MAJESCO REPORTS RECORD SECOND QUARTER 2005 FINANCIAL RESULTS

EDISON, N.J, June 7, 2005 -- Majesco Entertainment Company (NASDAQ: COOL), an innovative provider of digital entertainment products and content , today announced results for its second quarter ended April 30, 2005.

The Company reported record second quarter net revenues of $19.9 million, compared to $17.0 million for the same period in 2004. Gross profit increased to $8.4 million, or 42.4% of net revenues for the second quarter, compared to $5.4 million, or 31.9% of net revenues for the same period in 2004. Operating income was $821,000 for the 2005 quarter, versus $1.1 million for the same period one year ago. The decrease in operating income is attributable to infrastructure to support the Company's growth, as well as fulfilling obligations as a NASDAQ-listed company.

For the quarter, the Company generated net income of $189,000 compared to a net loss of $49.0 million for the second quarter of last year. The 2004 net loss was principally the result of a non-cash charge related to the issuance of warrants in connection with the Company's private placement in February 2004 (see tables for further explanation). Excluding the non-cash charge the Company would have generated net income of $208,000 for the 2004 period. Net income applicable to common stockholders for the 2005 quarter was $0.01 per share compared to a net loss applicable to common stockholders of ($8.35) per share for the same period last year.

For the six-month period ended April 30, 2005, the Company reported net revenues of $50.6 million, an increase of 21.4% versus $41.7 million in the same period during 2004. Gross profit increased to $19.4 million during the six-month period, versus $12.9 million in the comparable period during 2004. For the 2005 period, operating income was $2.8 million versus $3.5 million in the comparable 2004 period. Net loss applicable to common stockholders for the 2005 six-month period was ($0.01) per share, compared to net loss applicable to common stockholders of ($9.59) per share for the same period of last year.

The Company completed the second quarter with working capital of $62.1 million, representing a current ratio of 4.3, versus working capital of $8.9 million or a current ratio of 1.3 at year end October 31, 2004. Stockholders' equity as of April 30, 2005 was $76.1 million compared to $13.8 million as of October 31, 2004. The increase in the Company's working and capital stockholders' equity was principally due to the completion of its public stock offering in January 2005 and the related warrant exercises, which provided $60.5 million in net proceeds.

Jan E. Chason, Majesco's Chief Financial Officer commented, "Our record second quarter net revenues were driven by the introduction of Psychonauts for the Xbox and PC, double game packs (2 games in 1) value games, and continued strong sales of TV Arcade. Our gross margin increased to 42.4% for the quarter, underscoring the strength of our diversified product offerings. The increased expenses for the quarter were directly related to infrastructure growth to better position the Company for the future. We expect this level of expenditures to continue as we prepare to release key products in the coming quarters, implement new support functions and compliance and testing related Sarbanes-Oxley."

Carl Yankowski, Majesco's Chairman and Chief Executive Officer, commented, "During the second quarter we announced several new premium game titles aimed at expanding our market share, as well as positioning Majesco to benefit from the upcoming hardware transition. We are proud of the reception our diverse new products received at E3. We are entering the important second half of our fiscal year with confidence that we are well positioned to achieve our objectives for full year 2005. We remain focused on global growth, both organic and otherwise."

Key Products

• Advent Rising , the first title in a planned trilogy of games, has been developed in collaboration with award-winning science fiction author Orson Scott Card. This title shipped on May 31 st for the Xbox and PC.

• Psychonauts , the critically acclaimed title developed by award-winning game designer Tim Schafer, will ship for the PlayStation^®2 computer entertainment system this June. Psychonauts also shipped for the Xbox ^® video game system from Microsoft and PC on April 19, 2005.

• JAWS TM Unleashed, based on one of the most enduring action-suspense films of all time, is being developed by Appaloosa Interactive. The game features an innovative twist where players assume the role of the shark. JAWSUnleashed is planned for release late this summer for the PlayStation ^® 2, Xbox ^® and PC.

• Infected, a thrilling new run-and-gun shooter that allows players' avatars to invade opponents' PSP ^TM systems via multiplayer victories. Infected is scheduled to ship for the 2005 holiday season and is the first release in an exclusive three-game PSP deal between Majesco and Planet Moon Studios.

• Aeon Flux, scheduled to coincide with the theatrical release starring Oscar^®-winning actress Charlize Theron as Aeon Flux, is based on Peter Chung's popular futuristic MTV animated series and features a palpitating blend of stealth, speed and acrobatic combat.

• Demonik , developed by Terminal Reality in conjunction with Tiger Hill Entertainment, is a next-generation, third-person action game that allows players to control the ultimate bad guy-wreaking havoc scenario with a variety of innovative and spectacular powers and abilities. The game is being produced in collaboration with acclaimed writer/director Clive Barker and is scheduled to launch in 2006.

• The Darkness , based on the best-selling Top Cow comic book, is a seamless and unique blend of modern crime drama and supernatural horror through first and third person, non linear game play. The Darkness is being developed for the next generation consoles by Starbreeze Studios.

• Taxi Driver TM based on the classic Martin Scorsese directed film from Columbia Pictures, is being developed by Papaya Studio and is scheduled to ship in spring 2006.

• Paintball, Texas Hold'em, Strawberry Shortcake and Frogger highlight our Wireless Plug and Play TV Arcade product line-up for Holiday 2005.

