Tomb Raider sales fall short, Eidos shares plummet
Underworld's 1.5 million units sold worldwide fails to meet publisher's expectations; stock price drops 30 percent in response.
Eidos' troubles continued today, as the publisher formerly known as SCi announced that sales of Tomb Raider: Underworld have failed to meet its forecasts, selling only 1.5 million copies worldwide.
Eidos said difficulties in the North American market were to blame, with "retailers restricting inventory levels and triple-A products being price discounted above expectation." Due to the drop in demand and worries of ongoing price discounting in the US, Eidos has lowered its full-year revenue forecast by £20 million ($30.39 million).
The news caused shares in the company to plunge 5.25p ($.08) to 12p ($.18) in early trading this morning. Shares in the group skyrocketed at the tail end of 2005, reaching highs of 500p ($7.59), but have been in steady decline since; the company has lost 74 percent of its value in the past year.
The games industry, generally expected to weather the recession better than many sectors, has seen a multitude of job losses and bailouts, despite strong sales at retail. EA announced the layoffs of more than 500 staff back in October of last year (later doubling that figure), while Midway is still trying to settle its $150 million debt. More diversified companies, such as Sony and Microsoft, have also felt the pinch, embarking on vast restructuring plans, though the effect of these changes on these firms' gaming businesses is not yet clear.
Despite the gloom, Eidos remained positive about 2009 with the launch of the forthcoming game Batman: Arkham Asylum, stating, "We are working closely with DC Comics and Warner Bros. and through our strategic partnership we are benefitting from cross-promotional opportunities including the first video trailer for Batman: Arkham Asylum featured on all DVDs of the movie The Dark Knight this Christmas."