Midway's Q2 falls in-line

The publisher operated at a loss of $31 million for the quarter, slightly better than its May 3 outlook of a $32 million loss for Q2. Revenues rolled in at $25.9 million, a touch better than its prediction of $25 million in sales. In 2005, Midway hauled in $36.9 million and took a loss of $29.9 million over the same period.

For the first half of its 2006 fiscal year, Midway lost $53.6 million and generated $41.3 million in revenue. Over the first half of fiscal year 2005, the company lost $45.7 million on net revenues of $50.7 million.

CEO David Zucker pointed out the success of the PC game Rise & Fall: Civilizations at War, which performed well overseas. "We are especially pleased by the European performance of Rise & Fall, a new intellectual property, which topped the PC charts in the United Kingdom for the first time in Midway's history, demonstrating our new European team's ability to execute."

Even with the success of Rise & Fall, international sales were down for the quarter, with only 23.5 percent of revenue coming from overseas, versus 32.8 percent from the same period a year ago.

Zucker expects losses to continue in the short term as the company continues through the next-generation console transition. Midway's outlook for Q3 of FY06 includes net revenues of $24 million and a loss of $23 million. For the full year, Midway expects $155 million in revenue (a 3 percent increase from 2005) and a total loss of $70 million, up from its previous outlook of $66 million.