Square Enix: Final Fantasy XVI 'Didn't Meet High End Expectations,' Share Prices Fall - News
by William D'Angelo , posted on 03 October 2023 / 10,350 Views
Square Enix in its latest earnings report for the second quarter of 2023 revealed revenue for the company increased 14 percent year-on-year, however, profits fell 65 percent.
Square Enix resident Takashi Kiryu in the earnings call with investors, reported by Bloomberg, revealed sales for Final Fantasy XVI "did not meet the high end of the company's expectation."
Kiryu said that the "slow adoption of the PS5" was a reason for the JRPG to not meet the high end expectations and that the end of shortages for the PS5 should help boost software sales.
The Square Enix share price has fallen since the earnings report with it being at ¥6,366 on the Tokyo Stock Exchange when it closed on Friday. It quickly fell Monday morning to below ¥5,500 and is now sitting at ¥5,561. This is the lowest the share price has been since May 2022.
Square Enix in June announced Final Fantasy XVI had shipped three million units shipped worldwide in about a week. The figure includes digital sales. This figure is down from Final Fantasy VII Remake, which shipped 3.5 million units in three days, as well as Final Fantasy XV, which shipped five million units in its first day.
Square Enix has stated that sales for Final Fantasy XVI are "extremely strong" when you consider the install base of the PS5.
"Taking into consideration the sales figures of the acclaimed Final Fantasy VII Remake and the difference in size of the install base of the PlayStation 4 at the time of this title’s release, we can see that the attach rate of Final Fantasy XVI is considerably high, given the PS5 install base," reads a previous statement from Square Enix. "Square Enix considers the initial sales results of Final Fantasy XVI to be extremely strong, and we will continue to carry out a wide range of initiatives to encourage even more people to play the game."
A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012 and taking over the hardware estimates in 2017. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel. You can contact the author on Twitter @TrunksWD.
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David Gibson, who actually attended the meeting, said that SE revealed that the results were within their expectations.
https://twitter.com/gibbogame/status/1688408499104178176?s=20
The article is claiming the game didn't meet high-end expectations. So FF16 has sold within the range they were expecting, but just not the upper limit of that range which is perfectly acceptable.
It is not.
The thing is that even if the numbers were good enough to make money out of it; this is one of the their main if not most important franchise (Final Fantasy) and this is why the stock went down, the latest AAA entry in the Final Fantasy franchise did not do so well and having high expectations for your main flag ship is just a base line...
This is the same as Halo Infinite for Microsoft. They did well, but they did not meet the high expectations and we are all agreeing that this is bad. Same goes for Final Fantasy or if a new main AAA Zelda entry would come out.
Exactly, I can't believe how much people its in denial about this. This type of project takes several years with massive (and always increasing) budgets. YOU DON'T make that type of investments to get some of the worst results ever for your biggest IP. It was to be expected that shareholders wouldn't be happy about this.
Nope, the reason for the stock to go down was other areas that weren't FFXVI.
Not only acceptable but expected. Whatever result you get should be near the middle of your target, if results are getting on either extremes (or even worse, out of it) you done a bad projection (which have been the case of SE several times before).
You dont make a flagship IP only to just profit on. They should be making a fortune on its release.
I think there are just too many great games this year, and gamers only have so much time and money to put into gaming. I still haven't gotten to Resident Evil 4 yet, I'll more than likely pick up Final Fantasy XVI around Black Friday or sometime next year.
I have ff16 and it's an okay game with technical issues . It's not as good as ff7r on ps5 in terms of gameplay and graphics
This sounds about right. To be clear they're saying it didn't reach the higher end range of their expectations, but not sure they should have anticipated an adoption rate much higher than 1:10. Even Ragnorok only sold around 4m 1st week on Playstation 5 (exlcuiding PS4 version). That's a franchise thats in its critical peak, versus the last 2 mainline Final Fantasy's which have had mixed reactions from fans (XV/XIII)
The bigger concern for them is not its launch week numbers which are actually good, but the weeks that followed, it hasn't lingered around the top 10 charts like other big Playstation titles (GOW, GT, Elden Ring, Hogwarts)
I think there's a risk it loosing its gameplay identity trying to appeal to the masses, whilst also appearing as unapproachable to casual gamers. Several friends of mine mentioned that they haven't played the others, so they're not inclined to play a game titled "16"...
Lastly they've been outcompeted this summer. I'm a diehard FF fan and I still haven't purchased it. Zelda is taking up my time. Add to it the fact that Ragnorok, Hogwarts & Diablo are all massive RPGs all still on the charts and I think there was a bit too much saturation
While I’ve only heard good things about it, I’m pretty sure the change in genre didn’t go over well in Japan. It has really poor numbers over there.
I’m not so sure about that, of it being a user base problem. It’s had one of the worst Final Fantasy mainline launches in Japan. And if anything, Japan buys consoles for a few key franchises pretty much always. Monster Hunter, Dragon Quest, and Final Fantasy. It’s obvious the genre shift has affected the sales over there.
When there's not a single PS5 game that's sold 300k LT in Japan and FF does it in one week, it does indeed paint the picture of a userbase problem. If there was other software we could point to, that'd help paint an issue with the shift in gameplay.
It could very well be that the action orientated gameplay alienates Japanese audiences but I think we'd need a bit more context to conclude that, FFXV was action, Monster Hunter is action, Kingdom Hearts is action..
