Square Enix rakes in record profit

TOKYO--Square Enix reported today that it set new records in sales, operation profits, and net earnings for the business year ended March 31, 2005. The company's sales were up 16.9 percent to 73.8 billion yen ($686 million), operation profits were up 36.3 percent to 26.4 billion yen ($245 million), and net profit was up 35.8 percent to 14.9 billion yen ($139 million).

Square Enix comments that the sales in its core consumer game software segment, particularly those of Dragon Quest VIII (PlayStation 2) and Kingdom Hearts: Chain of Memories (Game Boy Advance), made significant contributions to the company's bottom line. In Japan, Dragon Quest VIII--the predecessors of which have been something of a national obsession in Japan--sold a total of 3.61 million units since its release in late November. Kingdom Hearts: Chain of Memories sold 360,000 units in Japan and 640,000 units in America, totaling 1 million units worldwide. Final Fantasy I & II (GBA) almost reached a million copies sold as well: it shipped 290,000 units in Japan, 500,000 units in America, and 150,000 units in Europe.

In FY 2005, Square Enix released 11 titles in Japan, seven titles in America, four titles in Europe, and one title in Asia. When including older titles, the company shipped 6.3 million game units in Japan, 3.76 million units in America, 920,000 units in PAL regions (including Europe), and 70,000 units in Asia. While sales were actually down by 2.57 million units from FY 2004, sales in Square Enix's consumer game segment were up 10.4 percent to 41.9 billion yen ($400 million), and the segment's operation profits were up 19.8 percent to 19.6 billion yen ($182 million).

Another major contributor to Square Enix's earnings for the year was its online segment. Revenue from Square Enix's online fees rose 55 percent to 13.8 billion yen ($128 million), and its operation profit more than doubled to 5 billion yen ($47 million). The company explains that PlayOnline and Final Fantasy XI users continued to grow during the year, and there are currently over 500,000 subscribers to FFXI. Square Enix also says that its massively multiplayer online role-playing game, Cross Gate, is still popular in China.

Revenue from Square Enix's mobile content segment was up 63 percent to 4.5 billion yen ($42 million), and operation profits rose 50 percent to 1.7 billion yen (16 million). During the past year, the company began launching online mobile games based on popular franchises, such as Before Crisis: Final Fantasy VII and Front Mission 2089.

Looking ahead, Square Enix forecasts sales of 90 billion yen (837 million), operation profit of 27 billion yen (251 million), and a net profit of 15.5 billion yen (144 million) for the current business year starting April 1. One of the major games that Square Enix is expected to release during the business year is Final Fantasy XII for the PS2. The title was not shown at E3, but the company will show a playable version of the game at the end of July.

For more information on Square Enix's plans for the future, check out GameSpot's coverage of the company's E3 announcements.