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Sega Sammy posts $108 million April-June loss

Publisher's gaming division revenues plummet 40%; Conduit racks up 150,000 in sales as Virtua Tennis serves up 790,000; PS2 support apparently discontinued.

Not even Sonic the Hedgehog can outrun the global economic crisis. Sega Sammy, the parent company of Sonic publisher, Sega, today posted its results for its first fiscal quarter, which ended June 30. Like many other publishers trying to navigate the current recession-marred market, the results were far worse than those of a year ago.

Unfortunately, High Voltage's game was not a cash conduit.

Unfortunately, High Voltage's game was not a cash conduit.

Sega Sammy's overall sales for the quarter dipped 19 percent year-over-year to ¥60.46 billion ($635.4 million) for a net loss of ¥10.29 billion ($108.1 million). The previous June quarter's net loss was a slightly worse at ¥10.53 billion ($110.6 million). The company's consumer business--which includes home game sales, toys, mobile phone content, and animated films--posted particularly poor numbers, with sales declining nearly 41 percent to ¥18.01 billion ($189.2 million) for a loss of ¥4.5 billion ($47.29 million).

In addition to games, Sega Sammy also produces pachinko machines and operates arcades and other amusement centers. The Pachinko and Pachislot division had revenues of ¥19.75 billion ($207.5 million) and posted a loss of ¥1.04 billion ($10.9 million)--an improvement on its ¥4.35 billion ($45.71 million) shortfall during the April-June 2008 quarter.

Despite the bad news, the company is optimistic about a turnaround. Even though it's expecting to rack up a net loss of ¥14.5 billion ($15.3 million) in the first half of its fiscal year (ending September 30), Sega Sammy is projecting to finish the year with ¥15 billion ($157.6 million) in net income.

As for Sega's gaming business, the reported contained a few items of note. The publisher appears to be done supporting the PlayStation 2, as it projected no releases on the platform for its entire current fiscal year, down from 10 the previous year. Support for the DS also looks to be scaled back somewhat, as Nintendo's handheld is slated to receive 21 Sega games this fiscal year, down from 30 the year prior. Projected support for all other platforms was within three games of last year's numbers.

Finally, Sega Sammy released some combined North American and European sales figures for its recent releases. High Voltage's Wii first-person shooter The Conduit sold 150,000 copies between the two continents, while Virtua Tennis 2009 racked up 790,000 sales across the PlayStation 3, Xbox 360, Wii, and PC. During its first month on sale in the US, The Conduit managed to sell 72,000 copies.

117 Comments

  • Jackal31598

    Posted Aug 14, 2009 11:59 pm GMT

    Good news! "...Sega considers The Conduit a success, given that it shipped 300,000 units worldwide, about 150,000 of which sold through to consumers." So, it's not a failure as some people have been incorrectly predicting.

    Also, "...Sega fully intends to continue releasing more mature games for the Wii, given that the platform's massive installed base allows even niche games to be successful." And that is great news for Wii owners, since we'll probably see more innovative games appearing in the future. Thank you Sega!

    Quotes are from the article: Sega Still Open to Core Wii Games, by Tom Magrino - GameSpot, posted Aug 13, 2009 3:04 pm PT, located at the URL http://www.gamespot.com/news/6215266.html.

  • Jackal31598

    Posted Aug 13, 2009 4:40 pm GMT

    :-( I really LIKE the Conduit and the effort they made to bring games with better graphics to the Wii with online play, Wii Speak support, and revolutionary control customization. I wish more people bought it so it could've been a huge success... Who gives a crap about Tennis when you can shoot up some alien scum!? Online play, yo! Get it and get online!

    However, I can't blame peeps for buying Wii Sports Resort cause it's a bargain bundle! That's why my wife and I bought Wii Play last year.

  • nynthninja

    Posted Aug 4, 2009 12:39 pm GMT

    Rottenwood agreed...in fact thes whole gen there have only been 2 VC and Condemned (1 not 2)

  • Rottenwood

    Posted Aug 4, 2009 10:30 am GMT

    I love Sega, but they haven't been a 'must-buy' publisher in a long time. Other than Valkyria Chronicles, I can't remember a great Sega game this generation. Sonic's quality control is in the toilet after some shoddy sequels and overuse of the brand. Monkey Ball has sucked since the GameCube, and many of Sega's best franchises lay dormant. They need a shake-up at the top tier.

