SEGA Financials are Horrible

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SEGA Financials are Horrible

Postby Jeff » Wed Aug 05, 2015 11:48 am

http://www.forbes.com/sites/olliebarder ... g-mistake/

In an interesting development Sega reported a sizable plummet in their sales figures, to the tune of 42%. It’s looking like their recent shift to mobile and PC wasn’t such a great idea after all.

The most recent financial earnings report lists a drop of 52.9 billion yen ($426 million), which is a massive amount of money for any games publisher. Sega’s official line on this lays blame more at the general economic climate as they explain, “The economy still remained in the condition requiring further time for full recovery due to uncertainty towards a downswing in overseas economies arising from factors such as the slowdown of growth in the economies of emerging countries and the European debt crisis.”

Personally I am not convinced that global economic trends are solely responsible for Sega’s misfortune, otherwise we’d have heard similar horror stories from other publishers. While I’m not ruling that out quite yet it seems that the timing of all this is rather telling.


If you remember the president of Sega Games recently spoke out about getting back to the company’s core business of making quality console games again. With the current financial situation of the company now laid bare, it’s clear why this shift needs to happen.

At the start of the year Sega laid off a lot of people and decided to switch the focus of the company over to freemium based mobile and PC games. It’s eminently clear that strategy has not paid off.

This is not to say that freemium games aren’t lucrative but they require a different service orientated skillset in terms of their creation. Not to mention that the freemium market is currently saturated, as well as beginning the start of a downturn.

When big freemium mobile game service providers like DeNA starting to branch out and look for an escape route, such as their partnering with Nintendo , it’s time to reappraise your place on the freemium bandwagon.

Sega it seems came to the freemium party a fair few years too late and are now paying the price for that.

Personally I also think there is a lot of hype surrounding freemium in the financial layer of the games industry and Sega blindly bought into it as well.

Either way these financial results for Sega are dire. I can only hope that they can get their affairs in order and get back to what the used to do so well; making amazing console and arcade games.
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Re: SEGA Financials are Horrible

Postby Bambi » Wed Aug 05, 2015 12:42 pm

Jeff wrote:I can only hope that they can get their affairs in order and get back to what the used to do so well; making amazing console.[/i]

That's a terrible idea.
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Re: SEGA Financials are Horrible

Postby Monkei » Wed Aug 05, 2015 12:55 pm

^ I think the author is talking about console games there. :)

Serves them right for being shit, I guess. I'm looking forward to whatever they have in store for TGS, though. Maybe they'll actually deliver on that promise.
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Re: SEGA Financials are Horrible

Postby Sonikku » Wed Aug 05, 2015 3:54 pm

Bah. I wish they had sold themselves to Nintendo or something following the Dreamcast bust. That's when everything Sega started going sour quality wise. Sonic Generations and Heroes are about the only sega titles I've bought in the last decade.
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Re: SEGA Financials are Horrible

Postby amiga1200 » Wed Aug 05, 2015 4:24 pm

no surprises really.
...
still, if sega DID produce physical hardware again (which i very much doubt, assets up the khyber along with most of the old userbase) i'd bang in for it.
not like they have a bad hardware history...that was cut short, it's the fuckheads up top that think they know us all, and clearly fail in their futile attempts to state that. :cry: (don't try to know us all, just most. your flair has gone, and should you find it back, i fear it won't be sega as i and many knew of it. times change, if we have to get in line, so do they, quid pro quo.)
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Re: SEGA Financials are Horrible

Postby Hyo Razuki » Wed Aug 05, 2015 4:32 pm

Sonikku wrote: Bah. I wish they had sold themselves to Nintendo or something following the Dreamcast bust. That's when everything Sega started going sour quality wise. Sonic Generations and Heroes are about the only sega titles I've bought in the last decade.


Heroes was horrible! It ruined the franchise for me. Don't get me started on that disgusting thing. :)

Don't know if I would like to see Sega being part of Nintendo. :) Especially since Nintendo have had their own troubles as well. Gamecube was kind of a dissapointment already, Wii was a huge success but Wii U has been the worst-selling Nintedo home console ever so far and is doing quite poorly in comparison to Xbox One and PS4.

But I guess Sega deserve it anyway. I hope they'll turn their focus back to console and arcade games now and focus on quality rather than quantity.
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Re: SEGA Financials are Horrible

Postby Riku Rose » Wed Aug 05, 2015 5:00 pm

I just don't understand where all that money is going. It's not like SEGA have had 3 games last year with AAA budgets that's have flopped. Even if Sonic games aren't selling quite how they used to I doubt they cost an arm and a leg to make. Having just looked at a list of games they made in the last financial year the only games I can imagine cost over $10m is Yakuza 0 and Alien Isolation. Then you have all the Mega Drives rereleases, Football Manager and Total War series which can't cost them much and must bring in a tidy sum.

I also don't ever remember a year that I haven't seen a news story about how they've lost tons of money. I'm just not sure how they're still in business and not something like how Atari are now.

