MicroProse to scale back operations, lay off up to 40

March 13, 1993|By Kim Clark | Kim Clark,Staff Writer

MicroProse Inc., a Hunt Valley-based maker of computer games, announced yesterday that it was restructuring, reducing its operations in new sectors such as fantasy games and laying off up to 40 people.

The move will reduce its fourth-quarter earnings by $400,000, but will cut $2.5 million from its expenses in the next fiscal year, which begins April 1, said Vice President Gerard Blair.

Mr. Blair said the company, which has about 400 employees worldwide, would reduce its staff by about 10 percent to concentrate on the kinds of games for which it is best known, such as flight simulators, sports games and military battle games.

In addition, the restructuring will emphasize the company's evolution from games made on floppy disks for personal computers to games made on Nintendo and Sega cartridges.

The company made the announcement yesterday after the markets closed. MicroProse stock ended down 37.5 cents, at $7.75 a share.

The move comes one month after the company announced the departure of its president and its chief financial officer.

About that time, investors also complained that delays in deliveries to stores of promised games were hurting profits. Late last year, the company had said its most recent flight simulation game, "F-15 Strike Eagle III," wasn't shipped until Dec. 15 -- too late to take advantage of the Christmas rush.

As a result of the delays, the company's earnings fell to $893,000 in the three months that ended Dec. 31, a 61 percent decline from the same quarter a year earlier.

For the nine months that ended Dec. 31, the company earned $771,000, down from $3.2 million the year before.

Rod Atamanian, a computer game industry analyst for Volpe, Wiltey & Co., a San Francisco investment bank, said MicroProse was suffering from some of the same problems affecting the entire industry.

Competition in computer games has skyrocketed, eating into the shelf space of industry stalwarts, including some of MicroProse's products, he said.

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.