  • The_Owner

    Posted Aug 4, 2009 7:10 am GMT

    I can't comment on the other series mentioned here, but Panzer Dragoon usually doesn't sell well if I remember right. Oh well, it was one of my favorite Xbox games.

  • kavadias1981

    Posted Aug 4, 2009 2:57 am GMT

    It's almost as if Sega is the only one that doesn't understand what people want to play. We are all constantly commenting on what we want and yet they don't listen! Release all 3 parts of Shining Force 3 on one disc. Take Sonic back to his roots. Panzer Dragoon, Streets of Rage, Shinobi, etc. We all want them, Sega knows this and yet they do nothing about it and then whine when sales are poor. Are they bloody stupid or ignorant... or both?

  • The_Owner

    Posted Aug 4, 2009 1:11 am GMT

    If Sega really wants to fix Sonic they need start all over again and make a game with JUST SONIC. Get rid of the platforming levels, get rid of all the unnecessary characters and their overly cutesy voices, and make levels with lots of running. Maybe they need to have some platforming, but only if it can be worked into high speed running sequences. Sonic is a fast character which means this series should be very arcade like in it's game play. I've had this picture in my mind of a demo of a game like this showing Sonic running through a desert.

  • Javieralijandro

    Posted Aug 3, 2009 7:53 pm GMT

    Sorry for the conduit not selling well, but when i saw the publisher i said ok, im not getting this sega hasnt made a game that ive not regret paying for since the 16-bit era

  • lamprey263

    Posted Aug 3, 2009 4:27 pm GMT

    just make a really good Panzer Dragoon game for the X360 and PS3, or an upscaled remake of the last one or the series for that matter, and even give the Wii a watered down version that'll still look good, and they could make a few bucks that; that's a least a lot more thoughtful than going "jeez, we're taking a beating on the market, how should we react?" - "hmm, [lightbulb] lets make even more Sonic games".

  • falconclan

    Posted Aug 3, 2009 2:52 pm GMT

    Sega needs to revive some older games and make them new again. Sonic and pals have been milked nearly to death, give them a few years off to refine the games instead of the same deal over and over. I must admit Unleashed was quite fun (for wii, not for the other consoles, I played both ) but sonic is going to die in the eyes of consumers if he doesn't take a day off.

    Anyways, some series they could revive. Streets of Rage - Maybe not a full game, maybe an arcade remix reshelled style. It would be beautiful and an INSTANT buy for me. I love this game.
    Vectorman - Long dead, but I think with a creative staff vectorman could be brought back into this generation of games.
    Afterburner - It certainly wouldn't be hard to make a flight sim, and seeing as the genre is lacking lately (with the most recent being hawx, which I heard was meh) and ace combat.
    Shinobi - his ps2 game was good, but I think they could really do something with Shinobi. Ninja Gaiden is good, but I think even that formula isn't for everyone, so they could be the alternative.

    I don't know, I keep hoping sega will make intelligent decisions. Albeit the last good decision they made was in 1998 with the dreamcast, and that bit them right in the ass, but thats what you get when you **** consumers.

  • Depresso

    Posted Aug 3, 2009 12:54 pm GMT

    Sega should make good games instead of rushing out crap !

  • jamestillett

    Posted Aug 3, 2009 11:35 am GMT

    Sega should port Afterburner climax which was highly rumored at one stage running on Lindbergh graphic engine like vt2009 vt3 & virtua fighter5 it was privately shown running on next gen hardware at the Tokyo games show in 2008 yet sega prefere to bring trashy games like stormrise Conduit Afterburner climax would rake in the same kind of sales that vt2009 did with online and trophies it would be perfect.Gamespot pass on all these comments to Sega and give them that AM2 call they need

  • Darkman2007

    Posted Aug 3, 2009 8:16 am GMT

    sega has released some good games, most noteworthy is the excellent Valkyria Chronicles but I think they are making a number of mistakes.

    the biggest one is ignoring some of their old franchises. yes there was the new sega rally game, and an average golden axe game, but we need more good games.

    a better sonic game, a good Panzer Dragoon game, a good nights game (the one on the Wii isnt as good as the original), crazy taxi would be good too...
    im not sure about everyone else, but I would rather have a new Panzer Dragoon game then a new ironman game.....

