Electronics game machine maker Sega Enterprises Ltd. said Wednesday that it will suffer net losses of 32.8 billion yen for fiscal 1998, a sharp deviation from a projected 4.6 billion yen net profit.
As a result, Sega will slash its 4,000-strong workforce to about 3,000 "as soon as possible," through earlier retirement packages and personnel transfers to group companies, Sega officials said.
Sega cited worse-than-expected sales of its Dreamcast home video-game console, released to do battle against Sony's PlayStation.
About 900,000 units and 3 million software titles have been sold so far, against projected unit sales of 1 million and software sales of 5 million.
Sega lowered its total sales estimate from 245 billion yen to 214.5 billion yen, and sharply downgraded its pretax profit expectations from 12 billion yen to 400 million yen. The company also expects to take a hit in its arcade business at home and abroad and close major amusement facilities in the U.K. and Australia. The shutdowns will be posted as special losses of 10 billion yen for that purpose, they said.
At home, Sega will pare its 800 amusement facilities to about 700, selling smaller ones with poor sales performance by the end of fiscal 1999, according to firm officials.
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