Tuesday, March 13, 2012

Majesco (Nasdaq: COOL) shares fall on weak forecast

Majesco (Nasdaq: COOL) shares fall on weak forecastAustin, TX 3/13/12 (StreetBeat) -- Shares of Majesco Entertainment Co (Nasdaq:COOL) fell as much as 13 percent on Tuesday, after the video game publisher posted a lower-than-expected quarterly profit and forecast 2012 largely below estimates.

The company forecast 2012 adjusted earnings of 25 cents to 35 cents per share on revenue of $130 million to $140 million.

Analysts, on average, were expecting earnings of 35 cents per share on revenue of $136.5 million, according to Thomson Reuters I/B/E/S.
For the first quarter, gross margins fell to 35 percent from 41 percent a year ago on lower margins on non-Zumba related titles and higher promotion costs around the holiday selling season.

Seventy percent of the company's revenue comes from its best-selling Zumba titles.

Majesco's revenue for the quarter, however, came in above market expectations.

The revenue beat, helped by the Zumba franchise and international growth, was offset by higher-than-expected software development costs, sales and marketing spending, Wedbush Securities analyst Michael Pachter wrote in a note.

Shares of the company were down at $2.57 in morning trading on the Nasdaq.

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