In April 2023, Sega confirmed it would be purchasing esteemed mobile studio Rovio, best known for its Angry Birds series of games (and movies, TV series, merchandise, and theme parks). The acquisition promised that Rovio would help Sega muscle its way into the mobile gaming space, but gamers, especially Sonic fans, weren’t particularly thrilled, especially when they realized Rovio would get its hands on their beloved blue hedgehog.
It now seems that, alongside Sonic fans, Sega may be unhappy with its purchases, as it has just revealed that it has had to make a one-time write-off of over $200 million because the deal hasn’t quite worked out.
Sega Writes Off $200 Million Because “The Mobile Game Market Rapidly Changed”
In a “Notice of Recording of an Extraordinary Losses and Revision of Operating Forecast” letter to its shareholders, Sega Sammy revealed that it has been forced to write off just under $200 million from the value of Rovio.
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“Following Rovio’s integration into the Group, the business environment in the global mobile game market rapidly changed, with multiple major titles emerging within a short period, and competition for customer acquisition intensifying,” Sega said. “Rovio found it difficult to advance its initially planned business development, and the profitability of this business has fallen below the initial forecast.”
The statement adds that Sega conducted a review and impairment test, revealing “the recoverable amount related to Rovio significantly fell below its carrying amount.” This effectively means that Sega admits paying more for Rovio than it is currently worth, with the recoverable amount being what Sega expects to get back through future profits or any future sale.
Rovio found it difficult to advance its initially planned business development, and the profitability of this business has fallen below the initial forecast.
As a result, Sega announced that “the impact on the net loss attributable to owners of the parent recognized in the third quarter of the fiscal year ending March 2026 amounted to approximately ¥30.4 billion ($198 million).”
With Sega purchasing Rovio for ¥118 billion ($776 million), this write-off means they now value the company at around ¥86.7 billion (approx. $578 million USD).
This lower value comes in the wake of not-so-great output from Rovio post-acquisition. The company helped with marketing for the doomed Sonic Rumble and has released Sonic Blitz, Angry Birds Block Quest, and Angry Birds Bounce, none of which have particularly tipped the scales for either franchise.
Despite the Rovio losses, Sega is in a relatively good spot. Although none of the company’s upcoming games have release dates, we know it has a few in the pipeline, including Persona 4 Revival and Persona 6, and it reported solid sales for itsexisting titles last quarter. Sonic games sold 1.76m units, Like a Dragon, 1.23m, Persona 980k, and Total War, 1.38m (via Genki_JPN).
