Sega's sales of full games amounting to $102.5 million have played a crucial role in mitigating the company's overall revenue decline

Sega's financial disclosures for the quarter ending June 30, 2024, reveal a mixed performance, with overall net sales declining, though its gaming division demonstrated robust results.

The company reported ¥15.1 billion ($102.5 million) in revenue from complete game sales, marking a nearly 40% growth from the previous year's corresponding quarter. The Entertainment Contents division, which includes video games, toys, and animation, experienced a 34% increase in sales, totaling ¥72.7 billion ($493.3 million).

The numbers

Net sales: ¥104.7 billion ($710.5 million, down 3.2% year-over-year)
Entertainment Contents net sales: ¥72.7 billion ($493.3 million, up 34%)

The highlights

Sega Sammy observed decreases in net sales and profits when compared to the last year, influenced by the previous year's launch of Smart Pachislot Hokuto No Ken. Specifically, the pachislot and pachinko segment's net sales dropped 43% year-on-year to ¥28.8 billion ($195.8 million).

On the other hand, the Entertainment Contents sector saw increased sales and profit, surpassing expectations due to significant DLC sales and beneficial foreign exchange rates.

Despite the year-on-year growth in full game sales, the 5.9 million units sold fell slightly short of projections. Among these, 710,000 units were from new releases, with Shin Megami Tensei V Vengeance standing out as a significant title with 500,000 copies sold.

New game launches generated ¥3.9 billion ($26.5 million), while older games contributed ¥11.2 billion ($76 million). The company also noted strong performances from games like Unicorn Overlord and the Persona 5 Royal remaster.

Part of the profit growth in video games can be attributed to the acquisition of Rovio, known for Angry Birds. Sega finalized this acquisition in August 2023 in a €706 million deal.

In other areas of Entertainment Contents, revenues were bolstered by Sonic The Hedgehog movie-related sales.

Looking ahead, Sega expects continued strength in Entertainment Contents, with upcoming launches including Sonic X Shadow Generations, the free-to-play Sonic Rumble, and a new title from Atlus, Metaphor: ReFantazio. Additionally, the third Sonic The Hedgehog movie is set for release on December 20, 2024.

The company provided an update on its medium-term management strategy announced in May. A new Gaming Business was established to oversee casino and iGaming products.

To support this strategy, Sega Sammy completed two significant acquisitions: GAN Limited, a U.S.-based B2B platform for casinos, acquired in November, and Stakelogic from the Netherlands, a developer of B2B iGaming content, announced last month.