Sega Cutting Jobs, Expects to Post Huge Loss
The latest victim of the global recession, Sega has announced that it is soliciting applications for 560 employees, about 18% of its workforce, to retire by the end of its fiscal year on March 31, 2009.
Having “failed to swiftly respond to sharp changes in the business conditions,” Sega expects to save roughly $55.1 million on labor costs across its next fiscal year if everything goes to plan. However, the company will close or sell 110 amusement facilities and reduce its research and development costs by about 20%.
Sega currently expects to post a net loss of $236.9 million for the fiscal year, instead of its previously expected $55.1 million profit. It means that the company’s expectations are down by more than 500%, a staggering amount for anyone to bear.
All this is due to weaker-than-expected Japanese game sales and the weak Yen-Dollar exchange rates.