Atari Reports Q2 Loss, Driv3r Shipments

Author: by Andrew Wilson, Simon Carless

Publisher/developer Atari today outlined its financial results for the fiscal 2005 second quarter and six-month period ended September 30th, 2004. During the second quarter, Atari reported a slightly better than expected net loss of $16.9 million, or $0.14 per share, as opposed to a net loss of $28.7 million last year. However, driven in part by reasonable sales of Test Drive: Eve Of Destruction, Dragon Ball Z: Buu's Fury, Terminator 3: The Redemption, Demon Stone and Yu Yu Hakusho: Dark Tournament, as well as some continuing sales of Driv3r, Atari reported net revenue for the second quarter up 18% to $71.4 million, compared to $60.6 million this time last year, a slight improvement. Bruno Bonnell, Chairman, CEO, and Chief Creative Officer of Atari commented: "Our goal for the remainder of Fiscal 2005 is to focus on profitability through the strategic management of our catalogue of establish franchises, while keeping an eye toward the future growth of the industry," continuing: "With a strong foothold among the mass-audience and hardcore gamers, Atari will continue to be an innovator in the entertainment industry and remains on track to grow profits, ultimately creating greater shareholder value." For the six month period ended September 30th, Atari reported net revenues of $181.7 million, down from $211.9 million last year at this time. Net loss for the six-month period was $4.8 million, or $0.04 per share, as opposed to a net loss of $4.9 million and $0.07 per share last year. During the accompanying financial conference call, the company confirmed that Driv3r, which was released for the Xbox and PlayStation 2 earlier this year, has so far shipped 3 million units. Atari previously reported it had shipped 2.5 million units for its initial worldwide shipment back in June. The company also expects to ship a million units of PlayStation 2 brawler Dragon Ball Z Budokai 3, and another million of other DBZ-based titles during the fourth quarter. Lastly, with respect to the Atari Flashback Classic Game system, the company stated that it has pre-sold 500,000 units. Looking ahead to the third quarter, Atari expects net revenues in the range of $160 million to $175 million, on top of net income in the range of $15 million to $20 million. During the third quarter, Atari will or has released titles including Atari Anthology (PS2 and Xbox), Dragon Ball Z: Budokai 3 (PS2), Demon Stone (Xbox and PC), Godzilla: Save The Earth (PS2 and Xbox), RollerCoaster Tycoon 3 (PC), Sid Meier's Pirates! (PC), and the recently announced Atari Flashback 'TV game' mini-console. Meanwhile Atari's financial year ending March 31st, 2005 has guidance of net revenues between $450 million and $470 million, on top of earnings in the range of $25 million to $30 million. The fourth quarter will see Atari releasing the following titles: Act of War: Direct Action (PC), Backyard Baseball 2006 (GBA), Dragon Ball Z: Sagas (PS2, Xbox and GameCube), and Dragonshard (PC).