Sony Unloads 9.5 Million Shares of Square Enix, Future of Company is Uncertain

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UPDATE: Tech Radar mention has been rewritten for clarity. 

In an effort to cut costs, Sony has announced they are selling their entire stake of video game company Square Enix. The message was delivered yesterday on a very short press release written in Japanese and doesn’t delve into any details. Sony had been an investor in the video game developer since the early 2000s and owned 8.2 percent of the company.

The sale involves 9.5 million shares valued at $156 million. Sony is expected to profit around $47 million from the transaction but won’t get a clear picture of their financial situation until they release their fiscal outlook for 2015 at the end of May.

The revelation comes after Sony has spent the last couple of months streamlining its operations. Since the start of 2014, Sony has terminated its VAIO line of computers, laid off 5,000 employees, and entirely restructured its TV business. Most recently, Sony has shut down several of its most notable buildings — including their old Tokyo headquarters.

New York City's Sony Tower was sold for $1.1 billion.

New York City’s Sony Tower was sold for $1.1 billion.

Sony has blamed their struggles on their failing TV and PC businesses, but they are also falling behind in the console wars. According to TechRadar, the Xbox One out-sold the Playstation 4 going into this year and Microsoft claims 46% of the entire US hardware market share. This is a stark contrast to the days when the Playstation 2 dominated over 155 million households.

Sony has warned investors that they expect to incur a $1.1 billion dollar loss at the end of the year and their future could be in jeopardy. The once powerful tech giant hasn’t had a successful venture in years and there is speculation they will cut ties with several of their subsidiaries — most notably the beloved Walkman.

The Sony Corporation became an overnight sensation in 1979 when they introduced the world’s first portable music player, but subsequent failures proved to be very costly. Critics of the company believe they could have had a stronghold on the digital music industry, but waited too long to adapt. The result was Apple dominating the MP3 landscape with the iPod while everyone forgot who did it first.

Square Enix, best known for creating RPGs like Final Fantasy, Dragon Quest, and Kingdom Hearts, has yet to comment on the situation. But there are already rumors that this may be the final nail in the coffin for Final Fantasy which has been criticized heavily for its lack of improvement in recent games.

All of the original creators of the game are no longer at Square Enix and it’s been taking the company longer to produce titles. And now, without Sony’s backing, it may be even more difficult for the game developer to manufacturer the game.

This is a critical time for Sony and there is no way to predict what will happen to the company. But if video game history has taught us anything it’s that if you’re not number one, you’re in last place. Just ask Atari.

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61 Responses to Sony Unloads 9.5 Million Shares of Square Enix, Future of Company is Uncertain

  1. darquis April 17, 2014 at 3:01 pm #

    Not really clear how no longer having part ownership by Sony makes Square more or less able to make FF games – Sony’s ownership really had next to nothing to do with it, especially as these were multi-console games. Part of why they have longer release times is their focus on sequels and MMORPG FF games.

    • Swift April 17, 2014 at 3:37 pm #

      It’s more a sign that Sony is in trouble. Also, losing 10% of your net shares can reallllly damage a company. You’ll probably see some pending titles get dropped, in order to adjust for this.

      • Thanh N (@sirthanh) April 17, 2014 at 4:12 pm #

        How are they losing 10% of their share when Sony is selling the shares and not forcing Square Enix to buy them back. Do you know anything about stocks at all?

        • Jon Vance April 17, 2014 at 4:52 pm #

          Having 10% of your company’s shares dumped on the market all at once isn’t healthy. Their stock price is down from $34.95 to $17.57 in a very short period. That’s not easy to recover from, especially if you’re an ailing development studio with no prospects. Do you know anything about stocks?

          • D April 17, 2014 at 5:25 pm #

            Stock price has no impact on daily operation unless the company wants to issue more stock to raise capital. As the other post said, do you know anything about stocks?

          • Obiwan362 (@obiwan362) April 17, 2014 at 7:14 pm #

            Can you tell me when the price was $34.95? I can’t seem to find a point in the last 5 years where that was the price.

          • Mikey April 18, 2014 at 8:20 am #

            Well they are obviously restructuring the company by getting rid of divisions not making any profits. The stock can go back up if the restructuring works out. Many companies have recovered and doing very well after. Take a look at VeriFone (PAY) stocks. It’s probably a good move in the long run if the company didn’t meet their numbers this quarter.

