Sega to Cut Jobs, Focus on Games for Others

Sega Corp., which is struggling to be profitable after four straight years of losses, said it will cut 312 jobs, or about 30% of its work force in Japan, as it moves to slash costs and debt. The announcement comes as Sega focuses on developing game software for other companies as a way to return to profitability after the company scrapped its flagship Dreamcast console last month. The job cuts will be made with buyouts and early retirement plans, rather than layoffs, throughout the fiscal year to March 2002. Sega will sell its stakes in 27 companies, along with some subsidiaries, welfare facilities for employees and, if necessary, its headquarters building in Tokyo. The game maker said it plans to spend $119 million to develop 118 home-use video games this year, aiming at sales of more than $532 million on games for the Dreamcast console. The company also said it will develop game titles for Nintendo Co.’s GameCube console, set to debut in Japan in September. The Sega said it expects to break even in the current fiscal year and achieve a 15% operating profit margin in the year ending March 2003.