Majesco Plummets 6% On Disappointing Results (COOL)
On this day 14 years ago, Sega released its final game console in North America: Dreamcast.
At the time, Majesco (NASDAQ: COOL) was still somewhat of a small player in the industry. The firm was not yet public (that came later through the acquisition of a privately traded shell company). But company execs dreamed of something bigger.
Carl Yankowski, a former Intel (NASDAQ: INTC) and PepsiCo (NYSE: PEP) exec, came aboard early last decade to help the company fulfill its dreams. The goal was to release a series of high-end games -- such as BloodRayne, Advent Rising and Psychonauts -- and become a triple-A publisher overnight.
This was a tall order, particularly for a company that had never attempted to compete with the industry's biggest developers and publishers. Majesco ultimately failed, causing Yankowski to leave the company as it began to crumble.
In the years since that time, Majesco has released a few successful games, including Cooking Mama.
That franchise was unable to soften Majesco's downfall. Over the past five years, Majesco has tumbled more than 35 percent. Year-to-date, the company has lost more than 39 percent of its value.
Today's earnings results are unlikely to help the situation.
The company reported a third-quarter EPS of $(0.08) -- an 11 percent decline from the year-ago period -- versus the Street estimate of $(0.07).
Revenue came in at $4 million, a decline of 56 percent year-over-year. Wall Street expected revenue to hit $8.83 million -- more than twice as much as the company reported.
"Consistent with the first half of 2013, our third quarter results reflect the ongoing industry transition to next generation console gaming," Jesse Sutton, Chief Executive Officer of Majesco Entertainment, said in a company release. "We believe that our holiday release slate, which is focused on high-profile branded games based on popular characters or franchises, is the right approach for the current environment."
Sutton said that Majesco is excited about its upcoming releases, including those based on the Phineas and Ferb, Agent P Doofendash franchises.
Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.
Louis Bedigian is the Senior Tech Analyst and Features Writer of Benzinga. You can reach him at 248-636-1322 or louis(at)benzingapro(dot)com. Follow him @LouisBedigianBZ
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