  • Mr_Versipellis

    Posted Aug 3, 2009 2:11 am GMT

    Wow, hardcore games DO NOT sell on Wii.

  • Antherian_being

    Posted Aug 3, 2009 1:21 am GMT

    I really like The Conduit, but it definately didnt live up to its anticipation... surprised by the superstars tennis sales but the wii makes more off party gamesthan more hardcore games bcoz xbox owns...

  • Bodboy466

    Posted Aug 2, 2009 9:30 pm GMT

    Dammit... Sega, must you fall so far? It pains me to see you battered so...

  • dragonfly110

    Posted Aug 2, 2009 8:47 pm GMT

    ouch it sure is a shame about the conduit flopping, although I did predict this, yet nobody believed me about it.

  • Trogeton

    Posted Aug 2, 2009 8:23 pm GMT

    I hated the dreamcast in a way.. the controller was oddly built and with the wire coming out of the bottom, and not many games, I think one of the best games was Sonic adventure 2 but it died fast, but GREAT graphics considering when it came out

  • Normaral85

    Posted Aug 2, 2009 8:08 pm GMT

    I don't miss the Dreamcast, it's in my basement. I miss seeing new games for the system, lol.

  • Normaral85

    Posted Aug 2, 2009 8:05 pm GMT

    They need to make another top notch system that won't break for another 30 yrs. So that other console makers can see what good console making really is. I have every Sega console and they all steal work and have never caused me a problem. I was done with Sonic after the first one and haven't touched one after the Gensis games. I haven't played any of the other games in this article but the game reviews and sales numbers don't lie. And don't tell me that they affected the sales cause anyone that really wanted a game would only be pushed to rent before buying. Then they'd make their own decision, which was not to buy

  • Humorguy_basic

    Posted Aug 2, 2009 5:48 pm GMT

    @ onlymetal75 When it comes to sales, which is what truly decides if a game is average, bad or good, Dead Space and Far Cry 2 did very poorly. Even the publishers said they weren't happy. Of course, one blamed piracy and the other that is was an original ISP. The fact is one only had a dozen hours gameplay for your $60 and the other had a great big open world and forgot to fill it with anything, leading to repetitive play. So sales wise,these titles were very 'average'.

  • Alexadecimal

    Posted Aug 2, 2009 3:33 pm GMT

    Who else misses the Dreamcast?

  • zakkess

    Posted Aug 2, 2009 2:59 pm GMT

    go back to console making and support it good with no screwups at launch or anything and theres ur money sega

  • hansolo14

    Posted Aug 2, 2009 12:03 pm GMT

    its all about recession

  • burghardt

    Posted Aug 2, 2009 10:27 am GMT

    man i love my megadrive still one of only very few consoles i have had for more than 2 years and aint broke its lasted 15 years now and still going strong god damn global economic crysis

  • Jhedan

    Posted Aug 2, 2009 10:00 am GMT

    They can go to hell for what they did with the Guilty Gear franchise.

  • onlymetal75

    Posted Aug 2, 2009 7:44 am GMT

    I wouldnt put far cry 2 and dead space in the average column.

  • Humorguy_basic

    Posted Aug 2, 2009 4:59 am GMT

    It's bleak for all major games companies. They have made their bed of bigger and more expensive game production every year with no improvement in quality, and now they are having to sleep in that bed. They can't go back to, say PS2 graphics, and they are so out of touch regarding what gamers want as to be ridiculous. The gaming media doesn't help either, refusing to have a debate on these issues. We have already seen the news that there may not be any more new consoles from Microsoft and Sony as the games for these new machines 'would be too expensive to produce'. We now have very average games (Dead Space, Far Cry 2, The Conduit, for example) costing $10's of millions to bring to market. The cost of bringing a game to market is now killing any genre that is less than 'mainstream' and forcing more and more games to be part every genre (little bit RPG, little bit fps, little bit adventure, little bit driving game), in order to sell to everybody, and then selling to nobody (Far Cry 2, Fuel, the future Alpha Protocol, etc).

