Luminous Productions, the company that developed Final Fantasy XV and Forspoken will now be merging with publisher Square Enix. The merger will happen on the 1st of May 2023.

This was announced on Square Enix’s Official Website which made the following statement explaining the reason for the merger:

“The merger is part of the Company’s efforts to further bolster the competitive prowess of the Group’s development studios, a goal set forth under its current medium-term business strategy. SQUARE ENIX CO., LTD. has developed numerous AAA high-definition (HD) games and possesses a wealth of intellectual property (IP) and content. Luminous Productions Co., Ltd. is meanwhile equipped not only with AAA title development capabilities but also technical expertise in areas such as game engine development. Combining the two entities will further enhance the Group’s ability to develop HD games.”

In some ways, it feels a little odd to say that Luminous Productions is merging with Square Enix when they were never quite separate entities in the first place. Luminous Productions was formed as a subsidiary of Square Enix, assembled from employees that worked on Final Fantasy XV. By merging with Square Enix, they’re essentially just going back to being an internal studio as opposed to an external studio.

While not confirmed, a likely reason for the merger is the reception to Forspoken. This was the studio’s first original IP which launched earlier this year to mixed reviews from critics and audiences. Some people enjoyed the open-world action mechanics while others disliked its story and awkward dialogue. While we don’t know the game’s total sales, its first-week sales in Japan were fairly low at less than 30k copies sold.