Sega Sells Arcade Business In Japan Due To Financial Losses Caused By Covid-19

Sega Sells Arcade Business In Japan Due To Financial Losses Caused By Covid-19

Sega Sammy Holdings, Inc has announced that it sold the majority of its Japanese amusement business to Genda. In a press release, Sega stated that the loss was caused by the impact of COVID-19.

Japan has arcades with the giant Sega logo located on the streets around the company. The arcades usually contain multi-story buildings with crane games on one floor, arcade machines on another, pachinko on the next, and more. With COVID-19 causing players to stay at home and international visitors unable to travel to the country, the arcade business has taken a big hit.

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Sega has decided to sell their arcade business but won’t be leaving arcades. The Sega arcade centers will retain their names and the giant logos on the side of the buildings. Patrons can continue to visit the arcades with COVID-19 precautions in place, which is good news as more residents venture out of their homes.

Unfortunately, this is only the latest unfortunate news for Sega. In August 2020, Sega closed its Akihabara Building 2, which was one of the most well-known arcades in the area, due to COVID-19.

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The press release, which was also released in English contains full details regarding the transfer of shares and further describing the situation.

As Amusement Center Operations area in Entertainment Contents Business is strongly affected by COVID-19, utilization of facilities has declined remarkably, and a significant loss was recorded at 1Q of the fiscal year ending March 2021. In addition, despite the recent recovery trend, the situation remains uncertain.

Some may wonder who exactly Genda is. The company is an amusement machine business. Genda will take over Sega Entertainment’s game arcades in Japan, which is around 200.

Sega Sammy is making the sale on December 30, but the amount remains a secret. According to the press release, Sega states they have lost around 20 billion yen, or $23 billion, for the current fiscal year that ends in March 2021.

Visitors planning on heading to one of these iconic arcades won’t have to worry about them being shut down. Players should still be able to access some of their favorite titles within these arcades, but staff will be taking extra precautions to clean up after guests.

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This sale will only impact Sega’s arcade business and not any video game development or other activities.