          • Mike (@mikejcsauer) April 18, 2014 at 6:00 pm #

            Geez. Do ANY of you know about stocks? I can buy some stockings in Wal Mart if I really needed to for like 5 bucks.

          • BM April 19, 2014 at 4:09 pm #

            “Can you tell me when the price was $34.95? I can’t seem to find a point in the last 5 years where that was the price.”
            Last time it was at that price was ~$32 was in 2008. Recently, it’s been $27 (early 2014), but there was a recent sharp drop in the last few months. Looking at the 10-year trend, this is not exactly a hot stock (sporadic spikes, no constant gains).
            http://investing.money.msn.com/investments/charts?symbol=US:SQNXF#{“zRange”:”9″,”startDate”:”2004-4-19″,”endDate”:”2014-4-19″,”chartStyle”:”mountain”,”chartCursor”:”1″,”scaleType”:”0″,”yaxisAlign”:”right”,”mode”:”pan”}

          • seyjames April 21, 2014 at 9:09 am #

            I don’t mind admitting that I haven’t the slightest clue how stocks work… If one of the many ‘gurus’ here could break it down for me; should Square Enix throw the proverbial ‘Hail Mary’ and make the FF7 remake that has been talked about to death now? Could that save them?

          • Obiwan362 (@obiwan362) April 21, 2014 at 8:49 pm #

            Thank you for admitting you don’t have any idea how stock works. There is a lot more to stock than what I’m going to mention here, and some of it is oversimplified so I’m not writing a novel. Hopefully this answers your question though.
            Essentially, companies sell a certain number of shares in order to raise money for the company. After the company has sold the stock, the market can buy and sell that stock as it wishes. The important thing to note is that once the company has sold the stock, what happens to stock prices, or even if someone sells a massive amount of the stock, does not necessarily have a direct impact on the company. There are few scenarios where low stock prices will be detrimental to a company. The most likely worst thing that happens from stock price dropping is the board of directors for the company would want the company to do something to restore the public’s faith in the company. To that end, announcing a FFVII remake, whether it would be a good idea or not, would likely generate enough buzz that it would increase stock prices, though probably only for the short term.

      • UnstableCatalyst April 19, 2014 at 1:15 pm #

        Do any of yall know about stocks? 10% of 9 is 2 divided by company dividends and dished into Square Enix = trifecta – 0.2 so basically sony is all good

    • Tony Brutsman April 18, 2014 at 3:43 pm #

      The only multi console games were D’s titles and one other game. L2 video games

    • Kyle Evans April 19, 2014 at 7:26 pm #

      I was just thinking the same thing. Ownership of stock in a company does not mean a constant flow of money to the company the stock represents. Stock purchases are one-time transactions, not contracts of flowing income. Sony selling their stocks in Squeenix will have absolutely no financial impact on their game development processes at all….If Sony HAD had anything to do with Final Fantasy’s development processes, it would have continued to be exclusive to Playstation instead of branching out to multiplatform as soon as another viable platform came to market.

  2. Ryan April 17, 2014 at 3:07 pm #

    Where did you get that XBOX One is out selling PS4? EVERYONE else says that the PS4 is BY FAR outselling the One. Is this article even legitimate?

    • Paul April 17, 2014 at 4:17 pm #

      It was just at the beginning of the year. Sony has out sold it since then.

      • Kryptography April 17, 2014 at 5:05 pm #

        The XBO is not outselling the PS4. It briefly outsold the PS4 in America in a specific month, however it has never been ahead in total sales in the US and is way, way behind in the world. It’s over 25% behind. Sony is well positioned to win this generation.

        This article wants to carry the narrative of OH NO SONY IS IN TROUBLE so all of the facts it reports are skewed to fit that story. Journalism is such a joke.

    • grndzro April 17, 2014 at 6:34 pm #

      Yea lol this gave me a chuckle. Especially when MS has NEVER stated how many consoles it sold to actual customers.
      Very bad journalism.

      • lolps4fanboys April 18, 2014 at 11:50 am #

        fanboys only see one thing, ps4.. not the company in its entirety. Microsoft is a juggernaut on all fronts. bad fanboys being bad

        • Tony Brutsman April 18, 2014 at 3:51 pm #

          You make an account on an awful site just to troll. You’re not even a good troll. QQ newb

    • druvirus April 18, 2014 at 11:47 pm #

      Their phrasing is entirely misleading, true. XBO is not outselling PS4 overall, .. but they did outsell them for a particular month coming into the new year, which is what they were inferring according to the link.

