Sega Sammy Holdings has reported a decline in revenue for the nine months ended December 31, 2024, citing a downturn in its Pachislot and Pachinko Machines segment.
However, strong performances in its Entertainment Contents and Gaming businesses provided a boost in profits to the Japanese group.
The company posted net sales of JPY322.3 billion ($2.3 billion) for the period, an 8.1 percent decrease compared to JPY350.6 billion ($2.5 billion) in the same period last year. Operating income fell by 20.8 percent to JPY43.7 billion ($314 million), while ordinary income declined 13.9 percent to JPY49.4 billion ($354 million).
Despite these declines, profit attributable to owners of the parent rose by 17.3 percent year-on-year to JPY41.8 billion ($300 million), up from JPY35.6 billion ($258 million) in 2023.
The decline in overall revenue was largely attributed to a steep drop in the Pachislot and Pachinko Machines segment. Sales plummeted 35.6 percent to JPY76.5 billion ($550 million), and ordinary income fell 57.2 percent to JPY19.8 billion ($142 million).
The drop was primarily due to an exceptionally strong prior-year performance driven by Smart Pachislot Hokuto No Ken. However, the latest release, e Hokuto No Ken 10, performed steadily, and new titles such as Pachislot Kaidoumokushiroku Kaiji Kyouen are expected to support future growth.
Gaming Business Expands Rapidly
The newly established Gaming Business segment recorded a 208.1 percent increase in sales to JPY3.1 billion ($22 million). Ordinary income turned positive at JPY954 million ($7 million), reflecting strong sales of new gaming equipment, particularly Railroad Riches™ on the Genesis Atmos® platform.
The Paradise City integrated resort in South Korea also contributed to profits, with record-high casino revenue from Japanese VIP customers.
Looking ahead, Sega Sammy revised its full-year forecast, now expecting net sales of JPY425 billion ($3.1 billion), down 9.4 percent from the previous year. Operating income is projected to drop 20.5 percent to JPY46 billion ($330 million), while ordinary income is set to decline 13.8 percent to JPY51.5 billion ($370 million). Profit attributable to owners of the parent is anticipated to rise 13.4 percent to JPY37.5 billion ($270 million).
The company is also focusing on expanding its Gaming Business through acquisitions. The planned purchases of GAN Limited and Stakelogic B.V. are expected to establish a stronger foothold in the iGaming market, particularly in the United States.
Despite challenges in its Pachislot and Pachinko Machines business, Sega Sammy stated it remains optimistic, citing its robust Entertainment Contents division and strategic investments in gaming as key drivers for future growth.
Entertainment Contents Soars
The Entertainment Contents segment saw net sales climb 8.2 percent to JPY239.1 billion ($1.7 billion), with ordinary income surging 88.7 percent to JPY37.6 billion ($270 million).
The growth was fueled by the success of major game releases such as Metaphor: ReFantazio, which won multiple awards at The Game Awards 2024, and Sonic X Shadow Generations, which surpassed two million units in global sales by January 2025. The company also highlighted strong contributions from Persona 5 Royal (Remaster) and Unicorn Overlord.
SEGA’s animation division also thrived, with Sonic the Hedgehog 3 grossing $460 million globally, prompting plans for a fourth installment in 2027. The company’s transmedia strategy—integrating video games, films, and merchandise—is expected to drive further growth in this segment.
