In SEGA’s first report since the recent news of the restructuring of their consumer division, this was always bound to be an interesting report. The numbers show a very mixed picture for the group as the Pachinko and Pachislot segment operating profits (¥71 billion yen/$889.4 million) and arcade sales (¥7.4 billion/$92.8 million) were quite healthy whilst amusement centres posted minor operating profits (¥355 million/$4.4 million) but the consumer division fared less well, hit back after the break to find out how much money SEGA’s consumer division lost for them.
SEGA’s consumer division gave a big hit on the group’s operating finances (Although considering the amount of money Pachinko & Pachislot’s produce, perhaps it’s closer to a minor jab) with an operating loss of a staggering ¥15.1 billion/$189 million. It is worthwhile to note that one of the reasons for the loss is the ¥345 million for impairment loss and ¥6,308 billion reconstructing loss incurred. Adding to poor video game sales in America and Europe and combining with weak sales for the SEGA Toys division have all had a hand in contributing to the biggest loss the division has suffered since the creation of SEGA Sammy.
Software sales for the division saw them post 3 million sellers in the form of Mario & Sonic at the London Olympic Games 2012 (Wii/3DS) (3.28 million) Sonic Generations (PS3/360/3DS/PC) (1.85 million) and Virtua Tennis 4 (PS3/360/Wii/PC/PSVita) (1 million) other titles SEGA included in their report were Football Manager 2012 (PC/PSP) (710,000) and Yakuza: Dead Souls (PS3) (550,000) with the group managing to sell 17.2 million copies of software worldwide. Europe was the biggest buyer with 8.3 million units sold, followed by the United States and 2.8 million units sold in Japan.
What is most interesting though is the future of SEGA’s consumer division. Package goods are going to become quite rare as SEGA is aiming to generate half of their revenue through the digital model. Infact after the Playstation 3, the PC is set to have the most developed SEGA titles for the up and coming financial year and the first time the PC has had so many SEGA titles assigned to it in the history of the company, as far as ratio to other consoles is concerned.
Finally reporting on the profitable part of SEGA, arcade sales help contributed a respectful operating profit of ¥7.4 billion/$92.8 million. No surprise at the biggest earner of money for SEGA as the highly addictive (As far as Japanese players are concerned) StarHorse3 Season I A NEW LEGEND BEGINS ¥10.1 billion. The horse racing sim has been a major boost for SEGA’s arcade sales as the series continues to post impressive figures for the developer. Other arcade titles WORLD CLUB Champion Football Series (¥3.6 billion) SEGA Network Mahjong MJ5 (¥2.8 billion) Border Break (¥2.3 billion) and Sengoku Taisen (¥1.2 billion)
And that concludes this edition of SEGA Sammy’s financial report. Overall it seems the arcade division has put its house in order and now it is upto SEGA’s consumer division to do the same. The following year SEGA is expecting to release half the amount of packaged goods as they did this prior year, however they are expecting digital sales to more than make up for it, with their revenues evenly split between the two business models. This certainly means that SEGA fans might expect more high profile digital releases as we have recently seen such as Sonic CD, The House of the Dead 3 and 4 as well as SEGA’s major arcade title finally hitting consoles, Virtua Fighter 5 Final Showdown. With the up and coming year also featuring Phantasy Star Online 2 and Aliens: Colonial Marines, SEGA would hope that they could have more titles that would help them deliver an operating profit next year.
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So over all, not as bad as it seemed at the end of March then?
Its not too bad, its not too good, it’s just bad.
SEGA’s arcade division has been losing them a large amount of money but has now been making money for the group the last two fiscal year. Their amusement centres continue to post minor profit so this is something that would be adjusted. As far as the future goes for the arcade division though, it is quite bright.
The consumer division is a real wild card but if they manage to post profit for the up and coming fiscal year, then it would mean it is a change that has proved successful. All the expensive projects that would probably have been too risky has been expensive and only projects that are expected to make money (Yakuza, Sonic, Puyo, Football Manager etc) have been green lit as packaged goods. So expect SEGA to make money on those titles.
It is the digital titles, such as Sonic 4, Virtua Fighter, The House of the Dead etc and how profitable they are that would ultimately shape SEGA’s next financial briefing.
You know SEGA is doing shit when their best selling and most profitable business is Pachinko, ouch…lol
Well this news is actually quite good in comparison to before you have to admit.
Indeed
What I don’t get is that apparently the retail games sell the most in Europe and the least in Japan, and yet SEGA won’t release some of their franchises in Europe but continue to do so in Japan where they are hardly making big numbers…SEGA being SEGA I guess…
Being dumb you mean?
I thought this was actually quite good news, well not good in that sense, but good in the sense that the news wasn’t as bad as before.
This eases anxieties somewhat..