They don't HAVE "countless other titles" that fall by the wayside or fail. Pretty much every game they release is successful, some more than others, of course. XIV is their only failure in recent years. The reason they lost money last year was because of canceled developments since they took on a much more "tightened selection standard" for titles (their words, not mine) due to the state of both our economy currently and trends amongst gaming, they can't afford to take as many risks now. Their sales figures only dropped from 130,000 million net profit to 125,000 million because the shit they are releasing is still doing well.
Of course they're not Nintendo (who might I add, make profit off of hardware and very little off of software comparatively). But you grossly underestimate the FF franchise. No, it's not Mario, but it is still one of the biggest selling franchises of all time in gaming (hell, if you don't count the sales on EVERY Mario title released including spin offs, I'm fairly certain it's the single largest, but I'm not gonna dig up those numbers).
XIII brought in plenty of profit for them. It sold something ridiculous like 6-7 million copies, which is a hell of a lot. They've also reused (and will still be using) the crystal tools engine they built.
If Square were to stick with their "safe" series (Final Fantasy, Dragon Quest, Kingdom Hearts, etc) they would be making nothing but profit (natural disasters aside I suppose! The earthquake made them lose something ridiculous like half a billion yen). But they constantly pick up and fund other games from outside developers to try and make more money, which is apparently something they won't be doing so frequently anymore.
XI Wiki



