Sakaguchi had plans to retire after the completion of the project so he named it Final Fantasy because it was his final game, although it was also going to be Square's final game. It's commonly believed that the game was named Final Fantasy because of Square and not Sakaguchi, although Sakaguchi himself has confirmed it was named because of his plans for retirement.
According to that statement, which supposedly came from Sakaguchi himself, it was going to be named Final Fantasy regardless of whether or not it was going to be Square's last game.