Investor Relations

Summary of the 39th Annual Shareholder's Meeting by SQUARE ENIX HOLDINGS CO.,LTD. held on June 21, 2019

Summary of the 39th Annual Shareholder's Meeting by SQUARE ENIX HOLDINGS CO.,LTD. held on June 21, 2019

Summary of Questions and Answers:

You are guiding for FY2020/3 net sales and operating income on par with those of FY2019/3. However, it seems that your performance thus far has been strong, especially in the MMO sub-segment. Is there no chance you will be raising your guidance soon?

We need to carefully assess sales trends for our forthcoming titles as well as for catalog titles and therefore have no notion at present to revise our guidance.

You say that you will achieve your medium-term earnings targets (net sales of ¥300-400 billion, operating income of ¥40-50 billion) in FY2021/3, but is that based on there being major title launches that you have yet to announce?

Our current development pipeline is strong, and if those titles are launched according to plan, we believe we will be able to achieve our medium-term earnings targets. Please look forward to forthcoming title announcements.

You posted the presentation materials from your May 13 earnings briefing to your website the same day, and then you posted a summary of the briefing and the Q&A session on June 4. In the interim, your share price rose considerably. Is there any way you disclosed information about titles at the briefing that was not reflected in the June 4 summary?

The presentation and Q&A session that took place at our May 13 briefing are as described in the June 4 summary. We did not disclose any information on unannounced titles exclusively at the briefing. Moreover, we tightly control trade secrets and do not believe that any internal information was leaked.

Why do you disclose your medium-term earnings targets in ranges (i.e., net sales of ¥300-400 billion and operating income of ¥40-50 billion) when your guidance is usually released as specific figures? Does this mean you think you could see a variance of 10% in your net sales and 30% in your operating income?

Our medium-term targets are not part of regular guidance disclosures but rather a statement of our intent to create a business structure that enables us to consistently achieve net sales between ¥300-400 billion and operating income between ¥40-50 billion. We will separately release regular FY2021/3 guidance in accordance with disclosure regulations and our own disclosure policies.

Your business report states that you undertook “an in-depth review of the business strategy” at Luminous Productions Co., Ltd. What does that specifically mean?

The business lines that Luminous Productions Co., Ltd. was involved in had begun to expand, so we decided that it should focus on the development of major games based on new IP, which is the objective we had had when we initially founded the studio. We brought the firm’s structure in line with that objective, and they are now hard at work on developing major games.

Why are you looking for such a sharp drop in download sales in the ex-Japan Asia region in FY2020/3 versus FY2019/3?

As of FY2020/3, we have started handling our own sales in the ex-Japan Asia region, and download sales are difficult to forecast. As such, that figure represents our conservative estimate.