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by
Daniel Huebner and Jennifer Olsen
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 News
Week
of May 22-May 28, 2000
[Friday,
May 26, 2000]
Sega
Loss
Sega Enterprises is reporting its third annual loss in a row. Though the
company saw an increase in revenues of better than 27 percent, Sega still
posted a group loss of $398.1 million. This loss nearly the same as Sega's
loss last year, and is in line with analyst's predictions after Sega issued
a profit warning in February. As expected, Sega President Shoichiro Irimajiri
will resign his post and be replaced by CSK Chairman Isao Ohkawa. "We
accepted Irimajiri's request to resign to take responsibility for the
losses," Ohkawa said, "We aim to revive the company by focusing on growing
Internet-related services by using Dreamcast."
Nintendo Slip
Nintendo's annual net profit is coming in down 35 percent from last year.
The company's consolidated net profit reached $521 million for the year,
with most of the fall from last year's mark being attributed to an overly
strong yen. Nintendo earns over three quarters of its sales overseas,
and the strength of the yen contributed to erosion of more than $500 million
from the company's overseas sales and assets. Though Nintendo missed the
profit projections of most analysts, the company's forecast of a 46.3
percent jump in profits for coming year is better than expected. Nintendo's
forecast for the coming year does not include the company's next generation
Dolphin console, a sign of a possible launch delay.
[Thursday,
May 25, 2000]
Looking
Glass Gone
Thief developer Looking Glass is closing its doors. The decision
was made in a company meeting yesterday, and as of today the company has
closed and all ongoing projects have been cancelled. Despite strong sales
of Thief and Thief 2, Looking Glass has been struggling
financially. The company's hopes for a capital infusion from publisher
Eidos apparently fell victim of Eido's own financial problems. Amongst
the cancelled titles is Thief 3, though in an open letter to fans
designer Randy Smith expressed doubts that the game would ever see the
light of day.
Take-Two
and Empire
Empire Interactive is handing its North American distribution rights to
Take-Two. The agreement between the two companies sends Empire's console
catalog to Take-Two, while Take-Two subsidiary Talon Soft gets Empire's
PC titles. "We chose to work with Take-Two because of their undisputed
expertise in selling, marketing and distributing computer and video games,"
said Empire Interactive General Manager Mark Scriven. The first titles
released under the new agreement are expected to ship in the summer of
2000.
Red
Storm Promotion
Red Storm is making changes in the front office. Elizabeth Loverso, formerly
Red Storm's operations manager, is moving to the position of external
development manager for the United States. That position became available
when current external development manager Kevin Perry moved to a new job
overseeing in house design and development for next generation console
titles. "[Loverso's] extensive industry experience will ensure Red Storm's
future acquisition and production of quality externally developed titles,"
said company CEO Doug Littlejohns.
Titus Grabs More Interplay
Interplay is calling a special shareholder meeting to discuss Titus' plans
to purchase more shares. The shareholder's meeting will examine Titus'
offer to purchase an additional 719,424 share of Interplay for $20 million.
The offer stems from a deal made in April in which Titus gave Interplay
$20 million, cash that Interplay could either pay back with interest or
allow Titus to convert into shares in May. Interplay's special meeting
will also discuss the election of new directors and the appointment of
an independent auditor.
[Wednesday,
May 24, 2000]
Voodoo
Delayed
3dfx is pushing back the retail launch of its Voodoo 5 line because of
potential product failures. The company reports receiving word of a low
number of failures in specific configurations and is the delaying the
release of the Voodoo 5 5500 AGP so that it can investigate the problem.
The delay is expected to be between one to two weeks. "We believe that
this affects only a small number of configurations," said 3dfx's Randy
Schussler, "but we feel this is the safest thing to do."
3dfx
Surge
3dfx is reporting big gains in revenue for the first quarter of its 2001
fiscal year. The company posted revenues of $108.6 million for the quarter,
significantly better than the $40.4 million the company brought in during
the same period one year ago. Gross profit gains were more modest, increasing
to $26.4 million for the quarter versus last year's result of $14.2 million.
