY2018/3 Financial Results Briefing

Square Enix Holdings reported strong financial growth for the first quarter of the fiscal year ending March 31, 2018.

• Square Enix reported strong 1Q FY2018/3 results with net sales of ¥57.0 billion (+11.3% YoY) and operating income of ¥12.8 billion (+43.9% YoY).
• The Digital Entertainment segment drove performance with ¥44.1 billion in sales (+17.7% YoY) and ¥13.7 billion in operating income (+44.9% YoY).
• Growth in the Games for Smart Devices/PC Browsers sub-segment was bolstered by license fees from Machine Zone, Inc. for 'FINAL FANTASY XV: A NEW EMPIRE' and the full amortization of development costs for existing titles.

Square Enix Holdings Three-Month Period Ended June 30, 2017: Reference Materials

Square Enix Holdings reported strong financial growth for the first quarter of the fiscal year ending March 31, 2018, covering the period from April 1 to June 30, 2017.

Square Enix Holdings Consolidated Financial Results: Three-Month Period Ended June 30, 2017

Square Enix Holdings reported strong financial growth for the three-month period ending June 30, 2017, driven primarily by robust performance in its Digital Entertainment segment.

• Square Enix reported strong growth for the three-month period ended June 30, 2017, with net sales rising 11.3% to ¥57,000 million and operating income increasing 43.9% to ¥12,874 million compared to the same period in 2016.
• The Digital Entertainment segment was the primary growth driver, achieving ¥44,168 million in net sales and ¥13,724 million in operating income, representing year-on-year increases of 17.7% and 44.9% respectively.
• Digital Entertainment performance was bolstered by strong download sales of catalogue titles like 'NieR:Automata,' consistent success from smart device games such as 'FINAL FANTASY BRAVE EXVIUS,' and increased revenue from 'FINAL FANTASY XIV' following its latest expansion.