In its most recent quarterly financial report, Square-Enix has managed to cut its quarterly losses by 75% compared to the same quarter last year.
Browser titles including DragonQuest X Online are helping to drive revenue for the publisher.
The ailing publisher still finished the quarter with a £3.26m loss and did not release anything major over the three month period ending June 30 2013. In the same period in 2012 however, the loss stood at £13.7m.
Browser games including Sengoku IXA and DragonQuest X Online helped to drive the £159.4m revenue and digital sales increased year-on-year by 2.1%, bringing in £76.7m.
This was further buoyed by the publisher's arcade system business and also manga publishing activities. The company's console business is however contributing very little at this point.
In a separate statement issued alongside the financial results, Square-Enix also booked an Extraordinary Loss of £10.5m in response to 'the latest environmental changes in the game industry'. The one off loss recorded by the company is as a result of a comprehensive review conducted on titles currently in development.
The nature of this loss does not however mean the publisher has to revise its financial outlook for the year. An end-of-year net profit of approximately £23m-£39m.
Square-Enix recently lost Eidos Montreal founder Stephane D'Astous who cited 'irreconcilable differences' with the publisher as his reason for stepping down.
The company's end-of-year financial results published in March showed that Square-Enix had fallen short of its forecast with a £90m loss, blamed on the slow sale of console games in the West as well as company restructuring.