Midway's Q2 falls in-line

Chicago-based publisher's second quarter meets expectations; company loses $31 million for three-month period ended June 30.

It's good to be right, except when being right involves correctly projecting the loss of a bundle of cash. Midway Games reported its second-quarter financial results for the three-month period ended June 30, 2006, and the numbers were almost spot on from its prediction three months ago.

The publisher operated at a loss of $31 million for the quarter, slightly better than its May 3 outlook of a $32 million loss for Q2. Revenues rolled in at $25.9 million, a touch better than its prediction of $25 million in sales. In 2005, Midway hauled in $36.9 million and took a loss of $29.9 million over the same period.

For the first half of its 2006 fiscal year, Midway lost $53.6 million and generated $41.3 million in revenue. Over the first half of fiscal year 2005, the company lost $45.7 million on net revenues of $50.7 million.

CEO David Zucker pointed out the success of the PC game Rise & Fall: Civilizations at War, which performed well overseas. "We are especially pleased by the European performance of Rise & Fall, a new intellectual property, which topped the PC charts in the United Kingdom for the first time in Midway's history, demonstrating our new European team's ability to execute."

Even with the success of Rise & Fall, international sales were down for the quarter, with only 23.5 percent of revenue coming from overseas, versus 32.8 percent from the same period a year ago.

Zucker expects losses to continue in the short term as the company continues through the next-generation console transition. Midway's outlook for Q3 of FY06 includes net revenues of $24 million and a loss of $23 million. For the full year, Midway expects $155 million in revenue (a 3 percent increase from 2005) and a total loss of $70 million, up from its previous outlook of $66 million.

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Discussion

11 comments
ranger_waha
ranger_waha

W00t, another game with the unreal engine in it!

relset
relset

that`s a lot of money!!

Fallout_red
Fallout_red

Hopefully MK Armageddon breaks all records and sell well (Enshaa... ).

spazzx625
spazzx625

They need to crank out some more XBLA games, those should be almost all profit.

xavier14
xavier14

its ok cause midway has 3 huge games comming out. mortal kombat armageddon, strangelhold and unreal tournament 07 lol thats why they are not worry i'm not either and midway is my fav company

hemakm3
hemakm3

Hopefully selling MK on all consoles will help.

cold-flame
cold-flame

Midway's new Mortal Kombat Armageddon will most definitely sell well.

lafigueroa
lafigueroa

Maybe its fortunes will increase when its games come out this winter...