Everyone was caught off guard when Square Enix made the decision to sell its Western studios (Crystal Dynamics, Eidos Montréal, and Square Enix Montréal) to the Embracer Group for the comparatively low sum of $300 million.


Shortly after that information was made public, the Japanese company issued a press release describing the key justifications for the sale, including the need to move forward with investments in industries like blockchain, artificial intelligence, and the cloud while also creating new businesses.


But Square Enix representatives brought it up again during the conference call as part of the quarterly report that was made public today. According to analysts David Gibson and Serkan Toto, Square Enix anticipated that titles from Crystal Dynamics and Eidos Montréal would affect the company's overall revenue, which is why the agreement was made this time.




For a while now, Square Enix has been declining. Stephane D'Astous, the company's creator, reportedly declared in a statement that the studios were a "train crash in slow motion." Square Enix's Japanese shareholders are somewhat to blame, according to D'Astous, for the way the company handled its Western studios.


The expectation is that under Embracer, which normally permits its subsidiaries to function independently, Eidos Montréal, Crystal Dynamics, and Square Enix Montreal will each get off to a fresh start.