It’s capable of ‘motion capture-informed procedural animation’, which basically means the engine automates animation adjustments based on parameters.
Yes lots of tech fancy words were used no doubt, but what really matters is that Square Enix has been working super hard to give us amazing visuals without killing our hardware. It natively supports DirectX 11 and uses tessellation to boost textures.
The Luminous motion capture for character animation consults a database of information, which allows the engine to automate adjustments needed to models. If an artist repositioned a NPCs arms then Luminous will adjust the rest of the body to compensate.
Give a character a heavier weapon than a lighter one and Luminous would again compensate by adjusting how the model interacts. This also applies to terrain types for walking.
Coding wise, Square say it supports advanced and scalable AI. So far no videogame project solely based on Luminous has been announced by Square Enix, however select parts of the technology will play a role in Final Fantasy Versus XIII.
The Luminous engine is said to be current-gen compatible.