From FGN Online this morning comes reports that Square is suffering its first major financial losses ever. Now, Square may have more reasons to want to align themselves with Nintedo and Microsoft instead of siding only with Sony. The massive budget for the Final Fantasy movie, The Spirits Within is being blamed as one of the reasons for the losses.

President Tomoyuki Takechi, Vice President Hironobu Sakaguchi and CEO Masashi have all announced their resignations. However, the three men won't be leaving the company completely and instead are being somewhat demoted. Takechi will become a contractual consultant, Sakaguchi will be an executive producer and Hiramatsu will take the position of executive director.

Whether or not our recent story on Square's response to Nintendo is completely accurate, there's no doubt that Square will have to play to Nintendo's tune. It looks like Yamauchi is holding all the cards here.