Square Enix lost $200 Million on the Marvel Games, Analyst Reports

Square Enix has lost a grand total of $200 Million on its Marvel games i.e. Marvel’s Avengers and Marvel’s Guardians of the Galaxy, in less than two years, says David Gibson, Senior Analyst at MST Financial. Moreover, he cites this as the reason Square Enix decided to sell off its Western studios that were involved in the development of both Marvel IPs.

Gibson found the $300 Million acquisition deal to be a strange move, as the company wasn’t in need of the money. Instead, this was likely a bailout strategy to prevent the company from losing further financial resources on both the Avengers and Guardians of the Galaxy IPs.

Marvel – that’s the reason why Square sold its NA team for $300m. Because in a little under two years they lost $200m on two Marvel games. But it still looks like a low price given the optionality on probably 4 AAA titles coming through. #SquareEnix #Embracer

— David Gibson (@gibbogame) May 2, 2022

Meanwhile, Square Enix is planning to expand into new businesses moving forward, with investments in the blockchain, AI, and Cloud sectors. The company has restructured itself going forward, with its development studios now including its studios in Japan, Square Enix External Studios, and Square Enix Collective.

Not all of the company’s Western projects have led to a financial loss, however. Outriders, for example, was met with great success, and continues to do so with its first major expansion. It opens up the possibility of more expansions in the future, as well as the likelihood of a sequel.

For the uninitiated, Outriders is a third-person shooter that incorporates role-playing game features. Players build their own characters at the start of the game and pick from four classes, each of which has its own set of skills that may be used by the players. These unique abilities have a short cooldown time and may be paired with other abilities to get the most out of them. A talent tree is included in the game, allowing players to acquire and enhance their abilities. The game was game developed by People Can Fly and published by Square Enix Europe. It was released on April 1, 2021 for Windows, PS4, PS5, Xbox One, Xbox Series X/S, and Stadia.