Sega's second-quarter financial performance surpassed predictions, boosted by a significant increase in operating income from its pachislot and pachinko machine business
Sega has reported impressive second quarter performance for 2026, largely due to a significant 331.6% boost in operating income from its pachislot and pachinko machines division.
Even though revenue in the Entertainment Contents division fell by 2.4% to ¥145.1 billion ($916.8 million), it still surpassed forecasts.
Key Financials
Quarter ending September 30, 2026
- Net sales: ¥212.5 billion ($1.3 billion), a 5.6% increase from the previous year
- Entertainment Contents net sales (games included): ¥145.1 billion ($916.8 million), a decline of 2.4%
- Operating income: ¥14.2 billion ($89.7 million), up by 42% compared to last year
Performance Insights
Sega experienced a 23.5% drop in full game sales to ¥20.5 billion ($129.5 million), compared to ¥26.8 billion ($169.3 million) during the same period last year. Despite this, 10.6 million game units were sold this quarter, increasing from 9.3 million units year-on-year.
Revenue from new game titles was ¥0.3 billion ($1.8 million), significantly lower than the prior year's ¥8.7 billion ($54.9 million). Meanwhile, catalogue sales rose by 12.2% to ¥20.2 billion ($127.6 million) from ¥18 billion ($113.7 million).
Sales from free-to-play games slightly missed expectations, falling by 3.3% to ¥26.0 billion ($164.3 million). On the other hand, DLC and subscription services maintained stable performance, and Rovio generally met expectations.
Earlier this year, Angry Birds' creative officer, Ben Mattes, discussed life at Sega in the wake of its $776 million acquisition in 2023 and the following $200 million impairment.
Mattes stated, "They know that we're a transmedia company. They know that we're a mobile-first company. They know that they've had successes with Sonic. They know that they want to grow their mobile expertise."
He continued, "The goal from the outset has been to elevate Angry Birds to a level comparable to Sonic in terms of transmedia presence and expand both Rovio's mobile free-to-play business and Sega's overall mobile and live-ops capabilities."
Going forward, Sega predicts growth in new title sales and increased licensing income through planned expansions in sales and transmedia strategies. Upcoming titles Stranger Than Heaven and Persona 4 Revival are seeing favorable trends in wishlists.
Stranger Than Heaven, set for a January 2027 release, has over a million wishlists, surpassing similar pre-launch titles, with new users making up about half of these registrations.
For Persona 4 Revival, scheduled for February 2027, wishlist figures have crossed two million, also outperforming comparable pre-release titles. Many registrants have previously purchased multiple series titles.