Over 10 percent of Japanese PS5 owners have a physical copy of this game, at least 7,5% probably has a digital copy. That's an attachement rate of 17.5%, not really that bad. This is with the assumption that all of the 4.5 million + PS5's out there are actually owned by Japanese people and that not 1.5 million of those consoles are actually exported to China. It's also by far the best selling PS5 game in Japan (which isn't free to play at least).
Maybe if it would have more waifus, it would have sold better, this game has a severe lack of waifu compared to other final fantasy(even compared to ff xv)
The discussions here are a fascinating read.
I'm sure there are a lot of people in my situation, who wan't to play it, but playing catch up with other games.
Called it. Blaming this on the hardware is not a good move either.
It's about attach ratio, not raw numbers. So as long as the ratio was where it needs to be, there's no concern imo. Well, other than profits. But it sounds like Square is pleased with that, too.
Port it to PC, Xbox and Switch already and get more sales that way.
Eh, I'm looking forward to it coming to PC. Game of Thrones-style story with DMC combat? Count me in! I'm new to the FF franchise, so how much of a different path this title took to previous titles doesn't bother me none.
Will probably get a PS4 release.
Guys it just needs a PS1 release with a proper ATB system and renaming the MC to Cloud and replacing all the party members with Tifa, Barret etc , that along with a plot twist that sees the Cait Sith character killed and replaced by Wedge and Biggs .
That last part alone will get gamers talking and really build up the buzz and while it may not be their hand on the knife/ sword delivering Cait Sith's demise it will give whoever the XVI character living with the ignominy (the poor sod ) of being replaced by Cait Sith some satisfaction .
Believe me it will sell millions,no change that forecast since upon reflection the excitement meter has this selling billions.
Bought this game and boy, what a disappointment. The only good thing were the boss battles that were epic, but pretty much everything else sucked.
Characters are so bland and boring and without personality, no memorable characters except maybe Cid. And they talk and talk and talk and everything is so morally pure and mind numbing that nothing makes an impression.
Battle was flashy, but too complicated and yet too simple button mashing at the same time. The loot system is bland and terrible, the crafting seems an afterthought. Same goes for the side quests that seem to be just obligatory filler. Main story starts out OK, but then kind of becomes nonsensical. Environments are nice enough, but there's no sense of traveling and discovery, a journey. You don't even get to visit the the main cities outside of the main quests where you run through them once. Ugh.
Didn't have the feeling of Final Fantasy. I trusted the title too much, should have done my research.
Square is in such a sad state,
Always not meeting expectation with their recent releases lol
Some people want this game to fail so much lol
Bloomberg shit reporting to bait them for click probably
Hang on, they said before that it was selling well enough, so what's going on here now?.
Was it just a spin to begin with, or SE suddenly change their sales expectations within the last few weeks?.
Poor reporting from bloomberg "journalist"
Considering what BG3 is doing, Square needs a new strategy.
You mean selling less than 3 million at launch?
Considering its Squares biggest IP, that isnt exactly great.
It should be day one on PC. We have good taste there. :-)
But I have just checked, Xbox players for FFXV = only 11,4% of the sale... that's very low. I can understand that japanese don't care about Xbox.
FFXVI will still do FF's numbers : between 5 and 10 million with the PC version. Plus quality wise, many people told me it's better than FFVIIR.
Which one..since wiiu only sold what 14mill?
I think mario kart 8 sold/shipped between 7 and 8 million on wii u
maybe time to get back to roots and try a turned based numbered game?
Game sucked, DMC in FF clothing. Not surprised in the slightest.
Was pretty obvious to me the that the previous statement they released about the game exceeding expectations was PR spin. FF16 shipped 3m copies in the first week, FF15 shipped roughly 4.2m copies on PS4 alone in the first 24 hours (plus another 800k or so on XB1), and the install base comparison there was about 39.5m PS5 vs 49.6m PS4. There is no way they were happy with selling 1.2m copies less than the previous mainline Final Fantasy in 6 more days, even with that ~10m install base discrepancy, especially since 16 reviewed better than 15.
If the PS4 had a 49,6 mil to 39.5 mil advantage at the time of release, it had a 20% install base edge would put it closer to 3.6 million or a .6 million less copies if the install base was equal. They couldn't have released it at a worse time, many players were still playing Zelda when it came out, Diablo 4 came out a few weeks earlier, and Starfield is right on the horizon.
Pretty much, it was a well known fact since the beginning that the game underperformed. You don't release a major expensive game like this to have some of the worst sales of your 30+ years franchise.
They never said it exceeded their expectations, they said it was extremely strong considering the PS5's userbase. The actual quote:
"With 38 million PS5 consoles shipped globally (as of March 31, 2023), sales of Final Fantasy 16 surpassed three million units worldwide several days after its release on June 22, 2023. Taking into consideration the sales figures of the acclaimed Final Fantasy 7 Remake and the difference in size of the install base of the PlayStation 4 at the time of this title’s release, we can see that the attach rate of Final Fantasy 16 is considerably high, given the PS5 install base."
They actually haven't backtracked here
Thats what you get for money hattin'
This is exactly why they just signed deals with Xbox. Sony exclusivity is losing them money. Anyone wanting a struggling 3rd company to stay exclusive actually wants that company to fail.
PS don’t really care about square games myself.
