Japanese conglomerate Sega Sammy Holdings has booked a full impairment on the goodwill tied to its acquisition of Netherlands-based iGaming supplier Stakelogic, less than a year after the deal closed, contributing to a group net loss for the fiscal year ended March 31st, 2026.
The company recognized approximately JPY18 billion ($114 million) in extraordinary losses against Stakelogic goodwill, alongside a further JPY0.7 billion ($4.4 million) impairment linked to the planned downsizing of the supplier’s Netherlands operations. The combined write-off effectively erased the goodwill value Sega Sammy had attributed to the €125 million ($146 million) acquisition, which closed in April 2025.
Sega Sammy attributed the impairment primarily to ‘market contraction in the Netherlands following regulatory tightening.’ The Dutch online gambling market has been under pressure since the introduction of mandatory deposit limits and other player-protection measures.
The Stakelogic write-down, together with a JPY32 billion ($203 million) impairment on Finnish mobile game developer Rovio Entertainment, pushed Sega Sammy to a group net loss of JPY5.7 billion ($36.1 million), compared with a net profit of JPY45 billion ($285 million) a year earlier.
Consolidated net sales rose 13.7 percent year-over-year to JPY487.5 billion ($3.09 billion), while operating income edged down 2.1 percent to JPY47.1 billion ($298 million). Adjusted EBITDA fell sharply to JPY16.6 billion ($105 million) from JPY62.2 billion ($394 million).
Within the gaming segment, the operating loss widened to JPY7.2 billion ($45.6 million) from JPY0.7 billion ($4.4 million) a year earlier, reflecting the consolidation of Stakelogic and U.S.-based GAN Ltd.. Segment sales nonetheless climbed to JPY25.3 billion ($160 million) from JPY5.4 billion ($34.2 million). The company expects the gaming operating loss to widen further to JPY10 billion ($63.3 million) in the fiscal year ending March 2027, due to upfront investments to build a B2B solutions platform in the United States.
In response to the impairments, Sega Sammy announced a significant strategic shift. The company said it has decided to ‘suspend large-scale M&A activities for the time being’ and revised its capital allocation policy, reallocating approximately JPY20 billion ($127 million) previously earmarked for strategic investments into a share buyback program executed between February and March 2026.
The medium-term plan targets have also been substantially lowered. The three-year cumulative adjusted EBITDA goal for fiscal years 2025 through 2027 has been cut from ‘over JPY230 billion’ ($1.46 billion) to JPY142.5 billion ($903 million), while the average return-on-equity target has been reduced from ‘over 10 percent’ to ‘over 6.5 percent.’
For Stakelogic, Sega Sammy outlined a restructuring plan for the fiscal year ending March 2027 that includes downsizing Netherlands operations, streamlining its development pipeline, and shifting focus toward porting Sega Sammy Creation Inc. titles online for expansion into the U.S. social casino market. The company described the approach as a ‘shift from quantity to quality.’
Paradise City delivers record year
In contrast to the troubled iGaming acquisitions, Sega Sammy’s equity-method affiliate Paradise Sega Sammy, operator of the Paradise City integrated resort near Incheon International Airport in South Korea, posted record-high results for calendar 2025.
Paradise City’s total sales rose to KRW597.4 billion ($400.2 million) from KRW539.3 billion ($361.2 million) the previous year, with casino revenue climbing to KRW480 billion ($322.0 million), driven by both Japanese VIP and mass-market customers. The number of casino visitors increased to 434,000 from 363,000. Hotel sales also reached an all-time high, supported by strong occupancy and average daily rates.
Sega Sammy’s equity-method earnings from the affiliate rose to JPY4.5 billion ($28.5 million) from JPY3.2 billion ($20.3 million), boosted by operating performance as well as the recognition of deferred tax assets and tax refunds. The company has also acquired an adjacent hotel building, which is scheduled to open as the Hyatt Regency Incheon Paradise City and is expected to expand the resort’s customer base.