  3. J Dubious April 17, 2014 at 3:18 pm #

    If ever Square needed to release a FF7 remake, nows the time.

    • Ashley April 17, 2014 at 4:36 pm #

      I second this. They would make back the money used to make it in no time.

    • DerpMcGerk April 17, 2014 at 11:47 pm #

      Please stop with this. Remakes (especially one of this game and the impending rabid fanboyism) are part of what’s making gaming today damn near intolerable. The world needs new IPs, not a spruced up version of your childhood favorite.

      • shane April 18, 2014 at 10:15 am #

        That’s where you are wrong. SE has made several new FFXI games and they have failed miserably. You might think it’s a had idea but they would sell more copies of the game than anything they have made since it’s release. If you want new ISP than the company needs to make a profit. FF7 will make a profit. Furthermore the game is 20 years old and there are millions of gamers who were not even born when it came out so it could still draw a new audience. On another note a remake of the game could also help developers reconnect with what made FF so great. FF14 bombed and a lot of those mmo players went back to ff11 which is now a 11 year old game. If it’s not broken don’t fix it…..
        SE is broken time to go back 2 their roots.

        • druvirus April 18, 2014 at 11:46 pm #

          Yes, it’s time to go back to their roots; not rehash the same shit over and over again with HD versions. FFVII itself is so divisive that it’d be impossible to do. In order to keep it aligned to today’s market they would need to do more than just spruce it up … they would have to rehaul everything. From graphics to mechanics to gameplay to quests to the world itself. Everything would have to change. And once it did, you’d have millions of angry fans who would yell about how SE ruined their favorite game. There is no way SE would win with an HD remake of FFVII.

        • lionhart12 April 19, 2014 at 5:56 am #

          It’s true that a remake would be profitable but seriously in this generation of gamers they would very much prefer better graphics better gameplay not some oldschool classic game being remake…. if the kind remake would be changing the gameplay of FF7 like turning it into a fast action paced game would be nice but we should let those old school games to rest and focus on making something new that can surpass those old ones, dont be mistaken though i am an old FF fan and played almost all FF series and i’ve always want to have a remake in FF9 and 8 and also in my opinion FFXIII is kinda a letdown and it’s sequels… but it’s just a one guy’s opinion… SE is (yeah) broken but returning to it’s roots is not a good thing a company should not look into it’s previous successes but focus on making something new….

        • GetPunched April 19, 2014 at 6:44 am #

          Square has already said they wont remake ff7, or any other early titles. Ever wonder why RPGs went from 40 to 100 hour play times to 20? The amount of time and money it takes to make a game of the graphical quality we are accustomed to today makes it impossible for Square to take a game the size of FF7 and remake it to modern standards without sacrificing a lot of story. Which they will not do.

    • Mike (@mikejcsauer) April 18, 2014 at 6:01 pm #

      Please…stop with this…

      They have commented on this multiple times… a FF7 proper remake would take almost a decade due to the size of the original game.

  4. Riley April 17, 2014 at 3:26 pm #

    Love the use of a single months sales data to claim sony is losing the console wars this time. To date Sony PS4 has outsold Microsoft XboxOne 2.5:1. 7 million for Sony, the best start for any console in the last decade.

  5. Ian April 17, 2014 at 3:33 pm #

    XBOX One has not outsold PS4 this year or overall. XB1 had a brief lead in December, but not since, and it even states as much in the Techradar article linked to here (which is three months old now).

  6. Ivan B. April 17, 2014 at 3:44 pm #

    Tech Radar mention has been rewritten for clarity.

    • blindrocket April 17, 2014 at 5:29 pm #

      It was ignorant to even bring up that article from a few months ago. Why not talk about the current trend?
      And then you mention Atari at the end, a company that hasn’t been relevant in the console market for decades.
      This is just terrible, terrible, article writing.

  7. YuLie IvanB April 17, 2014 at 3:52 pm #

    Wooow, where do you get your facts Ivan B.

    Are you a Xbox fanboy or what? Anyone who puts in even a small amount of effort can see that PS4 has been outselling Xbox nearly 2:1 since the launch. You are blatantly lying in this article to try and get some click bait and its pathetic.

    You’re linking an old article from TR and even in there it says blatantly that the PS4 is outselling the Xbox.

    Way to try and lie to your readers, real classy.

    • Ivan B. April 17, 2014 at 3:57 pm #

      From the article I cited: “NPD Group figures reveal 908,000 Xbox One units sold last month in the US, making it the best selling gaming gear stateside.”

