SEGA SAMMY Holdings (6460): FY2025 Results Summary — Net Loss on Rovio and Stakelogic Impairments Despite Record-Level Sales

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Note: SEGA SAMMY Holdings labels the fiscal year ended March 31, 2026 as “FY2026/3” and the fiscal year ending March 31, 2027 as “FY2027/3”; the text and tables below keep the company’s own labels. In FY2026/3, the SEGA SAMMY Group posted sales of 487.5 billion yen (up from 428.9 billion yen in FY2025/3) and operating income of 47.1 billion yen (down from 48.1 billion yen). Ordinary income rose to 54.2 billion yen, but extraordinary losses of 58.8 billion yen — reflecting impairment losses on Rovio and Stakelogic — resulted in a loss attributable to owners of parent of 5.7 billion yen, against a profit of 45.0 billion yen a year earlier. Adjusted EBITDA, an indicator in the medium-term plan, fell to 16.6 billion yen from 62.2 billion yen and ROE was -1.6%. For FY2027/3 the company forecasts sales of 510.0 billion yen, operating income of 44.5 billion yen and profit attributable to owners of parent of 32.5 billion yen, with an annual dividend of 55 yen per share.

Consolidated Results (Full-Year Actual)

Sales increased and profits decreased compared with FY2025/3. In the Entertainment Contents Business, Full Game sales, new F2P titles and Rovio’s performance were soft in the Consumer area, while in the Pachislot & Pachinko Machines Business sales of mainstay pachislot titles were strong. In the Gaming Business, sales increased and the operating loss widened due to the consolidation of two acquired companies (GAN and Stakelogic). The company recorded a net loss due to the recognition of impairment losses on Rovio and Stakelogic: for Stakelogic, following a further review of the business plan, extraordinary losses were recorded in FY2026/3 including approx. 0.7 billion yen as an impairment loss associated with the downsizing of operations in the Netherlands and approx. 18.0 billion yen as a full impairment loss on goodwill, etc. For GAN, the purchase price allocation was completed, with goodwill of 14.5 billion yen, trademark rights of 0.9 billion yen, tech-related intangible assets of 2.6 billion yen and customer-related intangible assets of 0.9 billion yen recognized as of the end of FY2026/3. Adjusted EBITDA is defined by the company as ordinary income plus interest expenses and depreciation and amortization, plus or minus adjustment items.

Item (Billion Yen)	FY2025/3 Full-year Results	FY2026/3 Full-year Results
Sales	428.9	487.5
Operating Income	48.1	47.1
Ordinary Income	53.1	54.2
Extraordinary income	10.0	0.8
Extraordinary losses	8.3	58.8
Profit or loss attributable to owners of parent	45.0	-5.7
Adjusted EBITDA	62.2	16.6
ROE	12.2%	-1.6%

On the balance sheet, total assets stood at 627.3 billion yen as of the end of March 2026 (644.7 billion yen a year earlier). Cash and deposits decreased by 47.0 billion yen to 153.3 billion yen due to the acquisition of GAN and Stakelogic, the acquisition of treasury stocks, etc., and inventories rose by 17.3 billion yen to 110.9 billion yen as inventory assets associated with video game development increased. Intangible fixed assets decreased by 11.1 billion yen to 80.1 billion yen due to impairment of goodwill etc. on Rovio and Stakelogic, even as the consolidation of GAN and Stakelogic started. Shareholders’ equity decreased by 48.7 billion yen to 311.0 billion yen due to the recording of a loss attributable to owners of parent, the acquisition of treasury stocks and dividend payments, etc. Net cash declined to 11.7 billion yen from 49.3 billion yen, and the equity ratio was 56.5% (59.1% a year earlier). Cash flows from operating activities were +25.9 billion yen, cash flows from investing activities -22.5 billion yen (including purchase of shares of subsidiaries of -22.5 billion yen) and cash flows from financing activities -56.6 billion yen (including purchase of treasury stock of -32.0 billion yen and cash dividends paid of -11.5 billion yen).

