No big surprise here. Midway Games
Net sales revenues declined 30% to $25.9 million. There was a gross loss of $1.4 million, compared to a gross profit of $1.9 million in the year-ago period. The operating loss expanded 5% to $30.3 million, while the net loss increased 4% to $31 million, or $0.34 per diluted share.
The six-month statistics aren't any better. Net sales revenues plunged 19% to $41.3 million. The gross loss was $0.7 million, versus a gross profit of more than $7 million. The operating loss increased 18% to $52.1 million. The net loss came in at $53.6 million, or $0.59 per diluted share, which represented a widening of roughly 17%.
This is pretty much par for the course, sad to say. Midway just isn't in the league of an Electronic Arts
As I've stated before, however, I just don't see Redstone's interest as enough of a reason to buy into the publisher. Besides the GAAP losses, the lack of cash flow is most disheartening; it doesn't spell long-term Foolish value. Neither does Midway's slate of games. Although the company does have its fair share of licensed products -- such as cartoon properties from Time Warner's Cartoon Network and the recent animated project The Ant Bully -- it can't seem to leverage them to create value. In addition, other major publishers have licenses with arguably greater marquee value, such as THQ and its Nickelodeon and Disney/Pixar titles.
If you want to trade Midway based on Redstone's purchases, best of luck to you. The better option would be to check out EA or THQ. It's funny, because I own a Midway collection for the Nintendo Gamecube that I absolutely love; I mean, who isn't up for a couple waves of Defender, or a few sessions of city-destroying with Rampage? It's too bad I can't say the same thing for Midway as a potential investment idea.
More Takes on Midway and its competition:
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