In the financial results of the Group for the fiscal year ended March 2024 (FY2024/3), sales increased significantly from the previous fiscal year due to strong sales in the Pachislot and Pachinko Machines Business and the Consumer area mainly in Japan and other Asian regions, as well as Rovio Entertainment Corporation’s new entry into the group. As a result, ordinary income also showed significant increases from the previous fiscal year, with net sales of 467.8 billion yen (389.6 billion yen in the same period last year) and ordinary income of 59.7 billion yen (49.4 billion yen in the same period last year).

On the other hand, extraordinary losses of approximately 19.2 billion yen were recorded due to the decision to implement structural reform in the Consumer area in response to the deteriorating business environment, particularly in the European studios. As a result, profit attributable to owners of parent decreased to 33.0 billion yen (45.9 billion yen in the same period last year), but we believe that this structural reform has paved the way for future improvements in profitability.

Next, with regard to the details of each business, the results for the Entertainment Contents Business showed an increase in sales and a decrease in profit compared to the previous fiscal year. While sales increased due to strong sales in the Consumer area, especially in Japan and Asia, and the Rovio Entertainment Corporation’s entry into the group, profit decreased mainly due to weak performance in the European Consumer Area and the implementation of structural reform to it.

With regard to the structural reform of the European Consumer area, we aim to strengthen the organizational structure of the European region, and are working on integrating the publishing functions in the Europe and the U.S.  to enhance them and improve efficiency. We are also conducting a review on the development and assessment processes to strengthen the development management function of the European studio.

With regard to the individual titles, Japan studios’ new titles “Like a Dragon: Infinite ” and “Persona 3 Reload” achieved  cumulative sales of 1 million units at the fastest pace in their respective franchises. In addition, titles such as “Football Manager 2024,” the latest in the popular franchise, and “Unicorn Overlord”, received high acclaim and sold well. Repeat sales and sales of existing F2P titles remained strong, contributing to the FY2024/3 results.

The Pachislot and Pachinko Machines Business recorded significant sales increases and profit due to strong sales of pachislot machines, including “Smart Pachislot Hokuto No Ken,” one of our mainstay titles. After the installation of “Smart Pachislot Hokuto No Ken,” repeat sales of the title progressed against the backdrop of high utilization levels, and sales of several other new titles also remained steady. As a result, the number of pachislot machines sold was approximately 180,000 units, a siginifant increase from the previous fiscal year. On the other hand, the number of pachinko machines sold decreased to approximately 88,000 units. This was due to the fact that the sales timing of some titles including mainstay ones were changed in FY2025/3 based on a revised sales schcedule. Sales of “Pachinko Hokuto No Ken  Bokyosei” and other titles released in FY2024/3 are generally going well.

In the Resort Business, we saw more-than-expected recovery of group customers at the Phoenix Seagaia Resort in Japan and achieved profitability for two consecutive fiscal years. The Paradise City in Incheon, South Korea, also performed well centering on Japanese VIP customers and contributed to the profitability of the business. The equity method acquisition amount for FY2024/3 was 0.9 billion yen.

As we launch our new medium-term plan “WELCOME TO THE NEXT LEVEL!” from FY2025/3, the Resort Business was abolished and the Gaming Business was newly established. As a result of this business restructuring, our three reportable segments have now become the Entertainment Contents Business, the Pachislot and Pachinko Machines Business, and the Gaming Business. This has been done based on the new Medium-term Plan stategy and the perspective of business portpolio enhancement. Overseas online gaming related business, operation of existing integrated resort facilities, development and manufacturing of casino equipment and others are integrated into the newly established Gaming Business.

In the new Medium-term Plan, we will enhance our business portfolio and clarifies the positioning of each business. In addition, we will continue to make a growth investment in the Consumer area and the Gaming Business. The source of funds for the growth investment will be the abundant cash flow generated by the Pachislot and Pachinko Machines Business and other businesses. In this way, we will enhance corporate value by investing the cash flow generated from the Pachislot and Pachinko Machines Business in the growing Consumer area as well as the Gaming Business as a new business pillar.

SEGA’ s Consumer Division of Entertainment Contents Businessto strengthen its transmedia strategies to continue building out the company’s extensive lineup of video game franchises further into the entertainment space through cinema, television, licensed products, and more.

Golden Axe, the hack and slash fantasy action game for arcades and consoles, has also been slated to turn into an animated series with production currently underway. More information to come soon – stay tuned!

The mobile title Persona 5 : The Phantom X has launched simplified Chinese, traditional Chinese, and Korean versions of the game via a licensing arrangement with Perfect World Co. Ltd. It was also announced that Persona5:The Phantom X is slated to release in Japan. Releases for other countries have yet to be declared. Stay tuned for more details!

Transmedia will continue to be an important part of our overall strategy moving forward as we work to grow our main IPs across not only video games, but movies, television, licensing, and merchandise.

The smart pachinko machines are the next-generation pachinko machines introduced in April 2023. Unlike the traditional pachinko machines, the balls enclosed in the machines circulate internally and there is no physical payout of balls. Therefore, they are expected to offer many benefits such as reducing the burden of pachinko halls to carry and clean balls, as well as contributing to electricity savings, eliminating the cheating, and improving the game play and game environment for users. Furthermore, as the payout information, etc. is managed by pachislot and pachinko machine information terminal operated by a manufacturers’ industry association, smart pachinko is expected to serve as a countermeasure against addiction. However, while smart pachislot machines have become settled in the market since the introduction in November 2022 due to several hit machines including “Smart Pachislot Hokuto no Ken,” not many hit smart pachinko machines have appeared and they have not yet reached fully-fledged diffusion.