Square Enix takes ‘extraordinary loss’ of $33m for Luminous Productions

Square Enix Luminous Productions

For the six-month period ending this past Sept. 30, Square Enix has announced that the company has taken an “extraordinary loss” of 3,733 million yen, or just shy of $33 million. They are saying the loss is a consequence of setting up Luminous Productions, which was established back in March to develop AAA games and innovative game experiences. What exact titles the studio is creating is still unknown, but this certainly serves as a reaffirmation that AAA development isn’t cheap. The most pertinent piece of the short press release is below:

Having conducted an in-depth review of the business strategy for Luminous Productions Co., Ltd., a wholly-owned subsidiary (the “Subsidiary”), the Company had decided to focus the Subsidiary’s development efforts on large-scale, high-quality AAA game titles, which best leverages the Subsidiary’s strengths. This decision has resulted in the booking of an extraordinary loss amounting to 3,733 million yen, including the disposition of the portion of the content production account related to the game titles under development at the Subsidiary and impairment losses on intangible assets, in the Company’s financial results for the six-month period ended September 30, 2018.

I have a tragic hunch that the games Luminous Productions are making will never release for Switch (unless maybe Panic Button says otherwise). The best indication of this is how 2-year-old Final Fantasy XV only ever made it to Switch via the downgraded Final Fantasy XV: Pocket Edition HD.

Still, graphics aren’t everything. Square Enix showed this year that they can still deliver dynamite entertainment in a simple package with their 2D-HD Octopath Traveler, the best RPG available for Switch so far. If I could choose between one new AAA Square Enix title for Switch or three new 2D-HD titles, I’d take the latter, personally. Besides, I feel like graphics are reaching a point where the differences between one game to the next–or even one console generation to the next–are minimal. The leap from Nintendo 64 to GameCube was huge graphically. But the leap from Wii U to Switch, or even from PlayStation 3 to PlayStation 4? Eh, nothing that remarkable.

Anyway, what do you think of Square Enix’s decision to bank on Luminous Productions? Is it only natural for Square to keep trying to lead the pack with graphics, or do you think this is becoming an outdated strategy in a changing business climate? Let us know down below!

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John Friscia
Head Copy Editor for Enthusiast Gaming, Managing Editor at The Escapist. I'm a writer who loves Super Nintendo and Japanese role-playing games to an impractical degree. I really miss living in South Korea. And I'm developing the game Boss Saga!