Sega expects losses of $55 million at the end of the fiscal year

The gaming segment brings the company less and less money.

Catherine: Full Body
The mobile games market is very fickle.

Because of this, Sega expects huge losses this fiscal year. She reports this in her report for the three fiscal quarters that ended on December 31.

In April— December last year, total revenue from all Sega divisions fell by 4% year-on-year to $2.3 billion.
For the above nine months, the operating profit of the entire Sega entertainment segment amounted to $96.5 million. This is $60 million less than last year.
Revenue from physical gaming retail fell to $397 million. But operating profit rose to $73.8 million. We add that for three financial quarters Sega sold 18.5 thousand physical copies of games. This is four thousand more than in the same period last year.
At the same time, operating profit from digital downloads collapsed by $54.6 million. The loss is $24.5 million. Revenue from digital copies of games totaled $267 million — just $5 million more than the year before.
At the end of the fiscal year, Sega expects a loss of $55 million. The company named two reasons for the decline in financial indicators: actually unprofitable mobile titles plus increasing competition in the Japanese mobile games market.
Sega planned to increase revenue by releasing new games in the last fiscal quarter — Total War: THREE KINGDOMS and Catherine: Full Body. But now he admits that they will not help compensate for the decline in sales of existing titles.
However, Sega noted that there is an opportunity to earn not only on its own IP, but also on crossovers with third-party IP. The company also plans to fine-tune the internal game development process to make them more profitable.

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