Take a look at the stock charts of video game software developers Electronic Arts
Now take a look at the chart of the current No. 2 independent video game publisher, the once-legendary Atari
During the second quarter, some of those things changed.
Atari completed a $131 million stock offering, as part of a $200 million recapitalization. As a result, Atari has $27 million in cash and zero debt going into the holiday quarter. The stock bounced from $1.78 on March 31 to close at $3.97 before the company announced earnings Monday afternoon.
Atari's second quarter loss was mitigated by the strength of Enter the Matrix, based on Time Warner's
For the coming holiday quarter, Atari expects sales to more than triple from $60.6 million in the second quarter to between $215 million and $235 million, with further contributions from Dragon Ball Z and new arrivals such as Terminator 3 and Mission Impossible. The company also expects to earn from $28 million to $36 million, or between $0.23 and $0.30 per share for the quarter.
We won't see Atari's big-time games Driver 3 and Unreal Tournament 2004 until the fourth quarter. But the turnaround looks to be underway, and management reaffirmed its full-year revenue and earnings guidance. After hours, the stock continued its own rebound, rising 4% to $4.12.
Jeff Hwang can be reached at JHwang@fool.com.