Skip to main content

Square-Enix explains why it considers multi-platinum sellers like ‘Tomb Raider’ a disappointment

Tomb Raider's stealth
Image used with permission by copyright holder

Things are not well over at Square-Enix. Even before reporting its full earnings for the fiscal year that ended in March, the company announced to its investors that it would incur an extraordinary loss due to a massive overhaul of the company and its many international subsidiaries. Losses were so severe that the company had to go through its first major change in leadership in over a decade, with CEO Yoichi Wada stepping down and CFO Yosuke Matsuda taking his place. The other big cause of Square’s disappointing revenue, at least according to Wada, is the company’s console games like Sleeping Dogs, Hitman: Absolution, and even Tomb Raider, a game that’s only been out a month.

So how are games that respectively sold 1.5 million, 3 million, and 3.5 million copies disappointing? By most standards those results would be considered at least modestly successful, but not to Square-Enix. Wada explained in a new briefing released to investors on Monday how it gets away with saying these titles are disappointments. 

“Let’s talk about Sleeping Dogs: we were looking at selling roughly 2 – 2.5 million units in the EUR/NA market based on its game content, genre and Metacritic scores,” said Wada, “In the same way, game quality and Metacritic scores led us to believe that Hitman had potential to sell 4.5 – 5 million units and 5 – 6 million units for Tomb Raider in EUR/NA and Japanese markets combined. Of course, we want to hedge risk in budgeting these units directly into the forecast, therefore we base the forecast on 80 – 90 percent of the total sales potential of each title. However, it is disappointing that our results fell below these marks.”

As a result of sales that are “far weaker than we ever imagined” in North America and Europe, Square-Enix is going on a slash and burn campaign, cancelling projects and thinning staff. Across all of its operations in Japan, Europe, North America, and even new mobile operations in Mexico, India, and elsewhere, the reorganization is going to cost Square-Enix approximately $101 million.

That $101 million loss is just the latest to slam Square-Enix under Wada’s watch. The fiasco that was Final Fantasy XIV’s initial release caused Square-Enix to lose $150 million in fiscal 2011. That loss highlights the unspoken cause of Square-Enix’s woes in fiscal 2013, though. Square-Enix had unreasonable earnings expectations for its Eidos produced console games, because the company continues to spend scads on developing HD PC and console games in Japan without ever releasing any product. Final Fantasy XIV: A Realm Reborn and Final Fantasy Versus XIII have been in production for three and seven years respectively. If Square wants to point the finger at someone for poor earnings, look to the mismanagement of its Japanese development teams, not a multi-platinum seller like Tomb Raider.

Editors' Recommendations

Anthony John Agnello
Former Digital Trends Contributor
Anthony John Agnello is a writer living in New York. He works as the Community Manager of Joystiq.com and his writing has…
Volgarr the Viking 2 will take you back to your Ghosts ‘n Goblins days
A viking slashes a tree in Volgarr the Viking 2.

Developer Digital Eclipse is working on a surprising project: Volgarr the Viking 2. The 2D retro sequel will launch on August 6 for PlayStation 4, PS5, Xbox One, Xbox Series X/S, Nintendo Switch, and PC.

The news is an out of left field reveal. The first Volgarr the Viking game released in 2013 and was made as an ode to 1080s classics like Ghosts 'n Goblins. Despite being a small release, it sold over 1 million copies over the past decade. As revealed during today's Guerrilla Collective stream, the series is coming back with a new sequel by Digital Eclipse, the team behind this year's Llamasoft: The Jeff Minter Story.

Read more
3 Days of Play PS Plus games to try this weekend (June 7-9)
Key art for Streets of Rage 4.

June 2024 is shaping up to be a pretty great month for PlayStation players. Not only are we coming off an entertaining State of Play showcase, but a new Days of Play initiative surrounding all the video game showcases this month is bringing a lot of new PS Plus additions with it. Many of those games hit PS Plus this week, and three in particular stand out to us.

For owners of Sony's oft-neglected PlayStation VR2, the first game is one of its rare exclusives that take full advantage of the headset's eye-tracking by seeing how often players blink. The next is a new PS Plus Essential game that's a revival of Sega's classic beat-'em-up series for the modern gaming era. Finally, the last title is an atmospheric and eerie fishing game that should entice fans of Lovecraftian horror.
Before Your Eyes

Read more
3 first-party Xbox Game Pass games to try this weekend (June 7-9)
Gears 5 Kait Hero Close Up

Microsoft will hold an Xbox Games Showcase and Call of Duty: Black Ops 6 Direct. this Sunday. These shows will provide a much better idea of what to expect from Xbox over the course of the next year or two. That's really needed right now, as Microsoft has struggled to keep online discussions around Xbox positive as it went multiplatform with some games, laid off thousands of developers, and outright shut down the developers of Hi-Fi Rush and Redfall. Based on leaks and my personal expectations for the showcase, there are three games you can play on Xbox Game Pass this weekend to prepare for the event.

The first is the latest first-person shooter in a long-running series by id Software that might be getting a medieval-set spinoff. After that, we have the fifth entry in a sci-fi Xbox series that still looks fantastic on Xbox Series X/S even though it came out in 2019. Finally, you can prepare for Avowed with the latest RPG from Obsidian Entertainment, a satirical sci-fi game where player choice is critical.
Doom Eternal

Read more