Japanese corporation posts net profit for second quarter 2012 while consumer segment's year-over-year losses drop 60%.
Sega Sammy's consumer business is still losing Yen, but the rate of hemorrhage has slowed, according to the company's second quarter 2012 financial statement. Its consumer segment (which includes video games as well as toys) posted lower sales but also lower losses compared to the same period ended June 30 of last year, in a statement indicative of overall improving health for the Japanese corporation.
Sega Sammy's consumer segment reported ¥15.1 billion in sales ($193 million) and ¥1.6 billion ($20 million) in net losses for the period ended June 30. The second quarter of 2011 saw ¥16.2 billion ($207.5 million) in sales and ¥3.9 billion ($49.4 million) in losses, meaning the company's year-to-year sales shrunk by 6.9 percent while its losses decreased by 59.6 percent. The statement reported that Sega Sammy's "structural reform policies" dictated fewer total games be made, and total sales were similarly diminished with 1.3 million copies worldwide down from 2011's 2.3 million.The company's performance has remained favorable in the mobile gaming market and it seeks to expand into social network-based games, it said.
The statement also mentioned Sega Sammy's decision "to carry out streamlining of the organization responsible for the packaged game software field in the U.S. and European markets in a bid to establish a structure that can consistently generate profit," referencing the closure of several European and Australian offices and the consolidation of their services to third parties.
Sega Sammy's combined segments posted ¥70 billion ($896 million) in sales and ¥2.5 billion ($32.6 million) in net profit for the second quarter of 2012.
Connor Sheridan is the News Intern at GameSpot in San Francisco. He loves Super Metroid and has seen "Weird Al" Yankovic in concert three times.
1 Like Sega always have been and still are awesome resonsable for games like out run, sega rally, virtua fighter, binary domain, shenmue, yakuza. jet set radio, baku baku, nights, sonic, streets of rage , shinobi and many more. its not right to see a companies that give awesome games losing money. its companies like EA and there greed we need to see lose money.
1 Like They need to make some new IP's like Valkyria Chronicles. Where's Shenmue 3? They need to forget about Sonic and create some new interesting IP if they want to get sales back up.
1 Like @blackace asking for a like for like game is asking for a new ip? why not just make a sequel if that were the case? shenmue is partly how sega got into this financial hole... that thing was a money pit.
@leviathanwing @blackace "for a like for like game" over likeing also shenmue not much of a factor in this a game from 2000 affecting sega in 2012? realy
Might not be the right division but they need to make some new IP's and stop milking there old mega drive back catalog, maybe look into new way of revamping the best games from the dreamcast and give it a complete fresh overhaul
Yet again, the consumer division has to erode profits from the Amusement Division. Here's a hint Sega: You wanna make money? Take your Arcade Managers and have them deal with everything.
It's obvious year after year that any appointed consumer manager fails to bring in any profit. If your going to lend out, instead of having to bail them out with Profit, bail them out with Ideas for new IP >.> The Amusement division seems to be doing fine despite it's niche market globally. So there isn't much excuse for failure on the consumer end.
2 Like @Mozuckint The reason that division consistently turns profit is because it`s almost all pachinko, not because they have great ideas. Commenting them on making a profit there is literally like saying a slot machine only generates profit through impressive corporate management, because that:s basically what pachinko is.
Sega has problems that need fixing, but being more like the morally and creatively bankrupt pachinko division is not the solution to them--you don`t them to out-EA EA do you?
@OJ_the_LION I'm aware of the large pachinko influence within the ranks. Perhaps I just worded the statements wrong.
I was trying to strictly refer to the AM divisions Sega has, rather than Sammy's Pachinko within it. The actual Games may not pull in as much as say the pachinko unit within it does, but they can hold their weight relative to expectation is all. The teams(AM) are either improving on existing products or coming with new products all together.
Again, I still may be wording this wrong, but I agree that directly aping the Pachinko unit is no preferred. Just ape the AM talents.
1 Like I think what Sega might to do to became more profitable is to create partnership with others major companies in the sector. For instance, with Konami or Capcom. Then trying to create new game franchises in order to leverage their brand with consumer. Look at the Microsoft case, they came without any knowledge in games business, they made the right choices and now their games are very competitive and appealing to the consumer.
