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Square Enix Just Collapsed...

Updated: 4 days ago

Square Enix Announces Layoffs in the US and Europe Amidst Major Restructuring Efforts

Square Enix has announced significant layoffs affecting its US and European divisions as part of a broader restructuring initiative.

This decision comes amidst efforts to revitalize the company's operations and address disappointing financial performance.

Details of the Layoffs

Per VGC, In an internal meeting held on Monday, Square Enix President Takashi Kiryu informed staff about the impending layoffs, which are set to occur over the next month. Although the exact number of affected employees has not been disclosed, it has been confirmed that the layoffs will impact those working in publishing, IT, and the Collective indie games division.

Impact and Timeline

Employees affected by the layoffs will be notified this week. In the UK, staff will enter a one-month consultancy period in accordance with local employment laws, while US-based employees may leave their roles by June. Following the announcement, several of Square Enix's main Slack channels were locked.

Financial Context and Strategic Shift

The layoffs coincide with the release of Square Enix's quarterly financial results, which highlighted the company's intention to "rebuild overseas business divisions from the ground up" and optimize costs in its European and American offices. This restructuring is part of a larger effort to reverse recent disappointing sales of major titles. Many folks are reading into this that restructuring is another word for 'failing'.

Kiryu, who assumed the role of Square Enix's president in June 2023, has been leading a comprehensive reorganization of the company's development strategies. This includes promoting a new group of creators to executive positions in Japan and implementing checks on producers' influence over individual projects.

New Business Strategy

Square Enix unveiled a new medium-term business plan titled:

"Square Enix Reboots and Awakens"

This plan outlined a three-year strategy aimed at fostering long-term growth by adopting a multiplatform approach for AAA games - and getting away from all the console exclusivity. The company's latest financial results revealed nearly a WHOPPING 70% drop in profits compared to the previous year, attributed in part to a significant loss on the disposal of content.

The new strategy emphasizes the importance of multiplatform releases, including support for Nintendo platforms, PlayStation, Xbox, and PCs. By expanding the availability of its major franchises and AAA titles, Square Enix aims to reach a broader audience and enhance customer engagement... Makes you wonder why they went exclusive in the first place. The money must have been good for an exclusive contract at the time, but not anymore...

Future Outlook

While recent Final Fantasy titles such as Final Fantasy 7 Remake (fantastic game, btw) and Final Fantasy 16 were launched as PS5 exclusives, the new strategy suggests a shift towards multiplatform releases to better align with the company's future goals. This move is intended to mitigate the risks associated with platform exclusivity and leverage the strengths of internal development teams.

Square Enix's commitment to restructuring and strategic realignment reflects its attempt to HOPEFULLY overcome recent challenges and position itself for sustained growth in the evolving gaming landscape. Time will tell, but from where I'm standing, the entire video game industry has a long way further to fall before it finds a bounce.

I hope I'm wrong...

Thx to VGC & Bloomberg for the heads up/info!


1 comentario

Hey Sony. Instead of releasing twelve different versions of an overhyped/overdone game from 1997, try creating a diverse portfolio of content that caters to a broader spectrum of players. Then maybe you'll have, you know, money.

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