Sega Sammy Holdings Stock Earnings Reports

Q1 results were broadly in line with company expectations: operating income losses were smaller than guided, though adjusted EBITDA was roughly as planned after a JPY2.9 billion foreign-exchange loss was recorded in non-operating items. Sega Sammy completed two strategic gaming acquisitions (Stakelogic BV and GAN Limited); these are consolidated on the balance sheet from Q1, but their P&L will be included from Q2 (their year-ends are in December). Provisional goodwill from the deals is substantial (~JPY18.6 billion for Stakelogic and ~JPY17.4 billion for GAN). Cash and deposits fell due to the acquisitions and treasury-stock activity; the company expects a negative overall cash flow of about JPY50.6 billion for the quarter. Entertainment contents: Persona5: The Phantom X launched June 26 and had a very strong start (see quote below), other consumer and F2P releases (Sonic Racing, Sonic Rumble, new Football Manager) are scheduled from Q2 onward, and animation (Detective Conan) performed well (box office > JPY14 billion). Pachislot/Pachinko: Tokyo Revengers launch has strong early demand (orders >25,000 units vs plan 20,000) and Lucky Trigger 3.0 Plus models showed high initial operation; however, pachislot certification/compliance rates remain low (~13–20%), a timing risk for some releases. Gaming: US video-slot sales and Paradise City casino contributed positively; integration and full-year P&L impact of Stakelogic and GAN remain under review. Key investor risks include foreign-exchange volatility, timing/certification uncertainty for pachislot/pachinko launches, launch timing and monetization of key game titles (including Rovio performance variability), and integration execution on the recent acquisitions.