Sega Sammy Q1 Earnings: Sales Up, Revenue Down

This week, Sega Sammy Holdings, the parent company of Sega, reported across the board declines in both sales and revenue.

In the case of the Entertainment Contents division itself–which Sega is a part of–that occurred despite moving more physical copies of games versus Q1 2018.

Overall, net sales declined by more than a third year over year to $610 million. Quarterly profit dropped an alarming 97.1 percent to just $3.1 million.

In Entertainment Contents, sales dropped some 10 percent, with revenue falling to $404 million. That’s despite an increase in physical game sales; 5.7 million were sold in the period that ended in June. That’s an increase of more than a million units versus in Q1 2018.

Sega cited Persona 5 and Yakuza 6 as key drivers behind that increase. But Sega appears to be suffering from a slump in digital sales.

It should be noted Sonic Mania Plus is not included in the Q1 figures, as it released in July. It will be part of the Q2 numbers when they’re out in the middle of Fall, as will the HD re-release of Shenmue I and II.

Another item to consider is that Sega Sammy is in the middle of relocating its flagship campus – and that too costs money. That’s likely why the company ended the week of trading on the Japanese stock market up close to five percent.