Segment Results

Entertainment Contents Business: sales increased to 326.6 billion yen while operating income decreased to 32.4 billion yen. Full Game and some new F2P titles, and Rovio’s performance, were soft in the Consumer area, while existing F2P titles, subscription services and DLC (all Consumer) and the Animation area performed steadily, and licensing revenue grew steadily throughout the fiscal year. Full Game sales were 67.2 billion yen (new titles 29.8 billion yen, repeat sales 37.4 billion yen) on unit sales of 22,950 thousand, and F2P sales were 53.7 billion yen. Segment adjusted EBITDA fell to 13.3 billion yen from 48.1 billion yen.

Pachislot & Pachinko Machines Business: sales rose to 132.0 billion yen and operating income to 32.1 billion yen, with strong sales of mainstay titles and new IP titles, particularly in pachislot. Main titles sold included Smart Pachislot Tokyo Revengers, Smart Pachislot Hokuto No Ken Chapter of Resurrection 2 and Smart Pachislot Kabaneri of the Iron Fortress: The Battle of Unato. Pachislot unit sales were 135,702 units across 5 titles (86,641 units across 8 titles in FY2025/3) and pachinko unit sales were 97,728 units across 5 titles (99,889 units across 8 titles). Gaming Business: sales increased to 25.3 billion yen as GAN (14.5 billion yen) and Stakelogic (2.2 billion yen) were consolidated for nine months, but an operating loss of 7.2 billion yen was recorded, with losses at GAN (-2.7 billion yen) and Stakelogic (-1.5 billion yen) and goodwill amortization of -3.3 billion yen. In existing businesses, sales and profits increased: gaming machine sales saw strong sales of video slot machines in the mainstay series, and PARADISE SEGASAMMY recorded the highest amount in equity-method earnings (4.5 billion yen, up from 3.2 billion yen).

Segment (Billion Yen)	Metric	FY2025/3 Results	FY2026/3 Results	FY2027/3 Forecast
Entertainment Contents	Sales	321.5	326.6	357.0
Entertainment Contents	Operating Income	40.8	32.4	42.5
Entertainment Contents	Adjusted EBITDA	48.1	13.3	52.5
Pachislot & Pachinko Machines	Sales	97.1	132.0	115.5
Pachislot & Pachinko Machines	Operating Income	20.0	32.1	24.0
Pachislot & Pachinko Machines	Adjusted EBITDA	24.2	33.7	27.5
Gaming	Sales	5.4	25.3	34.5
Gaming	Operating Income	-0.7	-7.2	-10.0
Gaming	Adjusted EBITDA	1.0	-18.4	-4.0
Other / Elimination	Sales	4.9	3.6	3.0
Other / Elimination	Operating Income	-12.0	-10.2	-12.0
Other / Elimination	Adjusted EBITDA	-11.1	-12.0	-12.0
Consolidated	Sales	428.9	487.5	510.0
Consolidated	Operating Income	48.1	47.1	44.5
Consolidated	Adjusted EBITDA	62.2	16.6	64.0

FY2027/3 Forecast

For FY2027/3 the company plans for an increase in sales and a decrease in profits compared with FY2026/3: sales of 510.0 billion yen, operating income of 44.5 billion yen, ordinary income of 47.5 billion yen and profit attributable to owners of parent of 32.5 billion yen, with adjusted EBITDA of 64.0 billion yen and ROE of 8.9%. In the Entertainment Contents Business, sales of new titles are expected to increase in Full Game with the launch of four new Full Game titles based on mainstay IPs, F2P titles launched in FY2026/3 are expected to contribute throughout the full year, and licensing revenue is expected to grow; Full Game sales are forecast at 95.3 billion yen (new titles 55.6 billion yen). In the Pachislot & Pachinko Machines Business, profits are expected to decline due to a decrease in mainstay titles and rising costs, etc., with pachislot unit sales of 139,000 units across 10 titles and pachinko unit sales of 84,000 units across 5 titles. In the Gaming Business, the loss is expected to widen to 10.0 billion yen at the operating level due to upfront investments aimed at establishing a foundation for future growth; the company describes FY2027/3 as the bottom of the J-curve and aims to achieve profitability at the ordinary income stage in its next medium-term plan. The GAN and Stakelogic P/Ls will be consolidated for the full 12 months (9 months in FY2026/3).

