Once upon a time, Sega was one of the biggest companies in all of gaming, running a console arms race against Nintendo with the likes of the Sega Genesis and Dreamcast. But after failures and as the years went on and PlayStation and Xbox entered the scene the tides shifted. However, in recent years, Sega has gone through another massive boom, led by innovative games that have pushed the medium forward. Sega’s cadence of releases has been extreme lately, releasing more than seven full titles in the past business year alone. Now it looks like Sega is doubling down on that tactic, reinvesting in the studios that have provided its biggest recent hits.
In Sega’s latest financial report, an accompanying Q&A with investors digs into a bit of the company’s strategy moving forward. There are a few interesting tidbits, especially applying to the number of games we could see across the next year, and how those key studios are operating.
The last 12 months have seen a cavalcade of releases from Sega, including Sonic X Shadow Generations, Persona 3 Reload, Metaphor: ReFantazio. But what’s most astounding has been the output by Yakuza studio Ryu Ga Gotoku games. Since January 2024, RGG Studio has released Like a Dragon: Infinite Wealth, Super Monkey Ball Banana Rumble, Yakuza Kiwami on Switch, and Like a Dragon: Pirate Yakuza in Hawaii.
Pirate Yakuza is the fourth new game in the series in just two years.
It’s hard to see RGG and Sega itself keeping that output up, and unsurprisingly that seems to be the case.
“The plan is currently being formulated, but we expect the volume of new titles in Full Game to be lower than this fiscal year,” says Sega about its upcoming period, “On the other hand, we expect continuous revenue contribution from repeat sales of new titles in Full Game this fiscal year and full-scale revenue contribution from new titles in F2P.”
While the number might be lowering, what’s even more interesting is that these key studios seem to be a vital focus for the company moving forward, and something Sega will invest in — contrary to what a lot of other companies across video games are doing lately. When asked if Sega has considered acquiring external studios to bolster development, the answer was a fairly resounding no.
“Atlus is an important studio for us to expand Japanese IPs overseas and we think it is necessary to strengthen it, and the studios involved in the Sonic and Like a Dragon IPs are also short of staff, and we are looking to reinforce personnel through additional hiring and M&A,” says Sega.
Acquisitions have been a major topic in gaming in recent years, from Microsoft snapping up the likes of Bethesda and Activision Blizzard, to Sony investing in FromSofware owner Kadokawa, to NetEase and Tencent forming new studios from talented creators — even including Yakuza creator Toshihiro Nagoshi.
Sega’s studios have also flown in the face of big-budget games that take increasingly more years to make. While other companies double down on these costly experiences that aim to redefine everything, studios like RGG and Atlus are investing in smaller experiences with more constrained budgets and timelines.
Persona has taken the same approach as Yakuza, releasing a number of smaller spinoffs while the next mainline game is in production.
During its earning report Sega announced that during the first three quarters of its fiscal year (nine months that ended in December 2024), it sold 20 million new games. We know Metaphor makes up at least 1 million of that. At the same time, it also sold 12 million units of legacy titles, such as Persona 5 Royal and Unicorn Overlord. The sheer success of the Yakuza series seems to be proof that this approach is working, and Atlus has also taken this tack by putting out Persona spinoffs, like Persona 5 Strikers and Tactica, while working on big tentpole games like Metaphor.
As much of the rest of the industry crumbles under layoffs and project cancelations, it’s vital for companies to try alternate approaches to lower costs, and invest in the actual people making games — what really makes the industry tick.
