Midway path leads to loss

Publisher's revenue fell 10% to $69.8 million

Sumner Redstone-owned Midway Games swung to a loss in the fourth quarter amid a general industry slump that also hit most competitors.

Midsized publisher’s revenue fell 10% to $69.8 million, while it swung to a $37.8 million loss, including a $10.8 million charge related to a restructuring that included layoffs, from a $17.6 million profit a year earlier.

Unlicensed football game “Blitz: The League” sold well in the quarter, but several other releases, including racing game “L.A. Rush,” which MTV helped promote as part of a cross-marketing deal, apparently didn’t do too well, as Midway didn’t tout sales.

As part of the MTV deal, Midway recently pacted with Paramount to develop concurrently the film and game “The Wheelman,” to star Vin Diesel (Daily Variety, Feb. 22).

For 2006, Midway is expecting to cut its net loss nearly in half to $66 million, while revenue is expected to grow only 3% to $155 million.

After closing at $10.87, Midway shares were down 8% in after-hours trading, following the earnings announcement.

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