In an interview with Famitsu, Sega CEO Shuji Utsumi said that the company still values physical games and is not going to completely abandon the traditional approach.
Since we started as a platform provider, we naturally still value the culture of physical sales. Instead of completely abandoning this, we are now working on a transition to simultaneously account for important aspects of the digital world.
Sega notes the importance of physical games, which played a large role in the company's history and helped bring about projects such as classic Batman games, Cool Spot, McDonald's Treasure Land Adventure, Moonwalker, and RoboCop Versus The Terminator.
The topic became relevant again after Sony's decision to begin phasing out physical games for PlayStation starting in January 2028.