Square Enix won't spend cash from $300 million studio sale on blockchain projects

Square Enix has explained that cash from the sale of key studios and franchises won't be used to fund blockchain initiatives.

The Japanese company recently sold three key studios including Crystal Dynamics and Eidos-Montreal to Embracer for $300 million and suggested the proceeds would be used, in part, to move forward with investments in fields "including blockchain, AI, and the cloud."

Now, however, the company has dialled back those sentiments and instead says it will use the funds to bolster its development capabilities, echoing remarks it made last month.

"Rather than using the proceeds from the divestiture in new investment domains such as NFT and blockchain, we intend to use them primarily to fund our efforts to foster solid IP and to enhance our development capabilities in our core Digital Entertainment segment," explained the company in a financial briefing.

Further outlining the rationale behind the Embracer deal, Square Enix said the primary purpose of the transaction was to reorient its portfolio with a view to "stepping up our offering of online titles that we develop for the North American and the European market."

"We want to focus on creating new titles that align with our strategy, including ones that leverage new IP," added the company. "In addition to reorienting our portfolio, we will also enhance our publishing function."