Eidos Reports Lower-Than-Expected Sales of Tomb Raider: Underworld Leading to a Potentially Precarious Position

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EidosEidos (formerly SCi Entertainment) announced that while Tomb Raider: Underworld has sold approximately 1.5 million copies, the company had expected higher sales and is revising its expected revenue estimates. Essentially, Eidos is concerned that retailers will discount the game, it will make less money.
Eidos is also concerned that lower profits may make its financial position precarious. As Eidos puts it, "We have passed our peak net debt position and we retain sufficient headroom within our committed banking facility but given revised profit expectations we may need to enter into discussions with our lending bank regarding our June 2009 covenants." In other words, Eidos won't have as much money as it expected, so while the company has a little breathing room, it may have to go back to creditors or risk future problems.

As a result of the announcement, Eidos' stock can be expected to fall significantly.

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This page contains a single entry by Editor published on January 9, 2009 5:40 AM.

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