The potentially lucrative holiday quarter -- Q3 of Square Enix's fiscal year -- didn't bring a slowdown to the publisher's sinking profits. Instead, the company slid closer to landing in the red as 2010 came to an end. For the nine months ending December 31, 2010, Square Enix today reported a net income of ¥1.821 billion ($22.33 million), a 76.6 percent decrease in profits from the same period the year before. When the iPhone port of Secret of Mana is perhaps your most significant release during the holidays, what more can you expect?

Accordingly, net sales in the nine-month period were also down year-over-year (though just by 27.5 percent) for the business, which (aside from games) includes amusement, publication and merchandising products. Speaking of games, the holiday quarter didn't push any additional Square Enix titles into coveted "million-seller" status -- only Kane & Lynch 2 and Dragon Quest Monsters: Joker 2 (Japan only) have reached a million in sales during the company's current fiscal year (ending March 31, 2011), and both had done so by the end of last September.

"Responding to intensifying competition in the console game market, the company has implemented organizational changes in the third quarter while also working to better select and further strengthen our most competitive titles," Square Enix president Yoichi Wada offered in a short statement accompanying the financial report.

"In other platform areas including PCs and smartphones, we have created successful examples of new content such as Nicotto Town and Sengoku Ixa," Wada added. "By pursuing these two independent markets, we are raising our ability to succeed in diverse business models." So diversified has Square Enix become, in fact, that this is the first we've ever heard of these two "successful" projects!

[Pictured: Nicotto Town; image source: nifty.co.jp]

This article was originally published on Joystiq.