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Square Enix feared Eidos, Crystal Dynamics games cannibalized other sales

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polygon.com

Square Enix executives, in their first quarterly earnings call since selling the Tomb Raider and Deus Ex franchises and the studios making them, explained that decision to investors on Friday.

The publisher’s reasoning, according to analyst David Gibson, is that its Western studios and their products might have been cannibalizing sales from the rest of the group, so selling them off “could improve capital efficiency” — basically, making more money relative to what the company spends to make more money.

Square Enix offloaded Eidos, Crystal Dynamics, and the IPs they owned to Embracer Group at the beginning of May. The two studios are the latest big-name acquisition for the Sweden-based publishing conglomerate, which already owns Gearbox Software, Saber Interactive, Plaion (formerly Koch Media), and Deep Silver, as well as comic book publisher Dark Horse and tabletop game maker Asmodee.

The sell-off followed a long stretch where Square Enix’s Western operations would publish a AAA game and headquarters would poor-mouth its sales performance in the next call with investors.

Read more on polygon.com
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