Square Enix Holdings Co., Ltd. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Shareholders might have noticed that Square Enix Holdings Co., Ltd. (TSE:9684) filed its half-year result this time last week. The early response was not positive, with shares down 7.4% to JP¥5,542 in the past week. Statutory earnings per share disappointed, coming in -87% short of expectations, at JP¥9.39. Fortunately revenue performance was a lot stronger at JP¥158b arriving 16% ahead of predictions. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Square Enix Holdings

Taking into account the latest results, the current consensus, from the 13 analysts covering Square Enix Holdings, is for revenues of JP¥325.2b in 2025. This implies a discernible 4.9% reduction in Square Enix Holdings' revenue over the past 12 months. Per-share earnings are expected to soar 218% to JP¥266. In the lead-up to this report, the analysts had been modelling revenues of JP¥323.1b and earnings per share (EPS) of JP¥276 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at JP¥5,735, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Square Enix Holdings, with the most bullish analyst valuing it at JP¥7,000 and the most bearish at JP¥4,460 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that revenue is expected to reverse, with a forecast 9.5% annualised decline to the end of 2025. That is a notable change from historical growth of 4.4% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 9.6% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Square Enix Holdings is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Square Enix Holdings' revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Square Enix Holdings. Long-term earnings power is much more important than next year's profits. We have forecasts for Square Enix Holdings going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for Square Enix Holdings that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.