GameSpot Owner Sees Lowered Forecast On Console Transition

Media company CNET Networks, owner of video game-related consumer websites GameSpot.com, GameFAQs.com, and Metacritic, as well as other major properties including CNET News and MP3.com, announced its first-quarter results for the period ending March 31, 2006, posting a net loss of $1.1 million. This small loss was in line with CNET's prior outlook, and compared a little poorly to a profit of $383,000 over the same period a year prior. Revenue for the period increased by 17 percent to $83.4 million, just below analysts' expectations of $85.7 million, but the notable news was that the company's revenue forecast for the rest of the year was revised down, with the PlayStation 3's delay and console hardware transition specifically cited as a reason for this slowness. CNET stated that it expects profits for the second quarter ending in June to fall between $900,000 to $4.4 million, with overall revenue between $88.5 million to $92 million, and referenced delays in technologies such as the Windows Vista OS and Sony's PlayStation 3 as key contributors to the decline in expected revenue, particularly with regards to revenue derived from advertisements. "Though we have gone a long way in broadening our customer base in expanding our business, there are important transitions occurring simultaneously in the PC and video game industries this year that are impacting us," commented chairman and chief executive Shelby Bonnie to investors on a conference call reported by Reuters. The company also revised its 2006 revenue forecast, lowering it to between $386 million and $403 million, which represents a growth of 15 to 20 percent, as compared to the 17 to 21 percent previously forecast.