Demand for pachinko slot machines continues to fall

12 February 2019

According to the Sega Sammy consolidated financial report for the 3rd quarter, the company finds a decrease in profits by 6.8% in 2018.

The figures show that the company suffered losses in the field of online games at $24.5 million, despite the fact that the segment as a whole earned $267.2 million. The drop in profits by 20% from sales in the segment of pachislots and pachinko also causes concern.

The company plans to intensify its efforts to introduce a full range of products that comply with the new rules, as well as to reduce costs in order to increase profits in this segment.

Pachinko Hall

Demand for pachinko has recently fallen mainly due to the availability of other gaming options. Since the company is aware of this, it is trying to reorient itself to the land-based casino segment, establishing partnerships. Thus, a cooperation agreement was signed with the South Korean company Paradise City, and a marketing company was launched in Japan on the eve of the licensing of casino resorts.

The company also revised the optimistic forecast of income from the sale of Pachinko in the amount of 122 billion yen ($1.1 billion) and reduced it to 102 billion yen ($929.4 million).

Sega Sammy recently released two online games: Ryu ga Gotoku Online and Idola Phantasy Star Saga. It was originally planned that this year there will be 12 new products from the company, but then the number of games was reduced to nine.

However, not everything is so bad. Sales of the Football Manager 2019 and Judgment remain stable. In general, the income from the entertainment business amounted to $1.51 billion, of which $664.7 million came from digital and physical games. Nevertheless, the company's operating profit fell to $108 million, which is 53.5% lower than last year.

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