In a rotating machine comprising a rotor including a rotor core and a plurality of permanent magnet segments, and a stator including a stator core and windings, the permanent magnet segment is obtained by disposing a powder comprising an R.sup.2 oxide, R.sup.3 fluoride or R.sup.4 oxyfluoride on a sintered magnet body of R.sup.1--Fe--B composition, wherein R.sup.1 to R.sup.4 are rare earth elements, and heat treating the powder-covered magnet body. The permanent magnet segment of a cross-sectional shape which is tapered from the center toward opposed ends has a higher coercive force at the ends than at the center.