Casualties in battle of Midway
Shares drop to historic low of 43 cents as Q3 losses more than doubleMidway Games stock plunged 23% to an all-time low of 43 cents a share on Monday, the first trading day after Shari Redstone resigned as chairman of the board. Three years ago, shares traded for more than $21 apiece.
After the closing bell Monday, the news wasn't much better. The video game maker reported a third-quarter net loss of $75.9 million, up from a loss a year ago of $33.5 million. Revenue rose 40% to $51.4 million.
Midway president and CEO Max Booty tried to put a happy face on the results, which missed Wall Street's expectations, stressing cost-cutting measures and the abandonment of unsuccessful games.
He also reminded investors of three well-received releases during the quarter: "Unreal Tournament III," "Mortal Kombat: Kollection" and "TNA Impact!" And he noted "the upcoming launch of 'Mortal Kombat vs. DC Universe,' which aligns our company with the exceptional Warner Bros. brand of DC Comics."
Last week, Redstone, daughter of Viacom and CBS executive chairman Sumner Redstone, resigned as Midway chairman and was replaced with movie exhibition expert Peter Brown.
Brown is chairman and CEO of AMC Entertainment and a board member at MovieTickets.com and National CineMedia.
Redstone said she resigned so she can focus on her family's holding company, National Amusements, and the financing efforts there that came to light when her father was forced to sell $230 million of Viacom and CBS shares to fund National Amusement debt. (partialdiff)