Square Enix Holdings Co (9684) AI Stock Analysis

• Market Cap: ¥1.17T
• Dividend Yield: 1.61%
• Average Volume (3M): 1.06M
• Price to Earnings (P/E): 62.0
• Beta (1Y): 0.44
• Revenue Growth: -7.85%
• EPS Growth: -3.39%
• Country: JP
• Employees: 4,770
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 13.33
• Shares Outstanding: 367,594,800
• 10 Day Avg. Volume: 1,224,370
• 30 Day Avg. Volume: 1,063,213
• PEG Ratio: 0.54
• Price to Book (P/B): 2.48
• Price to Sales (P/S): 2.57
• P/FCF Ratio: 26.16
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ¥2,706.13
• Price Target Upside: -15.88% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 5

• Rating: 57 Neutral
• Price Target: ¥3,312.00 ▲(2.95% Upside)

Square Enix Holdings Co's overall stock score is primarily influenced by its stable financial performance, characterized by strong profitability and low leverage. However, the technical analysis indicates a bearish trend, and the high P/E ratio suggests potential overvaluation. The lack of earnings call data and notable corporate events limits further insights.

Positive Factors

Strong Profit Margins

High profit margins indicate efficient cost management and operational efficiency, which can sustain profitability even if revenue growth slows.

Robust Balance Sheet

A strong balance sheet with low leverage enhances financial stability and provides flexibility for future investments or downturns.

Cash Generation Ability

Effective cash generation supports ongoing operations and strategic investments, ensuring long-term business sustainability.

Negative Factors

Decline in Revenue Growth

A decline in revenue growth can signal challenges in market expansion or product adoption, potentially impacting future earnings.

Decreased Operating Cash Flow

Reduced operating cash flow can limit the company's ability to fund operations and investments, affecting long-term growth potential.

Revenue Growth Concerns

Sustained revenue growth is crucial for maintaining market position and competitiveness; recent declines may indicate underlying issues.

Square Enix Holdings Co Business Overview & Revenue Model

Company Description

Square Enix Holdings Co., Ltd. operates in the content and service businesses in Japan, North America, Europe, and rest of Asia. It operates through four segments: Digital Entertainment, Amusement, Publication, and Merchandising. The company's Digital Entertainment segment plans, develops, distributes, and operates digital entertainment content primarily in the form of games. This segment offers digital entertainment content for various customer usage environments, including personal computers and smart devices, as well as consumer game consoles, such as handheld game machines. Its Amusement segment is involved in the operation of amusement facilities. This segment also engages in the planning, development, distribution, and rental of arcade game machines and related products for amusement facilities. The company's Publication segment publishes and licenses comic magazines, comic books, and game-related books. Its Merchandising segment plans, produces, distributes, and licenses derivative products. The company publishes, distributes, and licenses entertainment content under the SQUARE ENIX and TAITO brands. Square Enix Holdings Co., Ltd. was founded in 1975 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Square Enix generates revenue through multiple streams, primarily from the sale of video games across various platforms including consoles, PC, and mobile devices. The Digital Entertainment segment is the largest contributor to its revenue, driven by both new game releases and ongoing revenue from live services and downloadable content (DLC). In addition to direct game sales, the company earns significant income from microtransactions within its mobile games. Merchandise sales related to its popular franchises further enhance its revenue. Partnerships with other companies for co-development or distribution of games also play a crucial role in its financial success. Furthermore, licensing its intellectual properties for adaptations in films, television, and other media provides an additional revenue stream, reinforcing its presence in the broader entertainment landscape.

Square Enix Holdings Co Financial Statement Overview

Summary

Square Enix Holdings Co demonstrates a stable financial position with strong profitability and low leverage. Despite a recent decline in revenue, the company maintains healthy margins and a solid balance sheet. Cash flow generation is adequate, though there is room for improvement in cash flow growth.

