As part of a downsizing for the company, SEGA of America President John Cheng announced that their North American operations will move from San Francisco to Southern California, with relocation packages being offered to many employees. Unfortunately, there will be layoffs to “streamline operations,” with the full number of affected people being finalized in the summer.
Cheng talked about the move:
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 We are confident that by relocating to Southern California we will be able to thrive, grow and become a stronger company because of it.
He added, “We are sad to say goodbye to some of the best people in the business and are indebted to them for their hard work and dedication through the years.”
SEGA’s current schedule of games will be unaffected by the move, with the Sonic Boom TV show continuing to run through 2015.
Elsewhere with SEGA, the company is looking to constantly post profits, and are planning to focus on Digital Games as a growth area, which includes mobile and PC online gaming. SEGA is also expecting to give around 120 employees voluntary retirement over the next few weeks:
Voluntary retirement will be solicited in the aforementioned businesses to be withdrawn or consolidated and downsized, while at the same time personnel will be repositioned in Digital Games and growth areas of Group mainly as development personnel, in order to establish a structure which can constantly generate profits. The purpose of these measures is to improve the business efficiency of the Group.
In an update after this news was revealed, SEGA of Europe revealed there may be limited redundancies on their part:
We are under consultation with a limited number of staff in the European publishing business and will be able to confirm decisions regarding any potential redundancies in the coming weeks.
Despite all this, SEGA is still expected to make a profit this fiscal year, though it will be much smaller than the previous year.