Yes, but after calculating the overall development costs leading up to this point, how long does it take them to break even on that? $1.4 million, minus staff wages and server upkeep, etc, then put what is left towards some ungodly number. They'll need years of solid growth / retention, not just floating.
That's where you're wrong. SE owns the title entirely meaning there's no debt to repay except their own profit margin. They can swallow the redevelopment a hit in the profits of the company and just let FFXIV coast on it's normal development budget - cashing in solely on the 'redemption' value that will impact their console game sales while FFXIV takes itself slowly out of the red.
Profit in SE is pretty much viewed in total assets, not singular assets. Ones the initial investment cost for FFXIV is finished - so long as they mantain a stable population, they'll make great profits from the game even after pulling it out of the red.
SE has slated a 10 year life span intent for this game, which means they've already a goal subscription number and budget for the next 10 years in mind.
Remember, had this been any other company, with the exception of blizzard, the game likely would have floped and just went FTP. But SE has the money to burn and they burned it. They can afford to plot long-term small gains for large initial losses, especially consitering they already have FFXI - who's profits have already paid for the development and re-development of FFXIV twofold. That's not including the licensed and in-house console projects that sold well in spite of bad reception.
As a business, they can afford to let this one slow-cook. They're likely aiming for much higher than that ideally. However, they've likely already made the realistic projections and budgeted accordingly.
Edited, Mar 14th 2013 11:05pm by Hyrist