Income Statement

Square Enix Holdings Co has shown a mixed performance in its income statement. The company experienced a decline in revenue growth rate by 6.55% in the most recent year, indicating a potential slowdown in sales. However, the gross profit margin remains strong at 48.89%, and the net profit margin improved to 7.52%, reflecting efficient cost management. The EBIT and EBITDA margins are also healthy at 12.26% and 14.87%, respectively, suggesting solid operational efficiency.

Balance Sheet

The balance sheet of Square Enix Holdings Co is robust, with a very low debt-to-equity ratio of 0.0046, indicating minimal leverage and financial risk. The return on equity is moderate at 7.26%, showing decent profitability relative to shareholder equity. The equity ratio is strong, suggesting a solid capital structure with a high proportion of equity financing.

Cash Flow

The cash flow statement reveals a strong free cash flow to net income ratio of 74.59%, indicating effective cash generation relative to net income. However, the operating cash flow has decreased, and the free cash flow growth rate is not applicable due to the previous year's negative free cash flow. The operating cash flow to net income ratio is moderate at 63.51%, showing reasonable cash conversion efficiency.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	313.87B	324.51B	356.34B	343.27B	365.27B	331.05B
Gross Profit	155.46B	158.65B	167.37B	175.89B	195.31B	159.21B
EBITDA	42.03B	48.25B	25.68B	51.25B	66.86B	54.74B
Net Income	18.60B	24.41B	14.91B	49.26B	51.01B	26.94B
Balance Sheet
Total Assets	402.48B	416.16B	411.93B	400.59B	380.90B	336.14B
Cash, Cash Equivalents and Short-Term Investments	231.72B	247.76B	225.90B	193.50B	163.09B	146.23B
Total Debt	3.78B	1.54B	2.15B	2.17B	4.34B	3.78B
Total Liabilities	73.24B	79.79B	94.80B	83.32B	96.47B	92.86B
Stockholders Equity	328.94B	336.06B	316.87B	317.04B	284.24B	243.13B
Cash Flow
Free Cash Flow	0.00	31.91B	42.95B	6.55B	22.08B	30.05B
Operating Cash Flow	0.00	42.78B	52.24B	12.23B	27.57B	35.00B
Investing Cash Flow	0.00	-15.11B	-13.21B	27.60B	-8.12B	-6.65B
Financing Cash Flow	0.00	-6.60B	-14.79B	-15.52B	-9.34B	-6.65B

Square Enix Holdings Co Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3217.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9684, the sentiment is Negative. The current price of 3217 is below the 20-day moving average (MA) of 3267.46, below the 50-day MA of 3415.60, and above the 200-day MA of 2790.01, indicating a neutral trend. The MACD of -43.06 indicates Negative momentum. The RSI at 40.68 is Neutral, neither overbought nor oversold. The STOCH value of 60.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:9684.

Square Enix Holdings Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3659	77 Outperform	$2.67T	26.73	10.04%	0.90%	2.84%	51.14%
6460	72 Outperform	$589.43B	38.07	4.51%	1.68%	-12.78%	-56.73%
3635	72 Outperform	¥694.59B	21.82	―	2.35%	-4.23%	-18.49%
9766	68 Neutral	¥3.04T	40.38	16.24%	0.80%	13.45%	16.03%
9697	66 Neutral	¥1.82T	32.69	26.13%	0.98%	34.28%	58.34%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
9684	57 Neutral	¥1.17T	61.98	5.77%	1.61%	-7.85%	-3.39%

Square Enix Holdings Co Corporate Events

Square Enix Reports No Share Repurchases in March 2025

Square Enix Holdings Co., Ltd. announced that no shares were repurchased during the period from March 1, 2025, to March 31, 2025, despite a prior board resolution allowing for the repurchase of up to 5 million shares. This lack of share repurchase activity may indicate a strategic decision to maintain current capital levels or reflect market conditions, potentially impacting investor perceptions and the company’s stock performance.