Square Enix announced that the company expects an extraordinary loss of 22.1 billion yen ($140 million) in “content abandonment losses” following a “revised development approach.” This is due to various in-development games being canceled as Square Enix focuses on a more selective allocation toward development resources.
The Square Enix Board of Directors voted in motion to “revise the group’s approach to the development of high-definition (HD) games.” Square Enix expects the aforementioned loss (22.1 billion yen) as games that were being developed are canceled, hence the phrasing for “content abandonment losses.” Specific games effected by these changes in the company were not specified, however.
Here’s the full announcement, via Square Enix (Thanks, Gematsu):
Notification of Recognition of Extraordinary Losses
Square Enix Holdings Co., Ltd. expects to recognize extraordinary losses pertaining to abandonment losses associated with its content production account on its books for the fiscal year ended March 2024, as detailed below.
1. Nature of the Extraordinary Losses
At the meeting convened on March 27, 2024, the Board of Directors of Square Enix Holdings Co., Ltd. (the “Company”) voted, in light of the myriad changes underway in the environment surrounding its Group, to revise the Group’s approach to the development of high-definition (HD) games with the intention of being more selective and focused in the allocation of development resources. As a result of a close examination of the Group’s development pipeline undertaken in keeping with this revised approach, the Company expects to recognize approximately ¥22.1 billion in content abandonment losses on its books for the fiscal year ended March 2024.
2. Outlook
The Company is carefully reviewing its consolidated forecasts for the fiscal year ended March 2024 to assess the potential for impact from the above or other factors. Should revisions to its forecasts prove necessary, the Company will promptly disclose the same.
