SEGA of America cuts 300 jobs; closes San Francisco Office in Major Restructure

Published: February 1, 2015 12:51 PM /


Sonic Boom

SEGA of America announced it would be cutting 300 employees jobs as part of major reorganization and restructure for the company's business model. Sega's San Francisco office will be closed down and moved to a Souther Californian studio.

SEGA has offered early retirement for the 300 affected in the company restructure, while others may move to the new Southern California studio. The move will take place between January 2015 and summer 2015.

SEGA noted in its press release:

“This move was crucial to keep SEGA operations moving forward throughout North America and to provide our millions of fans a strong pipeline of content across gaming, TV, merchandising, and more," said John Cheng, president and COO of SEGA of America, “We are confident that by relocating to Southern California we will be able to thrive, grow and become a stronger company because of it.”
Alien: Isolation
Alien: Isolation was one of the better selling games SEGA has produced recently


The restructure is a means to create a company wide focus on PC and mobile gaming markets.

"SEGA has positioned Digital Games, particularly smartphone and PC online gaming, as a growth area and has determined to implement the following measures in order to constantly post profits by improving management efficiency while promptly promoting redistribution of management resources."
While relocation packages are being offered to employees, a number of positions will be reduced to "streamline operations." It is unknown if additional employees will be affected, and we won't be sure until the transition is complete and finalized in early summer.
“We are sad to say goodbye to some of the best people in the business" said Cheng, "and are indebted to them for their hard work and dedication through the years.”
Though unconfirmed by SEGA or SEGA of America, speculation points to the commercial and critical failings of Sonic Boom: Rise of Lyric as a potential driving force behind this major restructure. SEGA issued a notice explaining it expected to make a mere $34 million in net profit this financial year, compared to last financial year's $260 million.

What is your take on this? Do you think the recent Sonic Boom: Rise of Lyric has anything to do with this? Sound off in the comments!

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