In a statement, the publisher predicted a net loss for the year ending March 31st. The company had previously expected to profit. Square Enix blamed the loss on the costs incurred in cancelling projects.
"Under a rapidly changing operating environment and more prudent estimates of future cash flows, the Company plans to write down goodwill (approximately 8.8 billion yen)," the publisher said.
"Further, as a result of introducing a tightened selection standard regarding title lineup to strengthen the revenue base of the Company's digital entertainment segment, project development cancellation and related losses (approximately 4.5 billion yen) are expected."
The Japanese earthquake has also taken its toll according to the publisher, incurring losses of around 0.6 million yen.