By: Brendan Sinclair

Square Enix expects to turn a tidy profit for its current year, but it’s off to a bad start. The publisher today reported results for its first fiscal quarter (the three months ended June 30), which saw net losses of nearly ¥2.1 billion ($26.4 million). For the same period the year before, Square Enix turned a profit of ¥690 million ($8.8 million).

Despite the hit to the bottom line, Square Enix sales were up for the quarter. Citing the Japanese release of Dragon Quest Monsters: Terry’s Wonderland 3D for the 3DS as a strong performer, the publisher posted sales of ¥24.9 billion ($316.5 million), up about 1.6 percent year-over-year. Square Enix also highlighted successes in the browser-based and mobile markets with the Japanse free-to-play title Sengoku Ixa and the social-focused Final Fantasy Brigade.

"The advancement of networking and digitalization, and the diffusion of smartphones have triggered a fundamental change in the business environment surrounding the Group, where content delivery measures to customers and business models are increasingly diversified," the company said in its report. "The Group views this change as an opportunity to capture new profit sources, and is making every effort to establish its profit base through expansion of content and services that conform to emerging customer needs, and launch of full-scale commercial services for major MMO titles."

Square Enix left its full-year financial forecast unchanged, with the publisher expecting to turn a profit of ¥9 billion ($114.3 million) off sales of ¥165 billion ($2.1 billion). Its remaining slate of games for the current fiscal year includes a number of high-profile new releases, including Tomb Raider, Hitman: Absolution, and next week’s Sleeping Dogs.

Source: GameSpot