Square Enix: 'Huge slump' in NA sales hurt Tomb Raider, Hitman, Sleeping Dogs

Publisher explains why, despite an increased effort on polish and quality, big-budget games fell short of expectation.

A "huge slump" in North American sales is to blame for big-budget Square Enix games Tomb Raider, Hitman: Absolution, and Sleeping Dogs coming up short, the publisher has explained.

In company documents posted this week, Square Enix said that though the games received generally favorable marks from critics, sales--at the level the company hoped for--did not follow.

"However, we were very disappointed to see that the high scores did not translate to actual sales performance," Square Enix said.

As previously announced, Tomb Raider (3.4 million), Hitman: Absolution (3.6 million), and Sleeping Dogs (1.75 million) failed to meet Square Enix sales expectations.

Square Enix this week put the shortcomings in context. Based on content, genre, and scores, the company said Tomb Raider was expected to move 5-6 million units, while Sleeping Dogs and Hitman: Absolution should have sold 2-2.5 million and 4-5.5 million units each, respectively.

"The European market was generally soft," Square Enix explained. "However, what affected us most was the huge slump in North American sales. Not only were sales sluggish, but we were also hit by additional costs in dealing with distribution channels, such as price protection and rebates, which placed huge pressure on our profit and loss."

Square Enix expects to see an "extraordinary loss" for the year ended March 31. The company is looking to new president Yosuke Matsuda--who replaces longtime executive Yoichi Wada--to turn the company around in the time ahead. He has promised a comprehensive review of the company.

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Discussion

414 comments
UltraredM
UltraredM

The horrendous management by Square Enix makes me worried that Crystal Dynamics will either be liquified or stuck with developing cheap iOS games. Either way, it would mean death for their incredible and promising Tomb Raider reboot franchise.

DEATH775
DEATH775

Wow $102,809,261 million  lost. Seriously its either fake or true IDK. What I can say is that if this is true then the cost of making the game was just too high and they went overboard on the budget. They shouldn't be too confident on aiming for sales up to 5 million. I mean the just look at what they are selling. Tomb Raider where previous game were mediocre, Hitman which last was release in 2006 and Sleeping dogs a new IP. In conclusion their strategy and forecast was awful.

Carpe_Noctum
Carpe_Noctum

Unrealistic expectations.  The sales numbers are very good considering  that the past few Tomb Raider games were not very good and the last Hitman game was in 2006. Sleeping Dogs is a new IP, how is 2 million units NOT good? I have Tomb Raider and Hitman and both games are very good, Tomb Raider being great. Can't wait to play the next next-gen Tomb Raider, just hope it's as killer as this one is.

gbernalesp
gbernalesp

I think that saying that Tomb Raider is a failure implies that Square Enix have done very little analysis in this issue., because:

1) They haven't considered online downloads, which nowadays is an essencial sales channel, 
2) It has only been a month since the game release
3) All the costs associated to game development, characters, technology, movements, etc, can be considered as an investment for the continuity for the franchise, therefore the future Tomb Raider games would have a considerably lower cost of production making them very easy to be profitable. They could release one title per year like Assassin's Creed, making the subsecuent games very profitable.

Considering all this I think the only explanation for Square Enix declaration is that they needed an excuse to change the CEO, and they blame it on an excellent game who already has sold millions of copies. I hope this doesn't stop the production of future Tomb Raider games.

ravenkiller
ravenkiller

because in America if it's not a multiplayer shooter then it's an immediate failure no matter how good it is.

Fragzoon
Fragzoon

The big bad bosses is currently enjoying their profit in the bahamas and still they are telling their marketing VPs to scare fans (because admit it some of us if not most think and behave like normal masses of people who sometimes just put things we like too high up there - and they know it and use it as leverage)

For the game developers... there's really nothing wrong (too much) with these kind of tactics... afterall other businesses has done so in the past and are getting away with it... just my advice: please RESPECT the gaming community, and use honest, care-giving, postive attitude strategies. The majority of the gaming consumers are not the same as the herds in other types of entertainment industry.

For the community, please take the hype with a grain of salt and think realistically.... Sure I support the game developers and thank them for the effort and results, and if you can.. you should too, but don't go out of your way. They should earn your respect and purchases... Really, if they're not successful the news heard wouldn't be about this... it would've been about SquareEnix closing its doors!

I'll eat my words if they really not gonna be making the sequel for tomb raider.... that is just.... not profitable... lol

natasha8384
natasha8384

Overblown sales expectations are a part of the problem. I played Hitman and Tomb Raider, both very good but always missing something to make them the "must have" purchase. A lack of co-op modality is one of the problems and a multiplayer is just an afterthought in TR. The developer's insistence on  deploying archaic QTE throughout TR is also deplorable and which repels potential customers who hate randomly mashing keyboards or gamepads. In the end, both titles, as they are,  made lots of money for SE so the internal overspending must be a part of the financial problem the company is facing.

