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Square Enix Full Year FY3/2018 results, mid-term FY3/2020 plans: e-commerce, blockchain, robotics

ggx2ac

ggx2ac

Sales Heaven or Sales Hell?
Member
Oct 25, 2017
3,504
Links:

Financial Results

Results Briefing Session

Press Release:

In the Digital Entertainment segment for this Fiscal Year, where "DRAGON QUEST XI: Echoes of an Elusive Age," the latest title of the "DRAGON QUEST" series and "FINAL FANTASY XII THE ZODIAC AGE" were launched, a decrease in the number of blockbuster titles resulted in net sales
decline, as compared to the prior fiscal year. On the other hand, strong high-margin download sales of previously released catalogue titles such as "NieR: Automata" have resulted in an increase of operating income, as compared to the prior fiscal year.

In the smart devices and PC browser area, our established lineup of popular games such as "FINAL FANTASY BRAVE EXVIUS," "HOSHI NO DRAGON QUEST," "DRAGON QUEST MONSTERS SUPER LIGHT" and "KINGDOM HEARTS Union χ" is continuing to show strong performances globally, and an increase of royalty income pushed both net sales and operating income, as compared to the prior fiscal year.
In the area of massively multiplayer online role playing games, revenues from the latest expansions of "FINAL FANTASY XIV" and "DRAGON QUEST X" led to an increase in the number of paying subscribers and disk sales, which resulted in an increase of net sale and operating income, as compared to the prior fiscal year.

In the Amusement segment, operation of the amusement facilities has been showing steady performance, while new amusement machine releases decreased, which led to the decline in this segment's net sales and operating income, as compared to the prior fiscal year.

In the Publication segment, sales of comic books continues strong, in particular, the digital format sales increased, as compared to the prior fiscal year.
In the Merchandising segment, sales and licensing performed strongly thanks to character goods and soundtracks derived from the Group's own IPs.
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Square Enix
Net Sales: ¥250,394M (-2.5% YoY) [~$2.29B]
Operating Income: ¥38,176M (+22% YoY) [~$349.4M]
Net Income: ¥25,821M (+28.9% YoY) [~$236.3M]

Results by each segment
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Square Enix
Digital Entertainment (Segment)
Net Sales ¥191,469 million (~$1.75 billion)
Operating income ¥43,421 million (~$396.9 million)
Operating margin: 22.7%

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Digital Entertainment - HD Games FY3/2018
Net sales:
Q1: ¥11B
Q2: ¥27.1B
Q3: ¥12.5B
Q4: ¥15B
Full Year: ¥65.6B (~$600.6M)

Operating Income: ~¥9.0B* (~$82.4M) (Rounded to one significant figure)

*A guess from the graph and not the actual figure.

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Digital Entertainment - Games for Smart Device/PC Browser FY3/2018
Net Sales:
Q1: ¥23.7B
Q2: ¥22.7B
Q3: ¥21.3B
Q4: ¥26.1B
Full Year: ¥93.8B (~$858.8M)

Operating Income: ~¥20.0B* (~$183.1M) (Rounded to one significant figure)

*A guess from the graph, not the actual figure.

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Digital Entertainment - MMO FY3/2018
Net Sales:
Q1: ¥9.3B
Q2: ¥8.0B
Q3: ¥7.6B
Q4: ¥6.9B
Full Year: ¥31.8B (~$291.3M)

Operating Income: ~¥14.0B* (~$128.2M)

*A guess from the graph in the link (slides), not the actual figure.


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Strategies to achieve the mid-term target:

1. Digital Sales Enhancement
2. Multi Platform Utilization
3. Geographical Expansion
4. Game as a Service
Game as Media
5. E-Commerce (New)

Initiatives for sustainable growth after achieving mid-term target:

・Investment in promising entertainment-related
peripheral business domains such as;
> 3D Modeling
> AI (artificial intelligence)
> Blockchain
> Robotics
etc.

・Access to new technologies through investment in
a venture capital fund
⇒Decided to invest USD 25million.
 
Last edited:
casiopao

casiopao

Banned
Oct 28, 2017
5,044
Really interesting to see that S-E is going to try to expand to E-Commerce? Like wut? Thats one hella of a crowded market with Ebay, Alibaba, Amazon, Rakuten and etc. To break that market is going to be even harder than breaking into AAA gaming industry.

On Digital Entertainment part, it seems to have drop compared to last year as there is lesser HD game and not many of those HD game actually hit big or even hugely underperform like Dissidia and Itadaki Street.

However the mobile division seems to have been keep bringing the bucks there showing how important mobile gaming as an money making platform. NO company with the dream of being big and successful should avoid mobile market anymore. Especially when we see S-E had been having many flop on mobile this last quarter however some which become success had been bringing even more profit than not chasing the market at all.
 
Aters

Aters

Banned
Oct 26, 2017
7,948
What E-commerce? SE' making their own Steam? From the company whose store site always crashes when new release comes up.
 
CaviarMeths

CaviarMeths

Avenger
Oct 25, 2017
10,655
Western Canada
Reiterating that the net sales of MMOs seems a little low. $291m in a year with expansions for both FFXIV and DQX, plus two new SKUs for DQX doesn't leave a lot of room for revenue from subscription fees. Lower sub count than I thought, maybe.

Still, that's its highest net sales posting since beginning of reporting on that graph, so that's cool. Haven't played DQX, but XIV deserves all the success it gets.
 
Echo

Echo

Banned
Oct 29, 2017
6,482
Mt. Whatever
Always good news when my favorite publisher is doing financially well. Hearing that they plan to continue exploring and trying new things is a good sign. Worked out for Sony and Mitsubishi!
 
ILikeFeet

ILikeFeet

DF Deet Master
Banned
Oct 25, 2017
61,987
Lnds500 said:
I know. They are saying that it's not a blockbuster title and while I agree, I am surprised that Square came out and said something like that about what is supposed to be the next flagship DQ title.
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they aren't saying that it's not a blockbuster title, they're saying there are less of them overall in their release schedule. they even list DQ 11 as a major title in the second image
 
Edge_Maverick

Edge_Maverick

Member
Oct 25, 2017
187
They reached record Operating and Net Income even though sales were a bit weaker (in comparison to last FY). This year they got plenty to release so it'll be very interesting.
 
asd202

asd202

Enlightened
Member
Oct 27, 2017
9,577
They are definitely planning something big for FY2020. It's probably FFVII Remake or The Avengers game or both.
 
Edge_Maverick

Edge_Maverick

Member
Oct 25, 2017
187
asd202 said:
They are definitely planning something big for FY2020. It's probably FFVII Remake or The Avengers game or both.
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I'm guessing both. Their plan is to have 1-2 AAA games every FY. Since they are indeed aiming very high in terms of income for FY2020, I expect to see their two biggest games released during it.
 
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