The company's net revenue for the quarter which ended December 1, 2002 was down 22% from the previous year, to $63.1 million. The company attributed the loss to "weak performance of [Acclaim's] titles in the North American retail market". During the quarter the company released Burnout 2: Point of Impact
, BMX XXX
, Legends of Wrestling 2
, Dave Mirra Freestyle BMX 3
and Mary-Kate & Ashley Sweet 16
for various console platforms. In particular, the company had hoped that BMX XXX
would be a successful foray into the world of adult-themed videogames, but the game clearly did not live up to the company's expectations. It received limited distribution due to retailer objections over its content, and saw mediocre-to-poor reviews.
Besides lower revenue, Acclaim was hit by significantly higher operating expenses. For the quarter, operating expenses reached $42.5 million, up significantly from $31.6 million last year. Going forward, the company said it would attempt to reduce operating expenses "to align them with projected revenues".
The bottom line is that Acclaim reported a net loss of $13.9 million (15 cents per share) for the quarter, compared to a $17.4 million profit last year in Q1.