Square Enix has announced that they plan to shift to a high-quality, large-scale AAA game development focus under Luminous Productions, a studio that they established recently led by Final Fantasy XV game director Hajime Tabata.
The report indicates that they suffered from a loss of around 3733 million, which roughly translates to 33 million USD for Square Enix. This covers the six month period ending on September 30th, 2018.
The official statement clarifies that Square Enix has decided to shift to large-scale, high-quality AAA game development, which they believe is the strength of Luminous Productions.
Having conducted an in-depth review of the business strategy for Luminous Productions Co., Ltd., a wholly-owned subsidiary (the “Subsidiary”), the Company had decided to focus the Subsidiary’s development efforts on large-scale, high-quality AAA game titles, which best leverages the Subsidiary’s strengths. This decision has resulted in the booking of an extraordinary loss amounting to 3,733 million yen, including the disposition of the portion of the content production account related to the game titles under development at the Subsidiary and impairment losses on intangible assets, in the Company’s financial results for the six-month period ended September 30, 2018.
Hajime Tabata was the director of Final Fantasy XV that was released in late 2016. The game has sold through more than 8.1 million copies worldwide, becoming one of the fastest selling Final Fantasy releases. As for Luminous Productions, their portfolio is relatively unknown as a new studio so it is a mystery what projects were canceled based on this new statement from Square Enix.