Xbox 360 retreat hits game publishers' stocks

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Shares of video game publishers THQ Inc., Take-Two Interactive Software Inc., Activision Inc. and Electronic Arts Inc. were down Friday, after Microsoft Corp. cut its Xbox 360 shipping target for its fiscal year ending June 30.

 Microsoft executives said Thursday that due to unsold inventories in stores, they expect to ship a total of 12 million Xbox 360s by the end of the fiscal year in June, down from their previous target of 13 million to 15 million.

 "Video game publishers will be under pressure today after Microsoft cut its life-to-date shipment. ... There is investor concern about a re-set of expectations around both the Xbox 360 and the Sony PlayStation 3," American Technology Research analyst Paul-Jon McNealy said in a client note.

Shares of video game publishers THQ Inc., Take-Two Interactive Software Inc., Activision Inc. and Electronic Arts Inc. were down Friday, after Microsoft Corp. cut its Xbox 360 shipping target for its fiscal year ending June 30.

 THQ was the hardest hit, with shares falling 3%, or 97 cents, to $30.76, while Take-Two dropped 30 cents, or 1.7%, to $16.94, both on Nasdaq.

 Electronic Arts the world's biggest video game publisher, was down 1.3% to $48.22, and Activision's stock was off 1.75%, or 30 cents, to $16.82, both on Nasdaq.

 On Thursday, Activision said third-quarter revenue and earnings would beat Wall Street estimates, but those results for the fourth quarter ending in March would miss analysts' targets.

 It cited the delay of PC title "Enemy Territory: Quake Wars" and expenses related to an ongoing internal review of its stock option practices dating back to 1992.

 Activision's option grant practices are also the target of an informal   Securities and Exchange Commission inquiry.

Sony is scheduled to issue its financial report Tuesday and is expected to give details about PS3 results.
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