Analyst: Square Enix lost $200 million on Marvel games

Analyst: Square Enix lost $200 million on Marvel games

Yesterday it became known that Square Enix sold several of its Western studios and major franchises for a rather modest sum of $300 million.
For instance, The Game Market's David Gibson believes that it's about the last two Marvel projects - Marvel's Avengers and Marvel's Guardians of the Galaxy.
We know for a fact that Square Enix is not happy with the performance of both games - the company stated that in reports to investors.According to Gibson, the losses from the two Marvel games for Square Enix are estimated at about $ 200 million.
And, they say, that's why the publisher decided to get rid of a group of North American assets at once - the main growth accounts for the Japanese divisions, and it was too difficult for Square Enix to manage studios in the United States and Canada, especially against the background of dreary financial results.
Nevertheless, Gibson emphasizes: $300 million - an unusually low price for such a powerful set of studios and franchises.
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, 2022The Embracer Group is the new owner of the assets.
In their presentation about the deal, company representatives explained: Marvel's Avengers and Marvel's Guardians of the Galaxy are part of the purchase, but these games must get additional approval from some outside party - probably meaning Marvel.
Users are already speculating that the Avengers won't survive the move to a new company - they're already breathing heavily as it is.
Overall, Embracer has a positive outlook: it expects the investment will break even (or even slightly improve) in the next couple of years - mainly due to the so-called \"back catalog\" with the already released games, which will be obtained from Square Enix.
It's possible that profits will be higher if Embracer \"decides to enter into deeper strategic relationships with one or more platforms.\" Maybe Game Pass or PlayStation Plus deals are implied? Also, Crystal Dynamics and Eidos-Montréal have \"very interesting and big\" AAA games in production, both for established franchises and new ones.
But it seems like these games aren't supposed to make it to release until a few years from now.

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