Atari's Q3 revs sink more than a third

Publisher cites weak holiday season, game delays for financial woes; says 2007 is a year "of focus," more portable titles such as Battlezone for the PSP.

The good news for Atari is its Q3 report for fiscal year 2006 is better than its Q1 and Q2 reports for the same year. The bad news for the France-based company is that the first half of its business year was so bad that it really couldn't get much worse.

The game publisher announced its Q3 earnings today, and net revenues were down more than one-third. For the quarter ending December 31, 2005, revenue was $100.8 million, compared to $156.4 million in the same period in 2004. Net loss for the period totaled $4.8 million, well down from the net income of $19.6 million earned in Q3 2004.

However, given the grim reports for the previous two quarters, Q3 was almost a ray of sunshine. Revenue for the nine-month period ending December 31, 2005, was $163.4 million. For the same period in 2004, revenue was more than double that figure, at $332.5 million. Whereas last year's take was $14.8 million for the first three quarters of the year in 2004, 2005's first nine months saw an unsightly $62.8 million in losses.

The bright spots for the company were Dragon Ball Z: Budokai Tenkaichi for the PlayStation 2, Dragon Ball Z: Super Sonic Warriors 2 for the Nintendo DS, The Matrix: Path of Neo for the Xbox, PS2, and PC, and the plug-and-play console Atari Flashback 2. However, the retail successes of said games were not enough to counter an exceptionally slow holiday season and game delays, most notably the postponement of the multiplatform Mark Ecko's Getting Up: Contents Under Pressure.

Atari also announced today that executive vice president and CFO Diane Baker has resigned from her position "to pursue a new opportunity." The company has not named an immediate replacement.

Looking toward 2007, CEO Bruno Bonnell clearly laid out Atari's plans. In a question-and-answer session with analysts after the numbers were laid out, he said, "We will focus our efforts on capitalizing on established franchises... And we will look to grow our market shares on portable devices such as Nintendo DS and Sony PSP."

Atari revealed some new games, set for release sometime in the company's next fiscal year, which will spearhead Bonnell's strategy. The company confirmed that the next edition of Stuntman, a racing simulation in which players relive the exploits of Hollywood's daredevils, will be released on the Xbox 360. The Alone in the Dark franchise has a new subtitle, Near Death Investigation, and a new platform, the PC. Heading its attack on the PSP is the newly announced Battlezone, a license that Atari has had from its days as a coin-op arcade giant. Not going into specifics and surprising no one, the company also revealed that it will release more "titles from the Dragon Ball Z franchise."

The market's response reflected the disappointing news. Atari opened the day at $.91 per share, but dropped to $.60 per share in after-hours trading.

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Discussion

33 comments
1PSman
1PSman

LOL $.60 cents a share.

classicwhiteguy
classicwhiteguy

yea..atari use to be on the top and now they can hardly even do anything with a such a small income compare to other companies ..so i'm guessing that atari might go out some time in the near future...with the next geration of gaming just around the corner.....how is atari even going to profit..when its going to cost more to make a game and also that its going to be a bigger risk than ever before....

DelphiDevil
DelphiDevil

A way for Atari tp stay aflot would be Mark Ecko's Getting Up: Contents Under Pressure, Neverwinter Night 2 a couple of DBZ games and a good steady income MMO (D&D Online: Stormreach would be good to fill in that slot).

jonthebold16
jonthebold16

Atari needs to get its act together and make maybe one or two decent games to get them back into the black.

Argama7
Argama7

Dear Atari, here is a tip: Invest in good games.

JumpingMirrior
JumpingMirrior

Maybe this will make them focus and actually create good games

Kounji
Kounji

I'm hoping so much that they get their act together. Even though atari isn't necessarily the same company that tanked in the late eighties, for them to fail would mean that name would be gone for ever. For me personally it's like what would happen once nintendo and sega officially bought it. It's like losing a parent in this case like a grandfather. I think atari can still do well maybe they need to focus a bit more on marketing their game titles. They have actually a lot of descent games out there that I can think of. Nearly all of their d&d games are fun the budokai series is fairly good. They just need to fucs on pushing their games a lot better. I'm hoping they do well this year with Stormreach and Neverwinter Nights 2 for either to be successful would be a great boost to their company especially having a successful mmo. I just wish stormreach had came out before wow cause it would of had a much better chance before then. They definitely need a few hits this year though that for sure

Riddick123
Riddick123

How about they quit throwing money around and develop a decent game. There is a novel idea.

s0l0123
s0l0123

Atari, make more DBZ games like Budokai Tekaichi!

frankeyser
frankeyser

if there games were not so under deveoped and were actually debugged i think they might do ok.

kaziechameleon
kaziechameleon

he i love atari they have contributed so much in the way of good games to our industry and art, to bad for every good game there are like 10 bad ones, atari seems to throw their money around alot on games that just aren't that good, why i don't know, but if we lost these guys it would be very sad.

southy787
southy787

Atari should make games like they always have, just market them to older rather than newer / casual gamers. Older gamers appreciate that Atari can make high quality games and compete with other game developers and so they should perhaps make a retro style game which would cost less to develop and design but would appeal to the older generation.

kees2580
kees2580

What kind of games do you think Atari should make in 2006?

molivers7
molivers7

Atari is based in France? I guess the rumor of them buying up SWG is just that, a rumor. Crap.

chrisdojo
chrisdojo

they only pwnet them selves!

Reetesh
Reetesh

The Company Shouldn't Go Bankrupt if It is able to recover It would be nicfe as, Atari is like ATARI, It Published Many Great Games, Hope Mark ecko is good.

SLAYERPSP
SLAYERPSP

i feel bad for atari they were my first love back in the 2600 days hope they can pull it together but if not the name will live forever. lets hope the new driver game is better i still liked the last game but it could have been so much better

azizrulez
azizrulez

they werent uotp the mark last year i hope this year is better

buffysummer
buffysummer

I do not like Dragon Ball, they should make a new game

EBWCLIF
EBWCLIF

I used to work for that crap company. The stock was at $11 a share when I was there. Way to fail Atari.

i_love_my_ds
i_love_my_ds

atari doesnt make good games. anyone remember enter the matrix and driver 3?

juanmarcop
juanmarcop

They'll do better this year with the release of the other two NEXT-GEN consoles.

Cunder
Cunder

what they need to do is think up a new creative game

Donkeljohn
Donkeljohn

From a net income to a net loss? Not a good sign