    The major games companies are going to have to make major changes if they are to survive. One suggestion from me would be to take the accountants from the top of the company hierarchy and put the designers back on top. Like was the case 6+ years ago.

    The drive to downloading games is about eeking out more income from the same, mostly substandard, games, so this won;t work either. Costs must come down and quality must rise.

  • Taegre

    Posted Aug 2, 2009 2:34 am GMT

    I wonder if the outlook is really so bleak over in Sega's hometown Japan. Think about it, Sega's Dreamcast was taken off store shelves in the west in 2001, but in Japan developers supported it all the way to 2008. Maybe Sega's problem is that they haven't given the right kind of attention to the gaming audience outside of Japan. They could see a big turnaround if they released their locally-developed hits like the newest Yakuza game to western audiences, rather than leaving western games to western developers as they did with The Conduit.

  • Ovirew

    Posted Aug 2, 2009 12:00 am GMT

    SEGA has had a lot of problems gauging what their consumers want over the years, and while we might tell them the kind of game we want to see from the sidelines, it's really not as easy as that, and just because it's a game that seems popular now, doesn't mean that the entire gaming population will reflect those feelings. Just from coming here and hearing so much about the Conduit, and hearing how many people bought it on release day (regardless of how they felt after playing it), I'd of assumed it did a lot better than what it did. Apparently I was mistaken, so imagine how hard it is for group of people to keep track of what millions of us want.

  • frazzle00

    Posted Aug 1, 2009 11:41 pm GMT

    Sega have published good titles recently; it just seems no one really cares to pick them up. Sega Rally Evo, Condemned 2, Sonic's Sega Genesis Collection, Valkyria Chronicles, and Mad World to name a few. I guess people are too busy playing quality titles like Guitar Hero 4, Madden 09, and of course my personal *favorite* Wii Fit .

  • tbs76

    Posted Aug 1, 2009 7:45 pm GMT

    If Sega wants to return to its glory days I think they better get some top tier talent and start making quality games like they did with Saturn and more importantly the Dreamcast. They continually publish Sonic games that are very average at best, and spend alot of publishing dollars on crappy licensed games. First of all they should have never given up on there sports games as the 2K series has declined in quality ever since. They need to bring back old franchises with a new look and make sure they are top quality. Make a good Shinobi game, Afterburner, Space Harrier, Outrun, Golden Axe, Streets of Rage, Altered Beast and many more. Sonic for example should be a game carrying the organization but he has has so many ho hum games in the past few years the hog is just not relavant anymore. Sonic Adventure was the last decent one in my opinion. Give up on adding terrible side kicks....Sonic is better on his own. Ever since the AM divisions sorta split up things have been in shambles. I think if one company can turn the ship around its Sega, but stop gambling on games that are just not marketable. As good as MadWorld is its on the Wii and its just not marketable. If people dont get the concept, they dont buy it. Even crappy first person shooters are selling better cause FPS is still the hot thing in North America. Again, this company has alot of top tier properties that people like myself are missing. Lets go Sega.

  • Trogeton posted Aug 1, 2009 7:17 pm GMT (does not meet display criteria. sign in to show)

    Trogeton

    Posted Aug 1, 2009 7:17 pm GMT (hide)

    I hate the sega consoles but I love alot of the sega games.. Well sonic next time GO SUPER SONIC XD

  • ninja-legend

    Posted Aug 1, 2009 6:17 pm GMT

    I see a lot of you think Sega has released nothing but crap as of recent times. There has been Virtua Fighter 5, both Condemned 1+2, Virtua Tennis, Valkyaria Chronicles, Empire Total War, and Mad World. Lots 'O companies put out some crap. Even my favorites (Rockstar and Capcom). Why the hate? I really don't get it.

  • JERMINITIS

    Posted Aug 1, 2009 6:03 pm GMT

    I'm part of the minority because, I actually liked The Conduit. However, I was hesitant to pick up Madworld. Yet, I saw @ BestBuy today that Madworld was only $30. So, I may pick it up.

