Sega's Focus on Mobile Reduces Sales, But Raises Profits

Persona 5, Total War: Warhammer highlighted as key upcoming titles.

38 Comments

Sega has detailed its financial results for the 12-month period spanning April 1, 2015 to March 31, 2016. With fewer video games being released, sales showed a decline. However, its focus on mobile games and Pachislot have helped improve profits over the same period in the previous year.

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The Tokyo-headquartered company listed sales at $3.1 billion, which is a five percent drop over 2015's $3.3 billion. Profits, meanwhile, showed a slight upturn by rising to $161 million, an increase of 0.7 percent.

In its statement, Phantasy Star Online 2, which launched in 2012 for PC, was described as having "robust" sales. Chain Chronicle, Puyopuyo!! Quest, and Hortensia Saga were also highlighted as key titles.

Sales of packaged games were "lower than the level in the previous fiscal year, despite the launch of Football Manager 2016."

Sega noted noted a slowdown in the spread of smartphone games in Japan. Popular mobile titles continue to dominate, which means the performance of medium to lower tier titles is in decline.

Looking ahead, Sega intends to give mobile title longer development time and spend spend more money on them, so that it can compete with the more popular titles.

In terms of video games, it is aiming to improve profitability by launching Phantasy Star Online 2 for PS4, along with launching Persona 5 for PS4 and PS3, Yakuza 6 on PS4, and Total War: Warhammer on PC.

For more on the health of other video game companies, check out summaries of recent reports below.

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deactivated-5b69bebd1b0b6

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Looks like mobile gaming is slowly drying out (Hopefully). An when that happens hopefully they will go back to making games on platforms that people want.

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lvsolja

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run by idiots

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Barighm

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Yep, that's pretty much the end of Sega. Hopefully Atlus is allowed to to continue as normal.

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Thanatos2k

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Edited By Thanatos2k

Yeah Sega, become a garbage company like Konami.

I cannot wait for the mobile bubble to burst. Hopefully some government will recognize it's basically gambling and enact a law that destroys the F2P ecosystem.

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Ixilion

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Edited By Ixilion

I don't really mind them making mobile games, as I understand they want to make some quick buck but please continue to make quality PC & console games and don't turn your beloved franchises into mobile only.

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Exceed20XX

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Edited By Exceed20XX

And meanwhile I still have the Saturn and Dreamcast in constant rotation, not their mobile games. They really used to be great back then and to be fair a bit of that Sega magic still exists, just not so much on mobile. Valkyria Chronicles, Binary Domain, and Yakuza are testament to what Sega is capable of when they try.

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PlaystationZone

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Segway done this to save company and ya moblie gameing sucks so controls.

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Moonco

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Moonco  Moderator

I miss 90's Sega so much :-(

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PETERAKO

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I find it hard to believe that anyone who knows of and has any form of connection to dedicated gaming culture will switch to mobile because their favourite company/game franchise swifted there. Im not sure anyone in their right mind would dedicate to mobile. Im also annoyed that some middle aged man who creeps on boothbabes on E3 and who doesnt amount to anything more than a two-bit paper pusher thinks I will be a loyal little bitch and go to mobile.

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ghost140

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@PETERAKO: Its happening and it cannot be stopped. I know you can make stats say just about anything you want but the numbers are out there and continue to grow every year.

http://www.gamasutra.com/view/news/269618/The_average_US_paying_mobile_game_player_spent_87_on_F2P_IAP_last_year.php

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PETERAKO

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Edited By PETERAKO

@ghost140: I think thats for the regular clueless mobile user who couldn't give two shits about gaming, who if bored can tople a game company overnight. Zynga was in that position once, so was king and rovio. From personal experience all the people I know who played these kinds of games, have now gave them up. They have no idea who king, zynga or rovio is and they care not about any other games they made. How long will game of war keep it up?

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ethanm1834

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@PETERAKO: Yes but thats anecdotal evidence. People you know doesn't apply to everyone. Now I do agree with the Zynga comment. Zynga did in fact make quite a bit of money, but thats a casual market and its a fickle thing. I don't think its a "bad thing" to spend some resources while its hot. Just they need to read the signs of when things cool off. I think however that mobile will be a thing for quite some time.

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lrdfancypants

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Their alien game was one of my favorite this generation so far.

Apparently I was the only one that liked it :(.

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deactivated-5c56012aaa167

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@lrdfancypants: No you aren't. despite Alien Isolation tortured me in some parts(I Played in Hard and I don't dare playing the Harder Difficulty anytime soon) It was a great Game.

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Dark_Mits

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@lrdfancypants: It wasn't theirs; Sega just published (ie. paid for the advertising and the wages, but also took the biggest chunk of the earnings). Last game that Sega developed internally and was received with celebration was Valkyria Chronicles in 2008.