Ranma_X_basic
Ranma_X_basic

Funny how Square is the only developer having problems because they can't even tell the gaming community what the hell is going on with Versus 13 (i'm just gonna assume it's D.O.A) and also if and when they will announce Kingdom Hearts 3.

Seriously Square Hitman Absolution and Tomb Raider have probably sold pretty damn well (well at least to my knowledge they have). it's your fault because it's been years since you showed the Vs. 13 trailer at E3 and then you went all silent after that not showing any new trailers, screen shots or even sharing info on said title. Face it square you're acting kinda like Capcom and probably don't care about the very people that have supported and played your games for decades. 

In my opinion probably games released on handhelds (psp,vita and nintendo handhelds) have sold well while your console RPGs are lacking. but again this is just my opinion.

BFarmer1980
BFarmer1980

You know, there's a certain title that SE's been neglecting in favor of handheld spinoffs for the past 8 years now that would provide them a surefire North American & Global seller if they'd just get to work on it...

Unfallen_Satan
Unfallen_Satan

SE needs to cut back a bit or at least spread out more. Regardless of the number of hopefuls or even worthy contenders, there can only be so many blockbusters a year. It's true of movies, and it's true of games. On top of that, SE's recent big releases, especially Tomb Raider, are more like Oscar nominees than blockbusters. I may think it enriching to play them at some point, but I was not gonna go out and pre-order because all my friends planned to play from Day 1. On top of everything, it doesn't help that Tomb and Hitman are both sequels in franchises that, before the revival, were dragging their heels and that Sleeping Dogs is very much a marginal market.

Face it, the blame is not in the NA market; the blame is with whoever came up with all those sales expectations.

Atombomb1981
Atombomb1981

The projected sell figures were unrealistic. Tomb Raider franchise was just revitalized and after the previous titles a lot of people were reluctant to buy it, despite the aggressive promotional campaign. Hitman Absolution, while a good game, missed the mark completely, by forgetting what Hitman titles are about. Sleeping Dogs, well when people have GTA games are not usually interested in shallow clones. All these combined with the use of Steam + the DLC business plan kept those figures below.I personally think that the use of Steam (especially for Tomb Raider and Hitman Absolution) is simply one of the dumbest ideas ever. Not to mention Capcom and their new Resident Evil/DMC titles.

hawaiiinsomniac
hawaiiinsomniac

When there are no great games - we complain.

When they're are great games - not enough people are buying them.

Please don't say Temple Run is the future #FML

David_M_Spiker
David_M_Spiker

I find it hard to care when they didn't push a Wii U ver of tomb raider. 


puppet12ca
puppet12ca

its a shame I havent played tomb raider yet but sleeping dogs was well made and considering it was a not part of any existing series I think it sold well under the circumstances Hitman had its flaws but their were definitely some aspects to it I liked and I am hopeful it will be more balanced in the next installment but seriously moving several million units its really hard for me to see this as a failure in game sales

Rennik_Repotsir
Rennik_Repotsir

There was a good chance that I would've bought Tomb Raider day-1 if I had a demo to try; now it's going to be a bargain-bin purchase...

telaros
telaros

Did someone accidentally re-post old news with slightly reworded text? Cause that's all I'm seeing here.

Square seems to have gone into 'detail' which sums up to blaming American sales for 'allowing people to get money back' of any kind for their games, be it a price drop and someone who bought the game with their credit card goes all "I paid 59.99 but Amazon has it for 59.96! I demand a refund!" and deals for ordering in advance or whatever promotion?

F you square. Those games did amazingly well. You just happen to be dealing with a place that takes less bullshit and requires more results before we toss out our hard earned (or not so hard earned) money.

"Boo hoo, Americans can abuse price protection to get sale on our game if it is on promotional sale anywhere by showing proof of place that has a sale for that product. That is so unfair"

Suck it. Spend more time fleshing out your games and just give everyone their badly translated, over 10 years old, jrpg they been wanting off you called FF7. Sad but true, you'll see sales jump to 10mil if you do that :p

wexorian
wexorian

Squarenix Sales manager Must Back to University he need new diplom i say that.

vivalatour
vivalatour

same ole' story with all Big Companies , I NEVER MADE ENOUGH MONEY IN MY LIFE EITHER ! I went years w/o pay raises and even had "PAY CUTS" and "VACATION" days "TAKEN"  from me ! Does anyone care about my story ?  > NO !

DannyC_pt
DannyC_pt

3.4 millions sales for Tomb Raider in one month and Square Enix says it's coming up short?! Crystal Dynamics brought the franchise back from the dead and have made a great game that's selling well. If Square Enix can't make a profit from TR that's bad management, don't put the blame on the game.

