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Submitted by oof46 1052d ago | news

Square Enix restructuring as Tomb Raider and Hitman sales fall short

Developer and publisher Square Enix has changed its positive predictions for the current financial year from a healthy profit to a crippling loss, and announced plans to bring in expensive reforms and restructuring. Sleeping Dogs, Hitman Absolution, and Tomb Raider all failed to meet high sales expectations. (Hitman: Absolution, PC, PS3, Square Enix, Tomb Raider, Xbox 360)

oof46  +   1052d ago
It's amazing how Sleeping Dogs, Hitman Absolution and Tomb Raider are expected to sell 1.75 million, 3.6 million and 3.4 million copies respectively by the end of March and they are considered failures.
zeal0us  +   1052d ago
SE set their sales expectations way too high. They should be satisfied with the sales figures. This almost remind me of Capcom not being satisfied with RE6 sales even though it sold millions. Not only Capcom but EA was unsatisfied with Deadspace 3 sells even though DS3 sold millions as well.

Companies these days really need to lower their expectations some and learn to be satisfied with what they got.
first1NFANTRY  +   1052d ago
I agree, last gen during the ps2 era when a game sold 1 mill it was considered a major success. All of a sudden companies expect to do cod numbers? sorry not gonna happen.

Especially in these times where gamers vote with their wallets. A great game will sell. If it doesn't then devs need to start asking themselves what they did wrong and how to better their next project.

Oh and Microtransactions and a price increase in games will only make things worse for them.
amaguli  +   1052d ago
It's not just high expectations, but also really high budgets. The average triple a game today costs $20-$25 million to make, whereas last gen it was around $1-$4 million.
abzdine  +   1052d ago
these sales numbers or expectations dont come by luck because someone decided to be that amount and not another, there are quite complete tools to prevent and expect things like this based on the market shape, the product, development expenses, the nature of the product... There is an averagee xpectation which is the ones they are giving and they also have a minimum expectation they HAVE to reach to stay alive and they apparently didnt reach it.

It means, as i wrote below, that their whole politic of focusing and relying on western titles is rotten and they have to revive their BIG names that used to sell like hot cakes 10 years ago
MikeMyers  +   1052d ago
It just shows how expensive making these games are now including marketing. I imagine when Tomb Raider first came out the team behind it were much smaller and advertising cost much less.

It's no wonder why they create DLC and other online incentives to try and get more money out of you.
#1.2 (Edited 1052d ago ) | Agree(3) | Disagree(2) | Report | Reply
AKS  +   1052d ago
That figure was also qualified by the phrase "Excluding digital sales...," which is how I bought all 3 of those games.

Squeenix has the highest salaries of any publisher of video games.

I'd like to see what proportion of those hefty salaries is going to the top few executives.
#1.3 (Edited 1052d ago ) | Agree(0) | Disagree(0) | Report | Reply
Agent_hitman  +   1051d ago
I believe it has to do with the production cost.. It didn't meet the sales expectation.
Outside_ofthe_Box  +   1051d ago
***"It's amazing how Sleeping Dogs, Hitman Absolution and Tomb Raider are expected to sell 1.75 million, 3.6 million and 3.4 million copies respectively by the end of March and they are considered failures."***

Wow that is amazing, especially TR. TR came out not to long ago and is expected to sell 3.4 million by the end of March and yet it's still under expectations? How much did they expect it to sell? 4 or 5 million in mere weeks?

SE needs reconstructing alright... reconstructing their ridiculously high expectations that is... I'm not even going get into JRPG side of things lol.
AusRogo  +   1052d ago
Both are great games and sold decent! Not every game needs cod numbers. ..
creepjack  +   1052d ago
The bottom line is, if those sales numbers aren't high enough to sustain business, then they do need a major restructure. Most companies would LOVE to have numbers like those. There has got to be a whole lot of mismanagement going on.
abzdine  +   1052d ago
Square relying on western games to save their asses, this is the thing i would never imagine 10 years back.

Now that bastard wada is out, they MUST use phoenix feathers to revive their top J-series.

Give us a Secret of Mana on Vita, release FF Vs13, sign an agreement with Level-5 for a new home console Dragon Quest, make a next gen Parasite Eve in the same spirit as the first two, stop pulling their pants down everytime MS signs a paycheck to get exclusivity, we can all now see this practice didnt bring them any good, especially when you realize how poor their big franchises became.

They came to the point where a FF just by name doesnt sell anymore because people dont buy a FF blindly like they did some years ago. We need real proofs of change, and we, oldschool fans, will follow and be happy to help
#4 (Edited 1052d ago ) | Agree(12) | Disagree(1) | Report | Reply
Blank  +   1052d ago
Damn nice comment but its a shame square enix dont listen to people like you when they really should you got an intelligent bubble from me
StrongMan  +   1052d ago
Tomb Raider and Hitman co-op coming up!

99% of multi plat games don't sell and the 1% that do sell don't sell enough to make any money. This is a problem.
kenoh   1052d ago | Spam
kevnb  +   1052d ago
i think this shows whats wrong with the console market. When 3 million copies sold is a failure I think publishers should reassess what they are doing.
The console retail model is broken beyond repair at this point. Publishers are starting to put out games that retailers will buy in bulk and throwing them in a bargain bin. Good games like tomb raider are getting bought, but retailers are buying less of them compared to other crappier games. They do this to get you in the store and buying other items with higher profit margins.

Investors want these incredibly expensive games and sequel after sequel... its going to crash.
#7 (Edited 1052d ago ) | Agree(1) | Disagree(0) | Report | Reply
Hanso  +   1052d ago
it will only get worse from now all the grafic whores are to blame
new greafics- higher cost to produce
by the time the ps 6 hits i guess 65% developers studios will be dead
elda  +   1052d ago
I don't get how Hitman & TR sold as a failure selling 3.4 million copies,Square stated TR cost 100 million if it sold 3.4 million copies at 60 dollars a game it seems like they had to make around 200 million getting their 100 million back with a 100 million profit,maybe figures are done differently??
#8 (Edited 1052d ago ) | Agree(0) | Disagree(2) | Report | Reply
Baka-akaB  +   1052d ago
They certainly wont get 60$ for each game to begin with . A big cut will go to manufacturing , shipping and retail
tigertron  +   1051d ago
Foolish company is foolish.
KittyEmperor  +   1051d ago
A positive note from this is that Wada is stepping down. So hopefully that means that this new guy that is taking his place can get SE's rpgs back on track. I think that the new person has been with the company since 2001 so hopefully he knows what he is doing.
oof46  +   1051d ago
I wonder if Squeenix is a top heavy company? How much do the top cats in the company make in comparison to their peers?

We also need to take into account that making games is not cheap. Going by development and marketing alone, it's safe to say that Squeenix spent roughly $150 - $200 million on Tomb Raider alone.

When one game fails to meet sales expectations, those expected sales are passed to the next game, which puts pressure on every other game released to make up the slack (ala Medal of Honor: Warfighter and Dead Space 3).
SephirothX21  +   1051d ago
Right now, there are a lot of great games to play on all platforms and due to the world economy, people don't have as much money now in developed countries.

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