      By writing “going into this year” I meant the Xbox One outsold the PS4 in the final month of last year.

      And no, I’m not an Xbox fanboy. I’m more of a Nintendo guy.

      • Vincent Cunningham April 17, 2014 at 4:13 pm #

        Personally I still think it is somewhat misleading. Perhaps I’m just not familiar with “going into this year,” implying things that only happened in December rather than cumulative throughout the previous year.

      • MQ April 17, 2014 at 4:13 pm #

        “Sony… are also falling behind in the console wars”

        http://www.gamesindustry.biz/articles/2014-04-17-titanfall-tops-chart-but-ps4-leads-hardware-again-in-march-npd

        http://www.extremetech.com/gaming/180762-ps4-sales-pass-7-million-units-while-xbox-one-licks-its-wounds-and-plans-a-comeback

        You should probably be looking at more recent news instead of 3-month old stuff.

      • KC April 17, 2014 at 7:07 pm #

        So if Nintendo out sold everyone for one day, on the last day of December, they would have been the leading console “going into this year”? By using that phrase, it was not clear if you were referring to the whole year, what time frame, etc, which put the PS4 in a much poorer light than the XB1. Not sure if that was your intention or not, it that is what the readers picked up on.

      • shane April 18, 2014 at 10:21 am #

        I have all 3 system and i don’t care who outsells who because in the end if you are gamer who wants to play every great game you will get all systems. The people who keep arguing Sony sold more blah blah are just fan boys in denial.
        All i can say is i use my xbox1 everyday because of the extras. Neither system has yet to put out a game that i want to play all the time. My PS4 is collecting dust at the moment. Xbox1 would be also if the kinect wasn’t so awesome.

        • Shane doesn't understand what denial means April 18, 2014 at 6:54 pm #

          The PS4 is heavily outselling the XBO, even in the US. I’m not sure what there is to be in denial about.

          Also not sure of the relevance of you using one over the other.

        • Matthew Bryant April 28, 2014 at 3:09 am #

          “Xbox1 would be also if the kinect wasn’t so awesome.”

          Said no sane person ever.

      • Matthew Bryant April 28, 2014 at 3:07 am #

        I’m guessing you did zero research for this article. The PS4 is currently outselling the Xbox One by at least 3:2, and possibly 5:3 worldwide. Did you even try to google the two consoles? A simple search would bring up about 50 articles on how the PS4 is currently destroying the Xbox One. No offense, but you obviously have an agenda. Either that, or you shouldn’t ever write another article until you learn how to properly research. Especially since the PS4 was STILL outselling the Xbox One during the holidays worldwide. Learn how to be a journalist. Thanks.

  8. Vincent Cunningham April 17, 2014 at 4:01 pm #

    “In a statement picked up by CVG, SCEA Senior Director of Corporate Communications Dan Race pointed to the PS4′s global sales lead and cited short inventory for a poorer US December showing.
    ‘PlayStation 4 remains the cumulative leader for next-gen console sales in the US since the launch on November 15,’ Race said. ‘We sold every PS4 available at retail in the US and were out of stock in December due to overwhelming consumer demand.’
    Sony announced on January 7 that it sold 4.2 million PS4s globally as of December 28, 2013. Microsoft put on record January 6 that it sold three million Xbox Ones worldwide last year.” (That same TechRadar article)

  9. Sid April 17, 2014 at 4:04 pm #

    Stick to selling PC hardware please.

  10. Alan April 17, 2014 at 4:54 pm #

    Good, Square Enix is a bunch of cheating crooks. They sold my Final Fantasy 11 account twice so they can profit $50 off my account and then voided my game keys so they would profit more than $200 off the PS2 game and HDD or $60 off the computer version by forcing me to purchase the game again and start from Square One.

    • Kaido April 17, 2014 at 8:50 pm #

      Haha. /Square/ one. GET IT!?

    • afatalpapercut April 18, 2014 at 3:37 pm #

      I had the exact same thing happen to me twice on PC and once for the version that came out on the 360. The only company I’ve known to do that. Don’t log in for a couple months and your account is inactive to the point of you needing to purchase the game again…couldn’t just resubscribe. I gave up on it…

    • Matthew Bryant April 28, 2014 at 3:13 am #

      Not calling you a liar or anything, but I accessed FFXI off and on for a good 5 years without any problems…

  11. Erwin April 17, 2014 at 9:24 pm #

    So is anything written heretrue or is just the stuff about sold units false.
    I really want to know as I liked Sony as a company, their walkman players offered actual sound quality compared to what Apple’s iStuff does.
    Too bad that SE is so shitty in the recent years and everything thanks to a certain CEO, which they fired after he destroyed everything and then gave a new job not even a month later.