One key ingredient of 3dfx's first quarter success is the shift in sales
this quarter to primarily board level products, while last year at this
time the company was still selling mainly chip level products. Increasing
revenues, however, have yet to put an end to the company's red ink, as
net losses continued to build. 3dfx posted a net loss of $12.4 million
for the first quarter, well beyond the loss of $2.2 million in the first
quarter last year. "Our clear and immediate goal is to return to profitability
and then move on with the task of obtaining significant growth by developing
new markets for our 3D chips," said 3dfx Chairman Alex Leupp.
Game
Boy Advance Delay
Nintendo is confirming that Game Boy Advance won't launch this summer.
As many had expected, Nintendo will delay the launch of the new machine
from its previously anticipated August release to a new date in November
or December. Officially, Nintendo is placing the blame for the delay on
difficulties in securing LCD's and integrated circuits for the new handheld.
Much of the the available supply, however, is still being funneled into
production of the current Game Boy Color, which continues to hold better
than 90 percent of the handheld console market and accounts for nearly
30 percent of Nintendo's total revenue.
ATI Warning
ATI is warning investor that market conditions will result in a third
quarter loss. The company is blaming a number of factors, including a
product transition, competitor pricing, and component shortages for the
expected loss of 35 cents a share. Analysts had expected ATI to show a
profit of 13 cents a share for the quarter. "We definitely have some tough
challenges ahead of us," explained ATI CEO K.Y. Ho, "But our strategic
direction remains sound and we remain optimistic for the next fiscal year."
ATI will release its full financials on July 6.
[Tuesday,
May 23, 2000]
Sega
Confirmation
Sega is confirming a shuffle of the top brass. As speculated, Sega Enterprises
President Shoichiro Irimajiri will step aside to allow Isao Ohkawa, president
of Sega parent company CSK, to takeover. Ohkawa is moving into the hot
in order to oversee a massive restructuring of Sega's development activities.
The reorganization plan, originally announced in November, will split
Sega's interested into a total of nine separate units organized by region
and specialty. Irimajiri will stay on in a vice presidential role to focus
on the creation of a Dreamcast successor.
[Monday,
May 22, 2000]
Reinhart
Exits
Unreal Tournament programmer Brandon Reinhart is leaving Epic.
Reinhart is leaving Epic Games behind for a bigger role on another high
profile first person shooter, 3D Realms' Duke Nukem Forever. Epic
Vice President Mark Rein wished him well in a circulated email. "He chose
the best possible time with the least possible impact to our current projects
and for that we're grateful. We'll miss Brandon but we wish him great
success at 3D Realms."
Sega
Coup
Sega Enterprises isn't commenting on reports of a presidential resignation.
Japan's Nihon Keizai Shimbun is reporting that Shoichiro Irimajiri will
resign the post of president because of poor Dreamcast sales in Japan.
The reports go on to suggest that Irimajiri will take a lesser role in
design and development of a Dreamcast follow-up, and that parent company
CSK chairman Isao Ohkawa will take over Sega's top spot.
Activision
Ups Buy
Activision will buy back more stock than previously planned. The company's
board of directors approved a $5 million increase to the $10 million stock
repurchase plan they had devised on May 9, bringing the total buy of common
stock and convertible notes to $15 million. The move follows on a shareholder
protection plans as Activision's board attempts to protect the company
from any unwanted takeover attempts.
PC Data's Top 10
No great changes in PC Data's top ten list of best selling games for the
week of April 30-May 6, 2000.
1. The Sims, Electronic Arts
2. Who Wants To Be A Millionaire, Disney
3. Ever Quest: Ruins Of Kunark, 989 Studios
4. Roller Coaster Tycoon, Hasbro Interactive
5. Microsoft Age of Empires II: Age Of Kings, Microsoft
6. Who Wants To Be A Millionaire 2nd Edition, Disney
7. Grand Slam Bridge III, Electronic Arts
8. Jane's WWII Fighters, Electronic Arts
9. Aliens vs. Predator Gold, Fox Interactive
10. Roller Coaster Tycoon Corkscrew Follies, Hasbro Interactive
Past
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