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Domiddian

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Edited By Domiddian

@lrdfancypants: Nah you weren't. It was a decent game for what it was. I enjoyed it.

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sladakrobot

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Phantasy Star 2 Online?
Call me interested.
That could be the 2nd game for the PS4 after Nier 2 i would buy...if it gets a western release that is.

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lrdfancypants

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@sladakrobot:

I thought it was already released in Japan?

I don't know the game but I remember seeing people excited about it.

If it's popular they should do a western release.

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sladakrobot

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Edited By sladakrobot

@lrdfancypants: It is but i never cared to play it on a pc.
I havent played any PSOnline game since the bad PS Universe.
Still playing PSO I+II from time to time on my Game Cube.
I hope PSO 2 is as fun or comes close to it.

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lrdfancypants

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@sladakrobot:

If it's on PC they should port it west to both Xbox and ps4 and try and make it shared worlds so the population stays strong.

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sladakrobot

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@lrdfancypants: There was talk of a Vita version which i was interested since i own a Vita...it seems that is scrapped.
If the cross play idea with Rocket League gets real and a success,maybe there is a chance.

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Exceed20XX

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Edited By Exceed20XX

@sladakrobot: The Vita version was never scrapped, it was released in Japan in 2013.

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sladakrobot

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@Exceed20XX: Sorry,i forgot to say i mean the western version.
In meanwhile,in Japan there is already PSO 2 Episode 4

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Exceed20XX

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@sladakrobot: Yeah they long ditched us on that front, even more if you wanted an English Vita version I hate to say. Either you sneak in or you do nothing at this point it seems.

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sladakrobot

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@Exceed20XX: My hopes lies in Sega localizing the PS4 version at least

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rickjamesia

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Edited By rickjamesia

@sladakrobot: I doubt it will ever happen. It seems like it's been forever since I grew bored of playing the PC Japanese version. (Thinking about it, I guess it's been about 3 years) It's frustrating when we get left by the wayside by big Japanese publishers only for them to complain that western gamers aren't buying their games.

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Silverline62

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Mobile is the future. And the future sucks.

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Alurit

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Edited By Alurit

@Silverline62: companies try to get into mobile and facebook games and even heavily invest in it but they won't go to full mobile because it is very risky. it's a winners take all market, you either make $5million a day or operate at a loss, and it's not forgiving. zynga became a multi billion dollar company in a heartbeat but now worth less then the building they are in

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PETERAKO

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@Silverline62: They said the same for F2P games but so far games that were big cantidates for F2P are now full price(law breakers, overwatch, battleborne etc). The mobile market is unstable. Mobile users dont care about games. They jump on a trend, they get bored, and then a company that made a huge profit off of a mobile game suddely finds itself with massive loss. The mobile scene already shows signs of stagnation and fatique and there are less instances of games growing to massive success.

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Silverline62

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@PETERAKO:

I hope so, fatigue is great in this case, the less people buy into this f2p market the better.

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deactivated-58183aaaa31d8

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Yeah when a game only costs £100 to make it doesn't take many sales to make profit.

You should stick to mobile Sega. You suck at proper games. We won't miss you.

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Domiddian

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Edited By Domiddian

@dexda: They never used to suck. There was a time when they were right up there with Nintendo. But now they are but a shadow of their former self.

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deactivated-58183aaaa31d8

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@domiddian: Yeah it is a shame. They made one of the best consoles ever and couldn't make it stick.

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Dark_Mits

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@dexda: Sega actually did a marvelous job with Dreamcast. It was the gamerbase that didn't have faith in them, and who were also at the same time enticed by the specs of Playstation2. At its first 2 years the Dreamcast was chock full with high quality games of almost every popular genre back then.

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Aero_Slasher

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@Dark_Mits: The failures of the CD, 32X, and Saturn globally ensured that unless the Dreamcast was the greatest selling console of all time, Sega was still boned.

The PlayStation 2 being branded as a then-world's most affordable DVD player did not help Sega as well.

Real shame. Dreamcast felt like the perfect console balance of that era.

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Gomtor

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@dexda: The problem is; others will follow. The market always follows profits.

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deactivated-58183aaaa31d8

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@Gomtor: Yep but traditional gaming still creates a nice profit overall. As long as companies CAN make money on larger console/PC games there will always be someone who does.

It might be smaller indie studios that continue to live after the AAA publishers move over but that is fine. I already play more Indie games than I do AAA.

I will never play games on mobile though. I will stop playing games all together before that happens.

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PETERAKO

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@Gomtor: This kind of problem is more akin to a one night stand that leaves you with a terminal STD than something long term.

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