  • gam3r3OOO

    Posted Aug 1, 2009 5:59 pm GMT

    "Sega Sammy posts $108 million April-June..."
    Yeah I see what you did there...I got hooked.
    ...and the sinker (in losses)

  • Supreme4dmira1

    Posted Aug 1, 2009 5:40 pm GMT

    I've hated Sega ever since 'blast processing.'

    But its disappointing to see some of theirs falling. Although they don't make any games that I enjoy....

  • scarface_dm

    Posted Aug 1, 2009 5:24 pm GMT

    WTF, Now I really hate to see one of my favorite companies be in financial trouble. But I agree with the other posts and Sega has been releasing games that there fans just dont want, Whoever is running Sega should get canned because them corporate suits dont know what us gamers are really wanting!

  • Watcher77

    Posted Aug 1, 2009 4:38 pm GMT

    Good, I hope these ****ers go out of business. I have dealt with their poor customer support the last 2 years on Phantasy Star Universe, watching as their plain stupidity and ignorance to what the players wanted caused a multitude of players to leave the game completely The servers used to be full, but now the PC/PS2 version can barely hold a 1 star rating, which constitutes that 1000 people are playing.

  • -HCMF-

    Posted Aug 1, 2009 4:06 pm GMT

    wow, once know for quality games. Lately all I have sceen from Sega is sub par garbage. This is sad, I miss the days of inovation.

  • RawDeal_basic posted Aug 1, 2009 2:27 pm GMT (does not meet display criteria. sign in to show)

    RawDeal_basic

    Posted Aug 1, 2009 2:27 pm GMT (hide)

    Good, now maybe SEGA will go away for good.

  • Cobalt_Strike

    Posted Aug 1, 2009 2:23 pm GMT

    Agreed BtmnHatesRbn. Looking back I really wish Sega took MS' offer. All I'm saying is; Sega's creative staff (at the time) with MS' budget...they might be the same innovative company they use to be.

  • CVM_123

    Posted Aug 1, 2009 2:06 pm GMT

    conduit was crap just like the wii lol

  • ropumar

    Posted Aug 1, 2009 1:26 pm GMT

    Valkirya chronicles!
    VC 2 on psp. And VC3 on ps3, now sega.

  • BigBacon87

    Posted Aug 1, 2009 12:48 pm GMT

    I was going to say I can't even remember the last time I bought a good Sega game but that's not true.. I picked up Sonic's Ultimate Genesis Collection in the winter and it rocks. Obviously that doesn't speak very well for Sega when remakes are the best thing they are putting on the shelves.

  • vicsrealms

    Posted Aug 1, 2009 11:47 am GMT

    They need to turn Shining Force back into an SRPG so I am willing to purchase that series again. Or pull the Phantasy Star back into a traditional RPG as well. Thats two series Sega has screwed up over the years. In fact SF1, SF2, and Phantasy Star 1-4 are still some of my favorite games. In fact a couple of them are still being played on my Genesis, while the others game out in a game pack for the PS2 which has at least allow me to use my PS3 for something other then Blu-Ray movies.

  • kekejefferis

    Posted Aug 1, 2009 11:44 am GMT

    Seems about fair for a company that seems to do completely opposite of what it's fans would like.
    They have only released uter crap the past few years and they seem happy enough to let the Sonic franchise be butchered beyond belief and let franchises like Panzer Dragoon, Jet Set Radio, Shenmue, Daytona, Otogi and Virtua Cop just dissapear into oblivion.
    Sega-sammy needs a seriously good kick up the arse if they hope to make any profit. If they keep at the rate they are going the Sega name will only be a memory from your childhood.

  • jtthegame316

    Posted Aug 1, 2009 11:43 am GMT

    i have to get the conduit if it was on xbox i probably would of had it by now just i don't play the wii half as much as xbox. i hope sega bring a third shenmue to xbox also bring yakuza 3 to europe and prefurrably put it on to xbox 360 so i don't have to buy a ps 3 to play it. also some of there saturn classics like panzar dragoon saga, baku baku animal, gardian herose along with dreamcast classic jet set radio on xbox live arcade would be nice. i am looking forward to bayonetta that looks good. alpha protocal looks interesting and the svp game is looking good.

  • Zathic

    Posted Aug 1, 2009 10:59 am GMT

    @iamtheleg - You should check out Valkyria Chronicles

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