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Rock Band 4 Continues To Hang Around Mad Catz’s Neck In Red Ink Heavy First Quarter
Rock Band 4 continues to take a toll on peripheral manufacturer Mad Catz. The company’s sales slumped once more, with net loss growing year-over-year.
Sales decreased 17 percent to $10.8 million as losses grew 21 percent. The company finds itself in the red $4.8 million.
This quarter sees another $2.7 million in charges related to the failed deal with Harmonix that saw the ouster of top executives in February. The two companies continue to dispute the performance of the hardware at retail.
The ripple effect of Rock Band 4 is a continued pinch on Mad Catz’s working capital that limits its ability to seize opportunities that require significant outlay. Mad Catz must sell the remaining $7 million in inventory it's holding by September 6.
Mad Catz laid off 40 percent of its staff earlier this year in order to right the ship. Company executives maintain that the reorganization has left the firm in a more nimble position, though much more work is left to be done.
Our Take
Mad Catz continues to struggle, and its unclear just how it’s going to recover from the bad bet on Rock Band 4. While executives are hopeful, evidence in the first quarter shows a backslide.
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