SgtDarthVader
SgtDarthVader

First of all, I never got the feeling that multiplayer hurt TR's singleplayer, that said, the multiplayer wasn't very impressive... I think that TR expectations were ridiculous, in less than one month it sold 3,4 million copies AND became the best selling TR in history... and that still fell below there expectations, WTF?

I cannot comment on Sleeping Dogs, I never played it.

Hitman, well I think it was a good game, but it had its flaws, it felt more like a stealth game (like Splinter Cell) and less like an assassin game, that needs to be changed.

DarthLod
DarthLod

You ruined TR by adding Multiplayer and stupid QTE crap Learn a lesson.

91210user
91210user

No one cares SquareEnix but thanks for making the Tomb Raider reboot, picking up Sleeping Dogs after Activision abandoned it and for allowing the European development team to make and finish their Hitman game, they were great projects that needed finishing. Serves you right for stalling Final Fantasy Versus XIII, you trolls on some Japanese island.

Evil_Rage
Evil_Rage

I've got a few ideas. Scrap a Sleeping Dogs sequel if it means Hitman and Tomb Raider get more polish, especially on PC. I've said this before, but I'll say it again. Remove the multiplayer aspect from these single player oriented games. Nothing. No co-op, no multiplayer deathmatch. Nothing. Don't waste time or financial resources on it. Utilize resources to make Tomb Raider an engrossing open world full of exploration, wild animals, enemy npcs to contend with, things to discover in tombs, multiple endings and to make it better, make single player dlcs to expand upon the story with more endings, as well as side stories with possible endings of their own, full of new content, like new weapons and equipment, new outfits, with new enemies to face, more tombs and places to explore. 

As for making a new Hitman, remove the multiplayer and allocate resources into the single player. As I am disgusted with the story of absolution, I feel like Agent 47 should be the main focus for the next game and the girl? I found her to be a forgettable waste of time. I want the next game to be Agent 47's story, with no mention of absolution whatsoever. As for single player dlc,  new weapons, new suits/costumes that can be used any time in the story, and  new sets of missions to complete should be enough.

Then, put the games on blu-ray for PC (as an alternative to steam please) with the minimal drm of a simple key input, before installation (unlimited installs) and have the retail be 40 US dollars. I know I'd buy that on release day and will definitely buy the blu-ray complete edition with all the DLC on disc when that comes out. Just to add a side note about DLC, preorder DLC is fine, but the PC and consoles should all be treated equally and get all game DLC, no exclusive console only nonsense, and please no Day 1 DLC either.

tightwad34
tightwad34

Maybe make less games and focus on making the ones you do make all that much better. I have heard nothing but good things about Tomb Raider, and mostly good about Hitman and Sleeping Dogs. So either make less and polish more, or just cut the number down so you won't lose a shit ton more money.

starduke
starduke

OK, they make a game that feels more like generic shooter then a Hitman game, a game that's infested with QTEs and feels more like Uncharted then Tomb Raider, and a game that's very good, but has bad DLC, and then they wonder why they had poor sales?

asifah30
asifah30

Are we watching another 'THQ'???

Davhut
Davhut

There is one point I am not seeing here and that is under the current global financial strain which when translated into the everyday man's financial liquidity, means that the slump in the USA and in Europe especially, we the ordinary folk do not have as much disposable cash to spend on gaming.  Therefore Square Enix who must have financial directors on their board are either inept at understanding the dynamics of world economics or are woefully blind to the pragmatic considerations required to set target returns on their games.  Lower your expectations Square as we are all having to do.

Mkeegs79
Mkeegs79

Square Enix losses money by having what seems like a lazy clueless development team behind their JRPGs. How long can they take to make Final Fantasy Versus XIII? I am sick of this and them announcing games they have just the planning stages. If it wasn't for their western studios, they wouldn't have anything right now.

Expectations on Tomb Raider was ridiculous. It sold better than previous games in the franchise. What idiot came up with the projections? Also, make some damn new IPs already!

printice21
printice21

They still haven't counted the digital distributions! these are the same numbers from the original article! so every PC copy sold dosent count, all the copies sold online through the playstation store dont count... Square enix needs to reevaluate their expectations! best selling game in the franchise... they are not impressed.

juno21
juno21

Sleeping Dogs was a awesome game! Their DLC approach was horrible though, didnt touch a single one. With that said I had a lot of fun playing the game and hope that more people check it out. 

docwoo
docwoo

That's too bad.  I'm playing the Tomb Raider reboot right now and it's a pretty sweet game. 

