Gotta say, I LOLed when I saw hardware sales this week.  I really thought PS5 would be the #1 seller, but Switch sales went up too for no apparent reason.  Oh Japan, you so crazy, the way your hardware and software sales are totally unrelated.

Not portable enough.

In the 90's Playstation was the right choice, they should have went to Switch instead or just bank on the West. PS5 software is pretty much dead in Japan. Not just FF, but also games that once catered to the Japanese audience like Persona, Infinite Wealth, Granblue, Tekken and Resident Evil just sell terrible on PS5. Basically if a game is on a non portable platform don't expect sales to lift off.

FF are the best selling titles on PS5 and even the numbers of these titles are terrible. Luckily it seems to be doing well in UK and Spain. The west is carrying this franchise and all JRPG's not on Switch and I expect the situation to only worsen. If you want your game to sell well in Japan go for a Switch launch or maybe be Monster hunter, though I expect that game to terrible compared to World as well on PS5.

Like this game could run on the Switch or boxed sales on Xbox/PC would have made the numbers on this chart any better. This franchise has been in decline in Japan for a while and Japanese gamers simply don't like what the series has turned in too, since sales are also a fair bit lower than FF16.

Software sales on PS5 in Japan have also been terrible for a long time.

It's interesting to see that XIII did much bettter than XV and subsequent titles despite a much smaller userbase than XV, VII R, XVI and VII Rebirth. It was the last non action ATB/turn- based game.

Honestly you reap what you sow. Sony raised the prices of their AAA games at the start of the gen. Then after a year or 2 they raised the price of the PS5. Then they raised the price of PS Plus. If they expect raising prices will lead to more sales, they are wrong.

In addition Sony said recently or a representative heard that Sony doesn't want to make JRPGs, which is actively ignoring their Japanese fanbase. Consumer confidence in Sony is not great in Japan.

Exclusivity doesn't really explain the decline though. VII Rebirth is down compared to XVI which was also a PS5 exclusive and on a smaller userbase. XVI is massively down on XV despite XBox being a non-factor in XV's launch numbers, so essentially the sales are exclusively from PS4.

Even on Playstations Japanese audience FF is loosing appeal. 

PS5's reported hardware sales are not a problem. It's the fast selling Playstation in 2 decades. The weekly hardware numbers seems mostly disconnected from big releases as we saw last year. 

The issue is how many PS5s are staying in Japan, how that impacts software sales and the figuring out whatever else is causing the low software to hardware ratio (obviously physical is only half the picture)

I will defend Square Enix for a moment.

I don't think SE has some crazy favouritism towards Playstation. They never considered releasing a mainline FF on Switch purely because it's specs do not serve their ambitions for the mainline games, same reason why they left Nintendo during the N64 era. FFXV launched right around the time of Switch & was multiplatform but they never invested or considered a port, they simply do not have interest in porting down their games... it would have broken the vision they have for that game and every other mainline FF.

In Squares mind Playstation was the only real console option for Japan. Xbox multiplat sales potential is highly overestimated (Has any JRPG sold more than 1m globally on Xbox?) and I think PC is only just proving itself in terms of being a major market for the genre, but we still don't have any concrete numbers there. Switch 2 will be a turning point in my mind as Nintendo will finally release hardware which is both popular and capable enough to run modern games at decent settings.

Lastly Final Fantasy's decline is related to more than just platform. I mean Monster Hunter Worlds' Japanese retail launch more than doubled Final Fantasy's VII R & XV's sales. And all those (MHW) sales were from Playstation. The FF franchise isn't capturing Japanese audiences like it used to, regardless of platform.

I really expected this to be the first week since week 4 that PS5 would top Switch.

That's a fair take. Final Fantasy is SE's flagship, they feel it should be the tech powerhouse title and acted like that. PlayStation was the obvious home in that strategy. For Nintendo they made games like Bravery Default to try not alienate that audience.

The question now is if SE should reconsider how they position their flagship franchise. Many franchises have tried to re-invent themselves either before or after they where forced to. Some refused and wittered away. I think SE needs to take a good hard look and that could lead to going back to basics. I mean Persona is a worldwide hit now. Classic turn based, just more stylish.

Imagine FF being classic Turn based with the graphics it can do today!