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Midway Cuts Full Year Forecasts
by David Jenkins [PC, Console/PC]
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November 2, 2005
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Officials from major publisher and developer Midway Games have announced that the company’s third quarter losses are expected to be wider than expected, and that full year financial forecasts have been cut as a result.
The company’s third quarter loss is now expected to be $29 million, compared to a previous forecast of $19 million. Revenue predictions are unchanged at $30 million, with the final results due to be published on Monday. As a result of the increased loss, the company’s annual loss is expected to be approximately $95 million, compared to previous forecasts of $60 million. Annual revenue forecasts have also been lowered from $200 million to $145 million.
The increase in third quarter losses have been attributed to lower than expected reorders for recent titles, most notably L.A. Rush and The Suffering: Ties That Bind. The company had recently been linked with takeover rumors for British company SCi, now owners of Tomb Raider publisher Eidos, on the back of previous statements concerning a desire to expand and acquire new studios. It is unclear whether the prospect of disappointing financial results will affect expansion plans.
As for Midway's share price, it started the day sharply down, following the announcement, but has been snaking slowly back throughout the day, and is currently down just $0.54 on the day at $19.34.
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