Bordonaro
Bordonaro

Well maybe if they made Tomb raider like an actual Tomb Raider instead of a 3rd person shooter action rpg...Uncharted did a better Tomb Raider than the newTomb Raider

murph85
murph85

@Carpe_Noctum Yeah I think Square Enix is living in a fantasy land. Tomb Raider sold almost 3.5 million in its first month but apparently that isn't good enough for SE?

S7evin44
S7evin44

@ravenkiller You're joking right? Multiplayer shooters are more popular in China, Japan and Europe. They are popular in the US but not anymore than other countries. You should look up the statistics first. I'm American and I don't own any CoD games, nor do any of my friends. Sleeping Dogs should have gotten a heal of a lot more money, it truly is an amazing game. The main reason games like CoD and WoW get high sales here is because gaming isn't given any spotlight. There are no TV shows about games, X-Play was the only one and its gone now. They don't even advertise games in commercials that much, only ones I have seen are WoW, CoD, Sony Games and Madden. We all want CoD to die as much as everyone else, so stop bashing people's countries if you don't know anything.

murph85
murph85

@Ranma_X_basic Perhaps another comparison would be that Squre Enix is trying to be like Ubisoft. I mean I believe Ubisoft will be putting out 4 different titles this year(AC IV, Watch Dogs, Rainbow Six, Splinter Cell). Difference is Ubisoft developes their titles while Square is only the publisher.

roman4545
roman4545

@hawaiiinsomniac  

maybe because all great games are coming at the same time and makes it hard to choose which game to pick first especially when all games are priced $60

SupaSaba
SupaSaba

@Rennik_Repotsir Honestly if they gave you a demo, I can't see how it would be representative of the entire game. They could've given you a combat section but then you'd be missing out on the puzzle solving or exploration gameplay and vice versa. I think it was the right decision. In saying that this game is amazing go buy it! Guarantee you won't be disappointed :)

epross
epross

@Rennik_Repotsir Well it's a bonus if you can get a cheaper price. I bought it day 1 just on marketing hype alone and am satisfied with the game - way better than most previous Lara Croft games (much better than Underworld and I enjoyed that game too - mostly) I hope they turn it around as I think they have some talent.

Strategizer
Strategizer

@telaros You bring up exactly how SE is acting right now sir. I love FF7 TBH though it is a classic to me and I would be better off working on the games they are. Tomb raider was great and from what I can see the new hitman is too but I have not played it and sleeping dogs I have coming through gamefly. Still looking at the sales I'd say 1.75 million copies for a new IP in sleeping dogs is pretty damn good and 3.4 million for tomb raider and 3.6 million is great as well. Still SE has been caught behind because of managment. 

They believe these 3 games should rise them above. Why? cause they got good ratings? Seriously square let's take tomb raider alone and in a month the game has sold 3.4 million. I would say that that's a good start to getting a company on track make a sequel that's better and you will get more money. 

Three games will not bring a company out of debt. Still you guys are on the right track so stop whining and bring the games you have been promising us.



slainta
slainta

@DannyC_pt Well, it depends. TR is sold at half the price in Amazon UK. It already had a few days sale in the PS Store. And then it is 3.4 ml in 3 platforms. SE invested a lot in that game, it is actually surprising  On the other hand it has quite a large number of seeders in the pirate bay. Even for X360. Not as many as for PC, but still few hundreds.

Greyfeld
Greyfeld

@Mkeegs79 VS13 has already been verified as canceled, its resources absorbed into the upcoming FFXV.

NeonNinja
NeonNinja

@Mkeegs79 I'd post a comment regarding these morons but you said everything that needs to be said.

rmartinezdl
rmartinezdl

@murph85 @Carpe_Noctum The problem is everyone comparing themselves to CoD sales, they all want to do that, you cant compare a Good Quality Item to a piece of shit like call of duty titles, its like saying "Mercedes benz dissapointed since it doesnt sell as much as hot wheels cars" Call of Duty is a game for kids, Hitman, Tomb, and Sleeping are both true gamers games, I have them, they are great, no way a 8 yo kid could play hitman, he would rage just by watching the  "hard" main menu LOL!

SupaSaba
SupaSaba

@slainta @DannyC_pt Still the sales are amazing for the franchise. Especially considering the previous game hasn't even sold 3.4 million yet and it was released in 2008 ... Crystal Dynamics also said it's the fastest selling Tomb Raider of all time. So ... something's not right in Square Enix's offices haha

LilithN
LilithN

@PurpleWarden @Evil_Rage  while I really really liked Sleeping Dogs, much more then GTA as I loved the setting and the main char too, I do agree with Evil_Rage about all this multiplayer bullshit. We dont need mp for every damn game, I'm not interested in that, if I want multi I would play COD or something similar. There is no place for mp or coop in a typical SP like Tomb Raider.Waste of resources!