Atari has just posted its Q4 (ending 31 March 2006) and full year financials for the 2006 fiscal year earlier today, reporting a shocking net loss to the tune of US$67million over the year.
This compared to net profits in 2005 of $5.7million. It seems that a combination of poor sales and that old chestnut, ‘the transitional year’ has hit the company hard where it hurts.
The company issued an official statement, which sombrely outlines the situation: "As the year-end results were substantially below the Company's expectations, the uncertainties resulting from the Company's financial condition raise substantial doubt about the Company's ability to continue as a going concern."
Bruno Bonnell, Atari’s Chairman, CEO and Chief Creative Officer added: "Fiscal 2006 was a challenging year for the industry... A shortage of new hardware coupled with a softness in consumer demand for current generation games dramatically impacted results. In addition, titles such as The Matrix: Path of Neo and Marc Ecko's Getting Up: Contents Under Pressure performed below our expectations."
In reality, the publisher ended the fourth quarter of the 2006 financial year with $15m in cash and $1m of debt – mainly due to the sale of key intellectual properties such as Timeshift and Stuntman 2, and slashing its workforce by 25 percent since February. Unfortunately for the company, its last big title, Driver: Parallel Lines, was released too late to have any impact on the losses, hitting stores just two weeks before the company's year end.
Whilst Atari’s line up for late 2006 and 2007 is currently looking pretty healthy, the long-term future of the once-mighty brand is clearly now in doubt.
Its 2006/07 release schedule includes such key titles as Alone in the Dark (PC, PS3, Xbox 360), Neverwinter Nights 2 (PC), Dragon Ball Z: Budokai Tenkaichi (PS2, Wii), and Test Drive Unlimited (PS2, PC, Xbox 360, PSP).
Atari’s parent company, Infogrames posted a net debt of 173.2 million euros at the end of March.
Let's just hope that Mr Bonnell’s bank manager is in a very good mood when they next do lunch.
This compared to net profits in 2005 of $5.7million. It seems that a combination of poor sales and that old chestnut, ‘the transitional year’ has hit the company hard where it hurts.
The company issued an official statement, which sombrely outlines the situation: "As the year-end results were substantially below the Company's expectations, the uncertainties resulting from the Company's financial condition raise substantial doubt about the Company's ability to continue as a going concern."
Bruno Bonnell, Atari’s Chairman, CEO and Chief Creative Officer added: "Fiscal 2006 was a challenging year for the industry... A shortage of new hardware coupled with a softness in consumer demand for current generation games dramatically impacted results. In addition, titles such as The Matrix: Path of Neo and Marc Ecko's Getting Up: Contents Under Pressure performed below our expectations."
In reality, the publisher ended the fourth quarter of the 2006 financial year with $15m in cash and $1m of debt – mainly due to the sale of key intellectual properties such as Timeshift and Stuntman 2, and slashing its workforce by 25 percent since February. Unfortunately for the company, its last big title, Driver: Parallel Lines, was released too late to have any impact on the losses, hitting stores just two weeks before the company's year end.
Whilst Atari’s line up for late 2006 and 2007 is currently looking pretty healthy, the long-term future of the once-mighty brand is clearly now in doubt.
Its 2006/07 release schedule includes such key titles as Alone in the Dark (PC, PS3, Xbox 360), Neverwinter Nights 2 (PC), Dragon Ball Z: Budokai Tenkaichi (PS2, Wii), and Test Drive Unlimited (PS2, PC, Xbox 360, PSP).
Atari’s parent company, Infogrames posted a net debt of 173.2 million euros at the end of March.
Let's just hope that Mr Bonnell’s bank manager is in a very good mood when they next do lunch.
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Comments
I'll Eat Your Soul 15 Jun 2006 11:21
1/4
I have an innovative idea that just might save the Ataris of the world... STOP. MAKING. 5HIT. GAMES.
The Matrix: Path Of Neo? Driver: Parallel Lines? Mark Ecko: Generic Cynical Exploitation Of Urban Culture In A GTA Clone? Seriously, I know Atari sunk a lot of change into developing these titles, and in the case of The Matrix, that was exacerbated by acquiring the license. None of these games was ever going to set the world on fire.
As much as we despise them for their excessive sequelitis and sheer might, EA titles such as the latest FIFA, the long running Sims franchise and so forth sell because, well, they're not unenjoyable to play.
I'm not going to get into the FIFA vs Winning Eleven nonsense here. I like FIFA, so, shoo.
The Matrix: Path Of Neo? Driver: Parallel Lines? Mark Ecko: Generic Cynical Exploitation Of Urban Culture In A GTA Clone? Seriously, I know Atari sunk a lot of change into developing these titles, and in the case of The Matrix, that was exacerbated by acquiring the license. None of these games was ever going to set the world on fire.
As much as we despise them for their excessive sequelitis and sheer might, EA titles such as the latest FIFA, the long running Sims franchise and so forth sell because, well, they're not unenjoyable to play.
I'm not going to get into the FIFA vs Winning Eleven nonsense here. I like FIFA, so, shoo.
I'll Eat Your Soul 15 Jun 2006 11:21
2/4
I have an innovative idea that just might save the Ataris of the world... STOP. MAKING. 5HIT. GAMES.
The Matrix: Path Of Neo? Driver: Parallel Lines? Mark Ecko: Generic Cynical Exploitation Of Urban Culture In A GTA Clone? Seriously, I know Atari sunk a lot of change into developing these titles, and in the case of The Matrix, that was exacerbated by acquiring the license. None of these games was ever going to set the world on fire.
As much as we despise them for their excessive sequelitis and sheer might, EA titles such as the latest FIFA, the long running Sims franchise and so forth sell because, well, they're not unenjoyable to play.
I'm not going to get into the FIFA vs Winning Eleven nonsense here. I like FIFA, so, shoo.
The Matrix: Path Of Neo? Driver: Parallel Lines? Mark Ecko: Generic Cynical Exploitation Of Urban Culture In A GTA Clone? Seriously, I know Atari sunk a lot of change into developing these titles, and in the case of The Matrix, that was exacerbated by acquiring the license. None of these games was ever going to set the world on fire.
As much as we despise them for their excessive sequelitis and sheer might, EA titles such as the latest FIFA, the long running Sims franchise and so forth sell because, well, they're not unenjoyable to play.
I'm not going to get into the FIFA vs Winning Eleven nonsense here. I like FIFA, so, shoo.
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Moschops 15 Jun 2006 23:06
3/4
Hahahaha.
'Skit', as an old friend of mine would have said
'Skit', as an old friend of mine would have said
config 16 Jun 2006 08:19
4/4
Driver: Parallel Lines wasn't bad at all. It certainly wasn't GTA, but then the aim wasn't be a GTA clone, but rather to go back to root.