    Well if this stuff here is true they might focus more on their military work, after all they make most of the sensors that are used in the US military camera’s, like in the Apache.

  12. Talan April 17, 2014 at 9:36 pm #

    Hey Newegg, if you’re going to have some fanboy give Microsoft a ****job then look elsewhere for customers. I’m “unliking” this garbage. Try justifying your stupid statements instead of writing a MSFT advert. Not one website in the legit web says X Box One is outselling PS4.

  13. Khalid Ali April 18, 2014 at 4:57 am #

    The PS4 is demolishing the Xbox One in sales.. please use current market trends rather than something that’s several months old

  14. drhilarious April 18, 2014 at 1:14 pm #

    Poorly researched article. Console sales have nothing to do with the company’s finances nor are they “falling behind in the console wars.” They are pretty much only making money from their entertainment divisions, leading the console wars by a fair bit and keeping momentum, unlike the Wii U at second place. The very opposite of what you wrote. They are right to get out of the PC business as it is dominated rightly by those who focus on it. They are right to restructure their TV business as Samsung, LG, and Vizio dominate the market. They are right to sell their real-estate if they can’t afford it. Their music and movie business are doing extremely well as they are one of the biggest labels and studios. They would be right to get rid of Walkman or to turn it into a line of smartphones or iPod Touch competitors using Android as an OS.

    They are clearly focusing on fewer quality products instead of being a jack-of-all trades master of none electronics giant. Their new smartphones and the PS4 show they can make quality products in the modern industry. Their hardware design shows they can make attractive products. Their advertising and PS4 sales show they can market a product even with little content. They are likely to focus on making good products that access their content and the content of cooperative third parties; TVs, game hardware, smartphones (maybe tablets) accessing movies, TV shows, games, and music.

    More focused companies are more successful in the long run. Microsoft is focused on software. Nintendo is focused on games. The former is consistently profitable despite losing money on their console business and never being ahead in any console war. The latter has a lot of financial resources from previous success despite losing money three years running.

  15. Dude April 18, 2014 at 3:44 pm #

    ^^^^

    What he said.

  16. matt ballz April 19, 2014 at 4:33 am #

    Who gives a ****? Really. By this point, those of us who can afford a current gen console have made our choice. “Omg, your facts are wrong, Sony blah blah blah. And people talking about whos winning the console war are idiots. The last generation of console lasted 9 years, current gen is only 6 months in, no ones won anything. The point of this article is more about the assets sony is selling, not the success of you fansboys precious ps4.

    • Matthew Bryant April 28, 2014 at 3:17 am #

      Except that the current success of the PS4 has quite a lot to do with the success of Sony in the near future. Currently, Sony is having a very good year. Your comment seems pretty ridiculous given that fact…

  17. christian page (@chris8bit) April 19, 2014 at 9:12 am #

    so all you saying sony is wining because they have more sales believe nintendo one the ps3,wii,360 war right?
    well the wii far out sold the other two
    stop making up fake reasons why one side is winning.
    the winner will be known later down the line.
    and there is a different between the company winning and the fans of the company winning

    the company wins when they make a large profit on it. it dose not matter anythiong else

    fans win when they get something really good well worth their investment
    so far neither the one or ps4 have won in eather way

    • Matthew Bryant April 28, 2014 at 3:19 am #

      Nintendo made the most profit last generation by a considerable amount. Sony is currently doing much better this generation than the other two. Did you have a point? Or do you just hate Sony for no particular reason?

  18. capsulef April 19, 2014 at 5:38 pm #

    This is the most biased garbage article I have ever read. Go to vgchartz if you want the real story. PS4 has sold close to 3 million more consoles than x box one.

  19. RBBrittain April 21, 2014 at 10:17 am #

    It’s more about Sony than Square Enix; they’re hurting so badly in TVs & PCs that they’re having to cash out their lesser game investments to keep the doors open. If not for the PS4 (and PS3) being dominant in a gaming market that’s hurting overall, they might be toast.

    • Matthew Bryant April 28, 2014 at 3:21 am #

      You do realize that Sony still has considerably more first party game developers than Microsoft right? Just making sure…

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