What Sega needs is to gather again those creative heads who was behind Segas past great games(Gen,Sat and especially DC) to improve on their games line up this and next gen consoles.Also,if Sega plan to make remakes or collections,listen more to what gamer wants...like so much requested western release of Monster World IV. Also i think that there is a great problem with Sega of America! SoA published so many mediocre games from western developers and gave Segas japan games little to no chance :(
1 Like What's happening to SEGA today is what might happen with Nintendo and SONY in the future... if they don't manage their business carefuly. SEGA made great games in the past but keeping up with the gaming market wasn't their strong point, so, what to do but resort to sales? They are still losing money but they're alive as company at least.
@franzito You mean Microsoft and Apple. Nintendo and Sony are great companies with good business strategy and knows quality production value. Only the American companies would failed, we already saw what happened to some of the once American first parties that end up being third parties like Atari, 3DO, and Sega.
2 Like Gamers say they buy Sega Products but it's only a few number of people that the company can't see the profit in the product that cost more money for. I do believe the only profit I think Sega can see worldwide is from Sonic series and Total War series. That is why Sega can fund in the sequels.
Once again Sega is the scapegoat when it is the only major corporation in the last 5 years came with more new franchises than any companies in the game industry. The shocking thing is that they are nowhere near terrible. For all those terrible Sonic Series Sega is milking, at least this company makes up for it with the new titles nobody ever buys.
Let's say hypothetically if Sega chooses to make Valkyria Chronicles 3 on PS3, I'm confident only a collect few will actually buy the freaking game. And it really doesn't matter if it's any other title or different genres. I've been observing Sega for a while, all I saw from gamers are their unrealistic expectations and excuses for not supporting them.
I have to agree with people that Sega has no business in talking about releasing consoles when their software sales are subpar.
1 Like I stopped caring about Sega after they pretty much killed the Valkyria Chronicles series in the US.
1 Like Sega losing money? All they got to do was released Sonic 4: Episode 2 (even if it would suck or not) on Wii and they'll rake in cash. The first game of Sonic 4 was the best seller on Wii and they choose not to do it. Also with them only releasing Phantasy Star Online 2 exclusively for Vita and PC won't help them in the long run. There are more Phantasy Star Online players who just wanted to play the game on a true gaming consoles like PS3, Xbox 360, and/or Wii U over the any PC and Vita version.
1 Like @leeko_link Phantasy Star Online 2 will NEVER come to any of the platformers simply because there aren't enough people that will bother.
740,000 subs in one month in Japan, shows where the market and user base is at. PC gamers and consumers.
Also, I am very mortfied by these comments. This debate hear is filled with hyperpole,uniformed, ideological nonsense. SEGA is profiting from DOMESTIC product not just panchinko machines. Basically None of you have a single clue what you are talking about. You know NOTHING about SEGA and are only looking at them from a western point of view.
I'd say your alll uninformed and only care about yourselfs, not about SEGA. You could care less, I'll repeat what I said " Gamers here only care about SEGA's IPs and want exclusivity to their favorite platform.
Sega Orbi Enterprises will soon show how much everyone here has underestimated Sega. Only SoildTy and Thom seem to understand that Sega has had 3 and a half years of being in black.
1 Like @LindBergh2007 Another year of EPIC FAIL for Lindburgh2007..LOL!
Oh BTW I checked that dumb trademark you keep spamming everywhere. The US trademark office refused to grant it and Sega will need to provide further clarification if they want the application to go through. They have till 9/27/12 to respond to the USPTO or the application will be suspended.
So much for your new company...lol
1 Like @LindBergh2007 "alll" lol pso2 is a free to play noob and orbi is a dum holding cop rebrand because sammy not much of an enty
1 Like Oh no! Sega losing money still!
Oh... wait... I actually expected them to be losing a LOT more. Keep the recovery, Sega!
@SolidTy Correct. Cutting down all packaged media for the past 3 years has paid off for SegaSammy. Becoming Sega Orbi and opening up all sorts of non gaming venues will bring massive revenue for Kabushiki Kaisha Sega.
No wonder there will never be the next Sega console , becuase their business is going down.
@interrasteral7 (Rolls Eyes) Clearly didn't read the article and will soon be proven wrong by Sega Orbi.
Also, Sony will be leaving the hardware business soon. Losses are WAY larger over at Playstation land. They only have $2 billion left to spend on SCEI alone.
