Let me paint you a picture from my childhood bedroom circa 1997. Disc one of Final Fantasy VII permanently lodged in my PlayStation. A well worn strategy guide dog eared at the Chocobo breeding section. Pizzas ordered and subsequently fossilized during marathon sessions. That Squaresoft logo appearing during boot up felt like a promise, every single time, that we were about to experience magic.

Fast forward 27 years and a different kind of nostalgia hits when I see that same company’s name in headlines. Except now it’s usually followed by phrases like “disappointing earnings” or “questionable management decisions” or “yet another live service shutdown.” The latest drama involves one of Square Enix’s largest shareholders releasing a 100 page PowerPoint presentation that’s essentially a corporate intervention letter. Singapore based investment firm 3D Investment Partners, holding nearly 15% of the company, basically told management “we’re not angry, just deeply concerned” through the medium of bullet points and pie charts. This is finance speak for screaming into a pillow made of spreadsheets.

The shareholder’s core argument resonates with anyone who’s watched Square Enix stumble through the last decade. Development costs balloon while sales underperform. Visionary single player experiences sit alongside half baked mobile cash grabs. Beloved franchises get neglected while new IPs crash and burn faster than a Phoenix Down in a boss battle. There’s a special kind of corporate witchcraft required to simultaneously frustrate Wall Street suits and gaming forum dwellers, yet here we are. (Base salary plus stock options if you can name five memorable Square Enix original IPs from the last five years, non Final Fantasy division.)

Digging deeper than the shareholder theatrics reveals three uncomfortable truths about modern Square Enix. First, their identity crisis rivals any teenage protagonist in their own JRPGs. Are they the prestige studio crafting lavish single player spectacles? The mobile game factory chasing microtransaction fortunes? The custodian of legacy franchises while experimenting with blockchain curiosities? Any company trying to be PlayStation, King, and CryptoKitties simultaneously deserves the migraines they’re getting.

Second, their budgeting approach resembles someone ordering appetizers at a fancy restaurant without checking menu prices. Developing a game with the scope of Final Fantasy VII Rebirth for one console generation before hastily porting it elsewhere is like commissioning a fresco on your living room ceiling before realizing you need to sell the house. Fans will debate whether Rebirth underperformed commercially because of PS5 exclusivity, franchise fatigue, or marketing misfires, but here’s the math that matters. When a tentpole release needs to sell 10 million copies just to break even, you’ve entered dangerous territory. At least your accountants get frequent flier miles from all those spreadsheet trips.

Third, there’s the uncomfortable reality that Square Enix operates in an industry where their Japanese peers adapted better to modern realities. While Capcom celebrates record profits from Resident Evil remakes and Monster Hunter expansions, Square Enix cancels projects after years of development. Bandai Namco leverages anime tie ins with surgical precision, while Square Enix fumbles multimedia universes. Sega turned Yakuza into a global phenomenon through consistency and clever localization, while Square Enix treats SaGa and Mana series like eccentric relatives they only acknowledge at holiday parties.

What fascinates me most isn’t the shareholder rebellion though, it’s the cultural ripple effects. For gamers raised on Chrono Trigger and Secret of Mana, today’s Square Enix feels like visiting your coolest childhood friend who now sells essential oils on Facebook. You recognize the face but the spark’s missing. Browsing their digital storefront reveals a strange duality where HD-2D remakes of cult classics sit next to baffling blockchain experiments, priced like they contain actual materia. Octopath Traveler’s lovely sprite work can’t distract from the fact their recent financial disclosures include phrases like “content abandonment losses” and “extraordinary write offs.” Industry analysts call this underperformance. Disappointed fans call it the price of abandoning what made them special.

The human impact extends beyond nostalgic gamers too. Consider the developers allegedly crunching to finish Final Fantasy VII Rebirth’s 200 hour odyssey while management green lights five mobile games destined for discontinuation before Valentine’s Day. Or the merchandising teams trying to sell action figures from games even hardcore fans struggle to remember. Even shareholders face existential head scratching as canceled projects evaporate investment value faster than a summon spell. Everyone loses when a company forgets who it serves and why.

Where does Square Enix go from here? The safe money says they’ll chase Western markets harder than Sephiroth chasing Cloud across continents. PlayStation exclusivity windows will shorten (hello Xbox ports), PC releases will accelerate (every Steam sale needs a $70 JRPG anchor), and mobile efforts will… well, pray for their mobile division. Maybe some executive will rediscover Midgar blueprints labeled “merchandise synergy” and drown us in plush Cait Sith dolls. But survival requires more than spreading existing bets wider.

The shareholder report suggests structural changes might help, though corporate restructuring sounds about as fun as grinding XP in a swamp zone. Splitting into distinct studios for AAA, mobile, and legacy content could prevent identity bleed. Empowering producers who understand Western markets without losing Japanese RPG sensibilities seems obvious (Tetsuya Nomura in charge of global strategy sounds terrifying and chaotic, exactly what they need). Mostly they should ask why Capcom can sell 10 million copies of a single character remake (Resident Evil 4) while Final Fantasy VII Remake trilogy struggles to match pace with exponentially higher budgets.

Ultimately, Square Enix’s predicament reflects gaming’s broader identity crisis. When audiences divide between $70 cinematic experiences and free TikTok adjacent distractions, mid tier publishers face the Kobayashi Maru scenario (an unwinnable test for non Star Trek fans). But here’s my unsolicited advice after consuming all 100 pages of that shareholder report between espresso shots.

Remember why people tattoo chocobos on their bodies. Stop chasing competitors through microtransaction deserts and blockchain jungles. Let the next Final Fantasy feel daring like VI’s opera scene rather than committee designed like XVI’s uneven pacing. Revive Parasite Eve with modern survival horror sensibilities. Give us Chrono Cross remakes and new Vagrant Story narratives. Basically, be weird again like when you made a game about gardening knights with tactical RPG elements and called it Final Fantasy Tactics Advance. Gamers will forgive staggered release dates and modest budgets. They won’t forgive losing the magic that convinced middle schoolers to spend summer vacation farming dragon scales just to forge a slightly better sword.

As I save this draft, my aging PlayStation 3 hums nearby with a scratched FFVII disc still inside. It’s a comforting relic from simpler times when “underperforming sales” meant less sequels, not existential shareholder threats. Now if you’ll excuse me, I need to check if 3D Investment Partners accepts feedback in the form of handwritten letters decorated with Cactuar doodles. Someone’s got to speak truth to power between all these materia slots.