Item (Billion Yen)	FY2027/3 Forecast	FY2026/3 Results
Sales	510.0	487.5
Operating Income	44.5	47.1
Ordinary Income	47.5	54.2
Extraordinary income	0.0	0.8
Extraordinary losses	1.0	58.8
Profit or loss attributable to owners of parent	32.5	-5.7
Adjusted EBITDA	64.0	16.6
ROE	8.9%	-1.6%

The company also reviewed its medium-term plan. The current plan called for three-year cumulative adjusted EBITDA of over 230.0 billion yen and a three-year average ROE of over 10% for FY2025/3–FY2027/3; projected results are now three-year cumulative adjusted EBITDA of over 142.5 billion yen and three-year average ROE of over 6.5% (FY2025/3: 12.2%, FY2026/3: -1.6%, FY2027/3: 8.9%). By segment, the three-year cumulative adjusted EBITDA forecast is 107.3 billion yen for Entertainment Contents (plan: over 180.0 billion yen), 85.9 billion yen for Pachislot & Pachinko Machines (plan: over 90.0 billion yen) and -21.9 billion yen for Gaming (plan: positive; the impact of the GAN and Stakelogic acquisitions was not included in the plan).

Shareholder Returns

Shareholder return amounts for FY2026/3 totaled 31.45 billion yen, comprising dividends per share of 27 yen interim and 28 yen year-end and share buybacks conducted from February 16, 2026 to March 23, 2026, including 19.99 billion yen in acquisition of treasury stocks associated with a review of the strategic investment framework. DOE was 3.1%; the total return ratio is not shown due to the net loss for the fiscal year. For FY2027/3, since the initial dividend forecast is provisionally calculated based on a DOE of 3%, the annual dividend forecast is 55 yen per share (27 yen interim and 28 yen year-end), which is expected to result in shareholder return amounts of approx. 11.2 billion yen, with a DOE of 3.0% or more and a total return ratio of 50% or more. The company notes that the actual amount and method of shareholder returns may change depending on the progress of business performance and other factors. In its capital allocation review announced on February 13, 2026, the company decided to suspend large-scale M&A, implement share buybacks and review the strategic investment framework.

Item	FY2025/3	FY2026/3	FY2027/3 (Forecast)
Shareholder return amounts (Billion Yen)	23.20	31.45	Approx. 11.2
Dividends per share — Interim (Yen)	25	27	27
Dividends per share — Year-end (Yen)	27	28	28
DOE	3.0%	3.1%	3.0% or more
Total return ratio	51.5%	–	50% or more

Initiatives for FY2027/3

In the Entertainment Contents Business, the company reviewed the strategic positioning of GaaS (F2P): new F2P titles struggled in FY2026/3, with weak performance of Sonic Rumble Party, the company did not achieve the creation of economic value through collaboration with Rovio, and some launches were delayed. The company decided to cancel Super Game (with no additional costs associated with the cancellation), lowered the priority of F2P, and has already transferred over 100 F2P development personnel to the Full Game development team focusing on mainstay IPs. Rovio will continue efforts toward a global GaaS but will focus on its own rebuilding first, with the Angry Birds Movie 3 scheduled for December 23, 2026. Over 80% of the balance of content production expenses on the balance sheet (Consumer area, as of the end of FY2026/3) is attributable to titles scheduled for launch in FY2027/3–FY2028/3, and the company plans four new Full Game titles in FY2027/3, including STRANGER THAN HEAVEN from Ryu Ga Gotoku Studio. Licensing-out and related businesses continue to grow, centered on the Sonic IP. In the Pachislot & Pachinko Machines Business, the Group climbed to second place in total utilization share as of the end of March 2026 and aims to become No. 1; it started a full-scale rollout of reel unit sales from FY2027/3, expected to account for around 20% of planned pachislot unit sales. In the Gaming Business, gaming machine unit sales reached 1,576 units in FY2026/3 led by the North American market, Stakelogic will implement structural reforms including downsizing of operations in the Netherlands, and GAN will advance migration to its next-generation “V2” tech stack, while the Group establishes a foundation for providing B2B solutions in the U.S. The company also notes that the Middle East situation has had no significant impact on manufacturing and sales at this time, though supply chain disruptions may lead to rising prices and procurement difficulties for raw materials and parts.

This article is an analysis based on publicly available information and is not a recommendation to buy or sell any specific securities. Investment decisions are your own responsibility.