In the second quarter, Midway ( MWY) slashed its net loss and boosted its revenue. The video game-software maker also projected that it would post a profit in the fourth quarter, which would be its first quarter in the black since 1999.

But the company missed Wall Street's earnings estimates for the just-completed quarter and provided earnings guidance for the third quarter that are far below analysts' consensus.

At least initially, investors chose to see the positive. In after-hours exchanges Wednesday, its stock was recently up 4 cents, or 0.4%, to $11.10. The company's stock closed regular trading off 49 cents, or 4.2%, to $11.06.

Midway lost $10.69 million, or 16 cents a share, on $47.29 million in sales in the second quarter. That compared favorably with the year-ago period, when the company lost $55.67 million, or $1.20 a share, on just $4.98 million in sales.

But analysts polled by Thomson First Call were hoping for even more improvement on the bottom line. The consensus estimates was for a loss of 11 cents a share on sales of $42.12 million.

Meanwhile, the company also offered third-quarter guidance that was much worse than analysts' forecasts. Midway expects to lose about $20 million -- about 25 cents a share, if the company's share count remains unchanged -- on just $12 million in sales in the current period. Wall Street had predicted a loss of 7 cents a share on sales of about $26.4 million.

For the full year, Midway expects to lose about $20 million -- again, about 25 cents a share at the current share count -- on sales of about $157 million. Analysts were looking for a loss of 26 cents a share on sales of about $157.81 million.

Midway plans to release two titles in the fourth quarter: Mortal Kombat: Deception, the latest title in its Mortal Kombat franchise, and Midway Arcade Treasures 2. The company announced that it is delaying the release of Area 51, originally slated for later this year, until next year.

The video game maker has been going through a transition of late. Viacom Chairman Sumner Redstone has been buying up Midway's stock and now owns more than 85% of the company on a beneficial basis. Last month, two of Redstone's nominees to Midway's board were elected the chairman and vice chairman of the company.