One outsourcing studio in Japan is feeling the impact of game cancellations and the overall instability of the industry.
Although Tose may not be a familiar name to many, if you stick around for the credits of various popular games from Japan, you’ll likely see their name listed. Tose has worked on co-developing, supporting, and porting numerous games from the NES and Game Boy era to modern consoles like the PS5 and Nintendo Switch, including titles such as The Legend of Zelda: Breath of the Wild, Dragon Quest Monsters: The Dark Prince, Crisis Core: Final Fantasy 7 Reunion, and Resident Evil Revelations.
Despite their long history in the industry, Tose is currently facing challenges. Their financial statement for the period between September 2023 to May 2024 shows a nearly 28% decrease in net sales compared to the previous year, resulting in an operating loss of 599 million yen ($3.7 million).
The studio attributes these losses to game cancellations happening across the industry. While Japanese publishers are not experiencing widespread layoffs like in other regions due to worker protection laws, companies are still feeling the effects of the post-pandemic landscape. For example, Square Enix, a frequent collaborator with Tose, recently announced the cancellation of several unannounced games and incurred around $140 million in “content abandonment losses.” Similarly, Bandai Namco, another publisher that worked with Tose, revealed that at least five games in development were scrapped due to profit losses last year.
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