Final Fantasy XVI is the latest entry in the long-running RPG franchise. It represents a new direction for the series, and the game earned itself considerable critical acclaim upon release, scoring a 9 here on Destructoid. This hasn’t quite translated into financial success, at least according to the latest reports following the release of Square Enix’s first-quarter financial briefing.
Square Enix’s financial report reveals that although net sales are up thanks to the release of new titles such as Final Fantasy XVI, operating income is down partly due to amortization of development cost. According to Bloomberg, Square Enix President Takashi Kiryu told analysts on a post-earnings call that Final Fantasy XVI did not meet the high end of the company’s expectations.
The Final Fantasy franchise and the PS5’s install base
Though Final Fantasy is one of Square Enix’s flagship franchises, it appears it is not performing well enough to meet the company’s goals. In a note to investors (per Bloomberg), Citigroup analyst Junko Yamamura stated that “the Final Fantasy franchise’s profitability is weakening and improvements will take time.” This doesn’t mean that Final Fantasy XVI was a complete failure, as it managed to sell 3 million units shortly after launch.
The financial report also reveals that net sales are down year-on-year for its MMOs, though the dip is easily attributed to Endwalker launching last year and no new expansion until next year’s Dawntrail. PC browser and mobile games were unable to “offset weak performances from existing titles.” News of Square Enix’s declining operating income has affected the value of the company’s stock, driving “the stock down as much as 15% in Tokyo” according to Bloomberg.
Square Enix isn’t about to give up on Final Fantasy just yet. Part of the problem, according to Kiryu via Bloomberg, is the slow adoption of the PS5. Addressing comparisons of FF XVI‘s launch numbers to FFVII Remake‘s, the company released a statement to IGN arguing that “the attach rate of Final Fantasy XVI is considerably high, given the PS5 install base,” though the company has plans to “carry out a wide range of initiatives to encourage even more people to play the game.” This should be easier now that supply constraint factors for hardware are no longer as big of a problem for Sony.
As the financial report also reveals, Square Enix has various initiatives in store to celebrate the tenth anniversary of Final Fantasy XIV: A Realm Reborn, and Final Fantasy XIV: Dawntrail is slated for a 2024 release. Of course, the highly anticipated Final Fantasy VII: Rebirth is also in the works and it has a 2024 release date.
Final Fantasy XVI is available now on PS5.
Published: Aug 7, 2023 10:00 am