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Sega's H1 games results stagnate on lack of new releases

New Football Manager and Total War games promise a stronger H2

Sega's video game revenues were stagnant in the first half of the fiscal year, with a lack of big new games to make an impact on the company's bottom line.

In the six months ended September 30, 2018, Sega earned ¥26.7 billion ($236 million) from packaged sales, slightly down from ¥27.1 billion ($240 million) a year ago. Digital games revenue remained flat year-on-year at ¥19.3 billion ($171 million).

Operating profit from packaged sales stood at ¥4.4 billion ($39 million) for the period, up from ¥3.5 billion ($31 million) year-on-year. However, digital games went from a ¥2 billion ($17.8 million) operating profit to a ¥1.4 billion ($12.4 million) loss.

The reason for the loss was the delay of unspecified games that were due for release in the first half of the year. The impact of those delays was partially offset by "robust" sales of the PS4 title Border Break.

Unit sales of packaged games increased year-on-year, from 8.6 million to 11.2 million. This was mostly down to catalogue titles, Sega said, with Sonic Mania Plus, Ryu ga Gotoku 3, and Shenmue I & II singled out for their performance.

Sega now reports its video game results as part of a broader Entertainment Contents category that includes amusement machines and centres, and animated films and toys. Overall, the division earned ¥107 billion ($947 million) in revenue, up 5.6% over the prior year, and ¥6.2 billion ($55 million) in operating profit, down 39%.

Sega has a relatively busy second half of the fiscal year, with Football Manager 2019, Total War: Three Kingdoms, and a new IP from its Yakuza studio with the working title "Project Judge" all set for launch.

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Matthew Handrahan avatar
Matthew Handrahan: Matthew Handrahan joined GamesIndustry in 2011, bringing long-form feature-writing experience to the team as well as a deep understanding of the video game development business. He previously spent more than five years at award-winning magazine gamesTM.
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