What are you talking about? Sega has never announce that they are making a new console.
@interrasteral7 he thinks sum BS TM meant sega was making a new console and spammed on any site he could find
1 Like @LindBergh2007 lol why would sony kill the working part of them oh right your a fanboy
@LindBergh2007 my point why make HARD ware then SOFT ware which only ELECTRONIC hell sega last arcade system that was all them was NAOMI all they have done HARD ware wise is ape xbox and pc HARD ware
5 Like @LindBergh2007 No Lindburgh2007 we make fun of you because you make up false BS in a pathetic attempt to look like you know what you are talking about.
Then when people correct you, you throw a hissy fit and start calling them trolls etc.
Sega is one of my most favourite game companies but they haven't really released any games recently? Rhythm Thief came out though I should probably go get that game!
@Vickman178 They have. It just that nobody pays attention to them. And many brand loyalists fight over exclusive ownership of their properties. I can't even name the amount of Nintendo fanboys who are dumb enough to think Sega is owned by them or that Nintendo should waste HALF their net worth on purchasing a $23 billion dollar Arcade giant.
It is quite unfortunate to hear Sega Sammy continue to bleed money, but at least it is not serious to what is happening to Sony.
@thom_maytees SegaSammy Holdings, Inc is being disbanded and being reformed into a newly wholy owned subsidiarity after years of taking Operating losses on consumer video games hardly anyone bothers to take a look at.
Sega Networks is taking over the consumer video game division for Sega.
Sega Orbi Enterprises is a REAL company. Its formation will take place at the end of the summer.
As for Sony, they are on the complete and total meltdown. Mostly all their divisions are seeing red. Only Playstation is profiting, but not enough to sustain them as a hardware brand. Way less then a decade ago.
1 Like Sega, get your mind together and ask a partnership with Team Ninja and release Virtua Fighter VS Dead or Alive...
2 Like Need to generate a quick $20M Sega? Pulls your heads out and release Platinum Games' Anarchy Reigns outside of Japan like you should have earlier this month!
The game got four 9/10s from Famitsu and looks awesome. And it is already 100% done and localized for global release!
@TheGreatOne023 How many people do you know would buy Sega brand titles for their 360 and PS3?
@LindBergh2007 @TheGreatOne023 How many people would buy a mario game built for next gen Xbox, PS. And yes Sonic can be Mario.
@deviant74 @TheGreatOne023 Sega's plan for extra profit in addition to restablishing their 1st party brand and new digital only 3rd party brand? Set up dozens of different NON gaming franchising brands and subsidiarities that shall handle all sorts of consumer products from selling Casino Slots overseas, to selling bathroom products, manufacturing secondary electronics, Franchising for popular Hotel, Restaurant and Theater brands like Marriott,Hilton,IHOP,Olive Garden,Edwards,Cinemark, selling linen,manufacturing appliances for industrial brands, selling Steel and Manufacturing material for assembly factories just to name a few.
That's what the brand "ORBI" will be made of.
@LindBergh2007 @TheGreatOne023 Hemorrhaging money, stop making consoles, stop 3rd party games. Just make facebook games. No matter what in the end Sega is going to have to put out a great game that makes money. Split the game up into 4 parts do a small beta test (1000 people) let them play the first part for free. If they want they can pay $20 for the next part. If you can get 70% of the beta to buy the next 3 parts at $20 each You will have made the perfect game.
1 Like @deviant74 @TheGreatOne023 Yakuza is a VERY popular franchise in Japan for a reason. Its because it has ingenuity. Call of Duty lacks that. Its nothing but the same rehashed shit. Bayonetta is popular because its completely original. Nothing like Mass Effect.
People beg SEGA to localize games for their consoles, but most never buy them. They just ignore them. Going digital only will save SEGA millions and millions in budget. In fact this time next year, they won't be hemorrhaging money, they'll see returns.
@LindBergh2007 @TheGreatOne023 I played the demos. I didn't think they were that great. Why do you think they were so good?
1 Like @deviant74 @TheGreatOne023 If people BROUGHT SEGA's titles, they wouldn't be pulling out of the 3rd party business.
No, instead, people buy Call of Duty or Mass Effect. Great games like Yakuza and Bayonetta get igroned.
Company canning unnamed games as part of shift to become smaller and strengthen digital content; full-year financial outlook cut in half.
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