Square Enix has posted its latest financial results, and it doesn’t look great for Marvel’s Avengers.
The Japanese company announced its financial figures for the six month period to 30th September 2020, and while revenues and profits were up versus the same weak period in 2019 (Square Enix released Final Fantasy 7 remake earlier in 2020), the quarter during which Marvel’s Avengers released saw a £36m loss.
The part of Square Enix’s business we’re concerned with here is called “Digital Entertainment－HD Games”.
The company did not say how many copies Marvel’s Avengers sold, or commented on its performance. But Crystal Dynamic’s troubled adventure comes out poorly when we compare the two quarters of the current financial year.
In the first quarter of the 2021 financial year, when Final Fantasy 7 remake came out, the HD Games division saw net sales of ¥34.1bn (£250m) and an operating income of more than ¥10bn (£73m). That’s a tidy profit for the period.
Then we have the second quarter of the 2021 financial year, during which Marvel’s Avengers came out. For this period (the beginning of July to the end of September) Square Enix’s HD Games business saw net sales of ¥23.7bn (£174m) and an operating loss of more than ¥5bn (£36m). That’s not great.
It’s hard to get a handle on exactly how badly Marvel’s Avengers missed its sales target by, but it’s clear the game hasn’t done the business for Square Enix. In a tweet, Tokyo-based video game analyst David Gibson said “volumes were 60 per cent of plan”, and Avengers had sold “only 3m or so”.
In early October, Crystal Dynamics said it was working on new updates for the game “as fast as we safely can” in a bid to reignite waning player interest.
At the time, SteamCharts numbers suggested the game’s PC audience had slumped to between 1000-2000 people a month after launch – low enough to trigger matchmaking issues. At the time of this article’s publication, just 798 people were playing Marvel’s Avengers on Steam.
In mid-October, Square Enix and Crystal Dynamics delayed the PlayStation 5 and Xbox Series X versions of Marvel’s Avengers until an unknown date in 2021.
Until that point, you can play the game via backwards compatibility, although of course this won’t be possible for those with copies of the game on disc who have bought a PlayStation 5 Digital Edition or Xbox Series S.
“We’ve made the decision to shift our PlayStation 5 and Xbox Series X|S launch to next year to ensure that we give our team the time to deliver a next-gen experience showcasing all that this game is meant to be,” studio boss Scott Amos said.
It’s a rosier picture elsewhere at Square Enix. We’ve already mentioned Final Fantasy 7 remake, which looks like it drove a significant profit at the HD Games business. In the company’s MMO segment, Final Fantasy 14 saw a rise in operating income year-on-year due to a growth in monthly paying subscriber numbers.
Overall, for the six months ending 30th September 2020, Square Enix saw revenue up 43 per cent, and profits up 46 per cent. The company shifted 12.08m copies of new games during the period, compared to 8.65m copies in the same period last financial year. The split between physical and digital is pretty much even.