2005 Outlook

Management reiterated its expectations for fiscal 2005 of net revenues of $175 - $185 million and operating income of approximately $16 to $18 million. This guidance includes consideration for planned increased investment in marketing as well as increased infrastructure to support the Company's anticipated growth and to meet the requirements of being a NASDAQ traded company and to comply with Sarbanes-Oxley requirements.

Conference Call

At 5:00 PM EST (2:00 PM PST) today, management will host a conference call to discuss the results.

To listen to the call, please dial 888-694-4676, approximately five minutes prior to the start of the call. International participants can access the call by dialing 973-935-8512. For those who cannot listen to the live conference call, a replay will be available until midnight on June 14, 2005. The access number for the replay is 877-519-4471 for U.S. participants and 973-341-3080 for international participants. The conference identification code is 6120440.

Additionally, the call will be web cast by ViaVid Broadcasting and can be accessed at Majesco's website at www.majescoentertainment.com. The web cast may also be accessed at ViaVid's website at www.viavid.net. To access the web cast, you will need to have the Windows Media Player on your desktop. For the free download of the Media Player please visit: http://www.microsoft.com/windows/windowsmedia/en/download/default.asp.

MAJESCO ENTERTAINMENT COMPANY

CONSOLIDATED BALANCE SHEET

(in thousands, except share amounts)

April 30, October 31,

2005 2004

(unaudited)

ASSETS

Current assets

Cash and cash equivalents $ 16,038 $ 4,170

Due from factor 23,402 9,491

Inventory 13,311 12,755

Capitalized software development costs and prepaid license fees - current

portion 21,637 10,574

Prepaid expenses 6,353 831

Total current assets 80,741 37,821

Property and equipment - net 834 798

Capitalized software development costs and prepaid license fees 12,507 4,952

Other assets 691 381

Total assets $ 94,773 $ 43,952

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Accounts payable and accrued expenses $ 15,319 $ 19,985

Inventory financing payable 3,107 6,750

Advances from customers 198 2,171

Settlement obligations - current portion - -

Loans payable - shareholders - current portion - -

Advance from officer - -

Total current liabilities 18,624 28,906

Settlement obligations - -

Capital lease obligations - -

Loans payable - shareholders - -

Dividend payable in common stock - 1,261

Commitments and contingencies

Stockholders' equity:

Common stock - $.001 par value; 250,000,000 shares authorized; 22,226,230 and 15,403,704 issued and outstanding at April 30, 2005 and October 31, 2004, 22 15 respectively

Series A Convertible Preferred stock - $.001 par value; 10,000,000 shares authorized; 1,000,000 shares designated and 132,142 shares issued and outstanding at October 31, 2003. - -

Additional paid in capital 91,758 29,194

Accumulated deficit (15,599) (15,388)

Accumulated other comprehensive loss (32) (36)

Total stockholders' equity 76,149 13,785

Total liabilities and stockholders' equity $ 94,773 $ 43,952

About Majesco Entertainment Company

Headquartered in Edison, NJ, Majesco Entertainment Company ( NASDAQ : COOL ) is an innovative provider of digital entertainment products and content . The Company's three product lines include Games, which includes the recently released Advent Rising, and highly anticipated titles such as JAWS ^TM Unleashed and Aeon Flux; Videos, which highlights the Company's platform-independent video compression technology; and Gadgets, which includes innovative digital entertainment products like Frogger ^®TV Arcade. More information about the Company can be found online at www.majescoentertainment.com.

Safe Harbor

Certain statements contained herein are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by reference to a future period(s) or by the use of forward-looking terminology, such as "may," "will," "intend," "should," "expect," "anticipate," "estimate" or "continue" or t he negatives thereof or other comparable terminology. The Company's actual results could differ materially from those anticipated in such forward-looking statements due to a variety of factors. These factors include but are not limited to, the demand for our products; timely development and release of our products; the ability to secure licenses to valuable entertainment properties on favorable terms; continued consumer acceptance of the gaming platforms on which our products operate and our products; competitive factors in the businesses in which we compete; fulfillment of orders preliminarily made by customers; the ability to attract and retain key personnel; adverse changes in the securities markets; and the availability of and costs associated with sources of liquidity. The Company does not undertake, and specifically disclaims any obligation, to release publicly the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

Published by Majesco Entertainment Company ® 2005. All Rights Reserved. "Frogger" is a registered trademark of KONAMI CORPORATION. ®1981 2005 KONAMI (C) ARC SYSTEM WORKS Co., Ltd. Licensed from TAITO CORP. JAWS is a registered trademark and copyright of Universal Studios Licensing LLLP. All Rights Reserved. Developed by Appaloosa Interactive. "Frogger" is a registered trademark of KONAMI CORPORATION. ®1981 2005 KONAMI The Darkness^® and ® 2004 Top Cow Productions, Inc. All rights reserved. Developed by Starbreeze Studios AB. Taxi Driver^TM & ®1976, 2005 Columbia Pictures Industries, Inc. All Rights Reserved. ® 2005 Paramount Pictures, a division of Viacom International Inc. All Rights Reserved. "AEON FLUX" and all related titles and logos are trademarks of MTV Networks, a division of Viacom International Inc. Golden Nugget ^® and ® 2005. Black & White is a registered trademark of Lionhead Studios Ltd. All rights reserved. Infected ® 2005 Planet Moon Studios. All rights reserved. Strawberry Shortcake^TM ® 2004 Those Characters From Cleveland, Inc.