Mad Catz sees 31% drop in Q2 sales, $480K net loss
CEO recognises "weakness in video game products"
Mad Catz, the gaming peripheral manufacturer, has seen a significant fall in revenues for Q2 and a net loss of $480K, but continues plans to move into software.
The company saw a 31 per cent drop in revenues for Q2, compared with 2010, with a fall from $37.4 million to $25.8 million.
Gross profits for the same period also fell by 29 per cent to $7.4 million while operating expenses rose by 5 per cent to $9 million.
The company statement suggested that the sales of Rock Band 3 accessories in the prior year quarter were responsible for the decline.
"While we are disappointed with the sales in the second quarter when compared with sales from last year's second quarter, we should keep in mind that sales for the quarter were on par with the second highest sales for the second quarter in Mad Catz' history," said CEO Darren Richardson.
"Although we improved sales of our increasingly important audio and PC products, these gains were more than offset by weakness in our video game products, as the revenue from Rock Band 3 product sales fell sharply."
In the earnings call Richardson pointed to plans for the future, including deals with Microsoft to produce Tritton headsets for the Xbox 360, Gears Of War branded accessories and the formation of ThunderHawk Studios, which will develop flight simulation titles.
"I think any areas that we're looking at on game development we're trying to identify niches where we have some core competent," said Richardson during the investors Q&A.
"Core competence could come from the fact we're the leader on the hardware side and also the fact that we have a long solid track record of negotiating and executing great license agreements with all sorts of household name properties from all of the big companies in the interactive entertainment industry and the entertainment industry at large."
"At no point do we intend to look at doing huge budget products that compete with the big tier 1 publishers."