Major video game console maker Sega Enterprises announced Friday that President Shoichiro Irimajiri will step down as of June 1 to take responsibility for the firm’s poor business performance.
Isao Okawa, chairman of Sega and a leader of the CSK-Sega group, will take over Irimajiri’s post on June 1. Okawa currently serves as chairman of CSK Corp., which is Sega’s largest shareholder, with a 24.5 percent stake.
Irimajiri will become vice chairman and be in charge of the launch of broadband network services in consumer and amusement businesses, the firm said.
Sega is fighting an uphill battle against Sony Computer Entertainment and Nintendo Co. in the domestic video game market as Dreamcast, its latest video game console, is suffering from weak domestic sales.
“The amount of losses (in fiscal 1999) was beyond our forecast. Although Dreamcast made good starts in the United States and Europe, domestic sales did not work as I had planned,” Irimajiri told a press conference.
Sega has sold 1.78 million units of Dreamcast in Japan since it was launched in November 1998, including 950,000 units in fiscal 1999.
In contrast, SCE has so far shipped about 1.8 million units of PlayStation2, a hit video game console, since its launch on the domestic market in March.
Sega Enterprises posted 44.3 billion yen in pretax losses and 42.9 billion yen in net losses on a consolidated basis for the business year that ended on March 31, reporting a loss for the third consecutive year.
Although consolidated sales grew 27.4 percent from the previous year to 339.1 billion yen, the firm reported 40.4 billion yen in operating losses due to sales promotion costs launching Dreamcast in the United States and Europe.
In fiscal 1999, Sega sold 2.5 million Dreamcast units in the United States, 1.04 million units in Europe and 160,000 units in Asia.