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Sega ekes out a profit as video game division sees losses

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Pachinko, pachislot and arcades put Sega in the black.

Star Horse 3
Star Horse 3

Sega Sammy posts $895 million quarter, $20 million in net income as game sales slide.

Sega's consumer games business, including console, PC and mobile games, was certainly not the highlight of Sega Sammy Holdings' most recent fiscal quarter. Instead, Sega Sammy managed to have a profitable quarter due to increased sales from its pachinko, pachislot and amusement center businesses.

During the quarter ended June 30th, Sega Sammy saw net sales of ¥69.98 billion ($894.9 million) with net income of ¥2.544 billion ($32.5 million). That's a marked improvement from the same quarter last year, in which Sega Sammy experienced a net loss of ¥2.224 billion ($28.4 million).

Tokyo-based Sega Sammy highlighted strong sales of pachislot games based on the Monster Hunter and The Idolmaster video game series; sales of pachinko games based on Yakuza and Fist of the North Star; and card-based horse racing sim StarHorse3 Season Ⅰ: A New Legend Begins. Sega Sammy reported strong but slightly lower performance at its 240 arcades and amusement centers.

Sega's consumer video game business saw a decline in sales of packaged goods, with 1.34 million games sold during the quarter. The company was much more positive on sales of its downloadable titles, pointing to "brisk sales" of PC game Phantasy Star Online 2 and 3 million downloads of smartphone title Kingdom Quest.

In March, Sega posted a 7.1 billion ($91 million) annual loss, leading to a restructuring of the company that saw the software maker focus on digital releases and four key game franchises — Sonic the Hedgehog, Total War, Aliens and Football Manager. In June, Sega shuttered offices throughout Europe and Australia as part of its consolidation plans.