Square Enix has a lot riding on Final Fantasy VII Rebirth's success

Whether or not Square Enix achieves its full-year profit targets depends largely on Final Fantasy 7 Rebirth's sales.

2

Following Final Fantasy XVI's successful release and subsequent 3 million+ sales, Square Enix has one more big tentpole release up its sleeves to maximize sales revenues and profits. The Japanese games company will launch Final Fantasy VII Rebirth next month, sending off its FY25 timeline with a potential sales surge.

As far as profits, Square Enix has set a 55 billion yen operating income target for FY24, which amounts to roughly $372 million. The company booked 17 billion yen in net income (roughly $117 million) for the first two quarters of the year, leaving the lucrative holiday period and the Q4 period in which FF7 Rebirth will release.

In a recent Q&A with investors, Square Enix CEO Takashi Kiryu says that successful execution of the operating income target will largely depend on Final Fantasy 7 Rebirth's overall sales.

Q: Do you expect a sizable profit contribution from "FINAL FANTASY VII REBIRTH," which is due out in February 2024? What factors do you expect will add to your profits in 2H?

A: We believe that sales of "FINAL FANTASY VII REBIRTH" are the greatest variable on which our ability to achieve our full-year operating income target of ¥55.0 billion hinges.

The feedback that we have received thus far on the title has been strong. As such, we do hope to see a sizable earnings contribution from it in Q4. In fact, we expect sizable earnings contributions in Q4 not only from our HD Games sub-segment but also from our Games for Smart Devices/PC Browser sub-segment thanks to "FINAL FANTASY VII EVER CRISIS," which we launched in September.

This is because of the synergies that we expect will arise between that title and "FINAL FANTASY VII REBIRTH," as well as because of the six-month anniversary and other events that we have planned.

We also hope to see a stronger performance from the MMO sub-segment in Q4 and beyond because we will be holding our "FINAL FANTASY XIV" Fan Festival at the Tokyo Dome in January 2024, which we expect will gradually build up excitement ahead of the expansion pack's release of "FINAL FANTASY XIV: Dawntrail" in the summer of 2024.