Question

Atari Shares Fall 40% on Unexpected Loss; Company's Future in Question

Authored by Mark Hefflinger on February 10, 2006 - 3:06am.

New York - Shares of video game publisher Atari, a unit of France-based Infogrames, fell more than 40% on Thursday after the company reported an unexpected loss of $4.8 million during its fiscal third quarter ended Dec. 31. The loss of 4 cents per share is compared with income of $19.6 million, or 16 cents per share, in the same period a year earlier, and was far short of analysts' expectations of a 17 cents per share profit for the quarter. Atari's revenue for the period, which included the crucial holiday shopping period, was $100.8 million, down 36% from the same time last year -- which the company attributed to fewer releases and weak sales. In its quarterly filing, Atari raised "substantial" doubt as to its ability to continue operating as a viable company. Parent company Infogrames also saw its shares fall nearly 19% on the news.