I'd seriously be fascinated to have a chat with their accountant as there is something going on there that I am unaware of.
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Re: SEGA Financials are Horrible

Postby Amir » Wed Aug 05, 2015 5:24 pm

Riku Rose wrote: I just don't understand where all that money is going. It's not like SEGA have had 3 games last year with AAA budgets that's have flopped. Even if Sonic games aren't selling quite how they used to I doubt they cost an arm and a leg to make. Having just looked at a list of games they made in the last financial year the only games I can imagine cost over $10m is Yakuza 0 and Alien Isolation. Then you have all the Mega Drives rereleases, Football Manager and Total War series which can't cost them much and must bring in a tidy sum.

I also don't ever remember a year that I haven't seen a news story about how they've lost tons of money. I'm just not sure how they're still in business and not something like how Atari are now.

I'd seriously be fascinated to have a chat with their accountant as there is something going on there that I am unaware of.


It says a drop in sales so I think they still made a net profit, just not as much as previous years for whatever reason.
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Re: SEGA Financials are Horrible

Postby Hyo Razuki » Thu Aug 06, 2015 4:16 am

Didn't that Sonic Boom thing cost them a shitload of money to make? I don't know how on earth a friggin Sonic game could be expensive to make, but I've read about Boom having like a 20 or 30 million $ budget somewhere...
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Re: SEGA Financials are Horrible

Postby south carmain » Thu Aug 06, 2015 6:19 am

Hyo Razuki wrote:Didn't that Sonic Boom thing cost them a shitload of money to make? I don't know how on earth a friggin Sonic game could be expensive to make, but I've read about Boom having like a 20 or 30 million $ budget somewhere...

Maybe that included the cartoon costs too?

It's certainly not the testing that brought the price up anyway.
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Re: SEGA Financials are Horrible

Postby Hyo Razuki » Thu Aug 06, 2015 10:18 am

No, they don't talk about any cartoon here: http://www.tssznews.com/2014/02/21/sonic-boom-game-near-a-20-million-budget/

But you're right. It was definitely not Q & A which made it cost 20 million.
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Re: SEGA Financials are Horrible

Postby Sonikku » Thu Aug 06, 2015 10:58 am

Hyo Razuki wrote:
Sonikku wrote: Bah. I wish they had sold themselves to Nintendo or something following the Dreamcast bust. That's when everything Sega started going sour quality wise. Sonic Generations and Heroes are about the only sega titles I've bought in the last decade.


Heroes was horrible! It ruined the franchise for me. Don't get me started on that disgusting thing. :)

Don't know if I would like to see Sega being part of Nintendo. :) Especially since Nintendo have had their own troubles as well. Gamecube was kind of a dissapointment already, Wii was a huge success but Wii U has been the worst-selling Nintedo home console ever so far and is doing quite poorly in comparison to Xbox One and PS4.

But I guess Sega deserve it anyway. I hope they'll turn their focus back to console and arcade games now and focus on quality rather than quantity.


Well... I don't know about "horrible". To me Sonic 06 was horrible, and heroes was less bad than that. But yeah. Heroes was when it all began to unravel. After that I stopped buying Sonic games just because they were Sonic and waited for the review. When 06 came out it was so critically panned I didn't bother spending money on it.

That's the way it's pretty much been since, but when Generations started getting 8's I opted to buy it at full price to show my support. A concerted effort in my opinion should always be encouraged and the inverse is also true.
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Re: SEGA Financials are Horrible

Postby Hyo Razuki » Thu Aug 06, 2015 11:08 am

I haven't played 06 since I didn't have an Xbox or PS3 when it came out. But yeah, I think we agree on Heroes being not a good game. :)
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Re: SEGA Financials are Horrible

Postby Wude-Tang Clan » Thu Aug 06, 2015 11:14 am

Horrible is relative when talking about Sonic games. Because, really, they're all bad.
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Re: SEGA Financials are Horrible

Postby amiga1200 » Thu Aug 06, 2015 11:28 am

Sonikku wrote:Well... I don't know about "horrible". To me Sonic 06 was horrible, and heroes was less bad than that. But yeah. Heroes was when it all began to unravel. After that I stopped buying Sonic games just because they were Sonic and waited for the review. When 06 came out it was so critically panned I didn't bother spending money on it.

That's the way it's pretty much been since, but when Generations started getting 8's I opted to buy it at full price to show my support. A concerted effort in my opinion should always be encouraged and the inverse is also true.
:mrgreen: not alone!
i got three console versions, yet to actually finish the game...
wouldn't have got the ngc and ps2 versions if i didn't get into em. (there's a TONNE of sonic games i've yet to try, like colours for one...)
that said, the xbox and ngc versions do seem smoother. :P
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oh yeah, subject:
sega have a long way to go to make it right again.
hell DID seem to freeze over for some (s3 and ff7 rebuild) so there's a tiny chance....i'm not kidding anybody, least of all myself. :oops: :cry:
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