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Atari Tilts on Guidance

Sales jump, and the company's net loss decreases, but the forecast for next quarter disappoints.

Atari

(ATAR)

slashed its net loss, besting the Street's estimates, but offered a disappointing outlook for the holidays.

For its fiscal second quarter, the video-game software publisher reported Thursday that it lost $16.89 million, or 14 cents a share. That was an improvement on the year-ago period, when the company lost $68.08 million, or 90 cents a share, after a $39.35 million, or 52 cents a share, dividend to parent company Infogrames Entertainment.

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Atari's sales jumped 17.9% to $71.39 million.

Those results were better than expected. Analysts polled by Thomson First Call forecast that the company would lose 19 cents a share in the quarter on $70.18 million in sales. In July, Atari predicted it would lose $19 million, or 16 cents a share, on revenue of $75 million in its second quarter.

But for the second quarter in a row, the company offered worse-than-expected guidance. For its fiscal third quarter, Atari expects to earn $15 million to $20 million, or 12 cents to 17 cents a share, on sales ranging from $160 million to $175 million. Wall Street had predicted profits of 24 cents a share on $189.11 million for the current quarter.

Atari's report came after the bell. The company's stock closed regular trading up 7 cents, or 4.1%, to $1.80; after hours, shares were recently up 3 cents, or 1.7%, to $1.83.