Midway reports first-half loss, drops full-year projections

Publisher Midway Games has announced its results for the first half of 2004, revealing a $25.7 million loss during the six month period - although rising revenues support claims that the firm will turn around in 2005.

$10.7 million of the loss was recorded in the second quarter; however, the company's revenues comprehensively beat their previous guidance and last year's figures, with $67.4 million of revenue recorded in the first half as compared with $16.6 million last year.

Revenues in the second quarter were particularly strong, up to $47.3 million from last year's $5 million - thanks mostly to strong sales of MLB SlugFest, NBA Ballers and Psi-Ops. It's also worth noting that while the first half loss is quite large, it's a major improvement over last year, when the company lost $65.3 million in the first half.

Although the company has only three more titles scheduled for launch by the end of this year, it hopes to record a profit for the coming six months, reducing the firm's overall losses for the year to $20 million - $2 million more than its previous projections, but still a major improvement over 2003.

Midway, which is now over 80 per cent owned by Viacom chairman Sumner Redstone, has moved the biggest title on its 2004 holiday schedule back into 2005, with Xbox and PS2 shoot 'em up title Area 51 being pushed into the new year - in a move which, according to company president David Zucker, will garner it "much more attention in a launch period with comparatively less crowding."

"The extraordinary annual losses are behind us," Zucker said of today's results. Midway hopes to turn around its fortunes in 2005; although much of the company's future will depend on what Redstone chooses to do with it. Many commentators have speculated that he may intend to take the company private, withdrawing it from the stock market and potentially arranging its sale to media empire Viacom.