Square Soft's first games were released for the Nintendo Family Computer (also known as the "Famicom," and known internationally as the Nintendo Entertainment System) and the Square Soft's first games were released for the Nintendo Family Computer (also known as the "Famicom," and known internationally as the Nintendo Entertainment System) and the Famicom Disk System.
Their early games were not very successful, and by 1987 the company was faced with the possibility of bankruptcy. That same year, Square employee Hironobu Sakaguchi was charged with the creation of a game that might well prove to be the company's last. The result was Final Fantasy, a computer role-playing game for the Famicom.Sakaguchi, who was considering retiring after the production of the game, named it "Final Fantasy", a reference to the game being his last as well as his exit from the gaming industry.
The game was successful, however, and returned the corporation to profitability. Final Fantasy did much better than Sakaguchi and Square had hoped, and led to a North American distribution deal with Nintendo of America, who released to market Final Fantasy in the United States in 1990. Due to its success, Hironobu Sakaguchi's plans for retirement ended and he stayed at Square to develop new Final Fantasy games. It may also be possible that the reason every new Final Fantasy game has a new story, with new characters, is because the original Final Fantasy game was created with the belief that a sequel would never be created.
Final Fantasy was followed by a sequel of sorts in 1988, marketed exclusively in Japan until Final Fantasy Origins. North American localization was originally planned for the Famicom version of the sequel, but given the age of the game at that point, and the imminent arrival of Nintendo's Super Famicom (known internationally as the Super Nintendo Entertainment System), it was abandoned in favor of the Super Famicom Final Fantasy IV.
Square has also made other widely known games such as Chrono Trigger, Secret of Mana, Seiken Densetsu 3, Xenogears, Brave Fencer Musashi, Parasite Eve, Parasite Eve 2, Vagrant Story, Kingdom Hearts (done in collaboration with Disney Interactive) and, Super Mario RPG: Legend of the Seven Stars.
Square was one of the many companies that had planned to develop and publish their games for the Nintendo 64, but with the cheaper costs associated with developing games on CDs for the Sony PlayStation, the games were instead made for Playstation. Final Fantasy VII was one of these games, and it sold 9.8 million copies, making it the second best selling game for the Playstation.
A merger between Square and its competitor Enix was in consideration since at least 2000; however, the financial failure of Final Fantasy: The Spirits Within made Enix hesitant to join with a company that loses money, and the merge was delayed until April 1, 2003, when the two companies finally merged to form Square Enix.