Square Enix wants to create “global hit titles” and believes blockchain will “play a key role in future growth”

In a financial report confirming that Square Enix has “set new records for full-year net sales”, the Japanese company says it wants to “improve [its] presence in the global market” given the “greying demographics” of developing games primarily for the Japanese market.

In the statement, Square Enix said it was “critical to [its] business which [it] produce hit titles that speak to the global market”.

“In order for our group to better focus on developing titles for the global market in this changing environment, we need to concentrate our limited resources on developing strong and robust titles,” the company said.

“We need to strengthen our presence in the global market by quickly establishing an organizational structure that enables us to consistently roll out high-quality content produced through selective and focused resource allocation, which requires upgrading our title and studio portfolio.

“Achieving major growth in the games industry is difficult now for companies primarily competing in the Japanese market, given their graying demographics. As such, it is critical to our business that we produce hit titles that speak to the global market, offering greater scale both in terms of customers and sales volume,” Square Enix added (thanks, NME).

“In other words, the Japanese market is no longer sufficient to achieve a level of earnings that enables us to recoup our development investments and generate profits, and we must therefore approach our development efforts based on the assumption that we must succeed in the global the market.”

President Yosuke Matsuda further added that he believes “blockchain entertainment” will “play a central part of [SE’s] strategy for future growth”, adding that the company had “identified AI, the cloud and blockchain as focus investment areas”.

Just weeks after confirming that it was selling its Western studios and IP to Embracer Group for $300 million, Square Enix revealed plans to “establish new studios” and acquire others.

The news came as part of the company’s recent financial presentation, which revealed that one of Square Enix’s “medium-term business strategy” initiatives is to “enhance game development capabilities by establishing new studios, [mergers and acquisitions]etc.”

The company said the “goals behind the divestment of selected overseas studios and IP” — i.e., the reason it sold its three Western studios — were to “achieve sustained growth through selection and concentration of company sources, better align overseas publishing functions with organization in Tokyo, and transform the group’s business portfolio”.