Sega Sammy Continues to Restructure Due to COVID-Related Losses
Sega Sammy Holdings is making some significant cutbacks to its company to combat lost profits due to the COVID-19 pandemic.
Sega Sammy Holdings, the parent company of Sega and Atlus and more, continues to restructure the company as a result of the effects of the COVID-19 pandemic. Sega has been mitigating lost revenue using aggressive strategies such as selling most of its arcade operations business, reducing its stake in Sanrio (the company over the popular Hello Kitty brand), and dissolving a small subsidiary. And Sega’s most recent action is now reportedly asking 650 staff members to retire early.
Below are Sega’s main financial results for its second quarter:
As noted, it faced its worst negative results in the first quarter, while it “recorded an ordinary income in the second quarter accounting period.” Due to the poorly performing first quarter, Sega faced “extraordinary losses” in its Amusement Center Operations area (the arcade machine side of Sega). However, some of that loss was mitigated thanks to the performance of its Consumer area.
Previously they announced that it would shift a significant part of its arcades game development staff to consoles. Famitsu then reached out to the company regarding the news of Sega Group selling 85.1% shares of Sega Entertainment to Genda. The shares transfer, happening on December 30th, 2020, means that most of over 200 Amusement centers and Game Centers owned by Sega in Japan will now be owned by Genda. Most likely many shops will be closed as the sale was decided on due to the crisis many shops are facing with said pandemic.
For more of an in-depth look into the ins and outs of the arcade business and why Sega made this decision and its consequences, check out this detailed breakdown from our Senior News Editor Iyane Agossah. On August 30th the company previously closed down its iconic arcade in Akihabara, the famous “electronics and otaku mecca” of Tokyo.
CEO Haruki Satomi announced at TGS 2020 during the Sega Fan Meet-up 2020, a new project titled Virtua Fighter x Esports Project. A teaser trailer was published and can be found below. In the reveal tweet, the company mentions the Virtua Fighter series is coming back for the 60th anniversary of the company, meaning the “Virtua Fighter X Esports Project” will include at least a brand new Virtua Fighter game. Additional details will be coming at a later date.