Acclaim Entertainment gave its investors some bad news Friday, warning that it will post an unexpected loss in its second quarter and in fiscal 2000.
Acclaim (Nasdaq: AKLM) shares were unchanged at 4 7/8 following the announcement, indicating that either investors have already lost faith in the software games developer or no one's really paying attention.
The stock peaked at 9 5/16 in April before falling to a low of 3 in January.
Company officials said a slowdown in hardware console sales and its strategy of emphasizing Nintendo software hurt the company this quarter.
Also, it increased its research and development spending 35 percent this year.
"The combination of these factors are anticipated to result in a loss for the quarter of approximately $20 million, and for the year, net revenues are forecast to be approximately 30 percent below fiscal 1999 net revenues resulting in a net loss of approximately $50 million," the company said in a prepared release.
First Call consensus was expecting Acclaim to earn 2 cents a share in its second quarter and 12 cents a share in the fiscal year.
"Our industry is in the midst of a major transition, as manufacturers, retailers and game players await the next generation of powerful new video game consoles," said CEO Gregory Fischbach in a prepared release. "Product demand has declined in our first two fiscal quarters, and we do not expect a rebound until the fall, when Sony releases its Playstation 2 console."
Three of the five analysts tracking the stock maintain a "hold" recommendation.