Publisher and accessory manufacturer Mad Catz has announced plans to layoff 37 percent of staff in light of lowly sales of Rock Band hardware.
News of redundancies only adds to an already testing week for the company, which confirmed only yesterday that its chairman, CEO and general counsel have now all resigned. Such losses have spurred a restricting effort for Mad Catz, however it’s an overhaul the will lead to cutting more than a third of its workforce.
Karen McGinnis, President and Chief Executive Officer at the company, noted that Rock Band sell-through numbers missed internal expectations.
Our quarterly net sales were the second highest in the company’s history reflecting strong Rock Band 4 sales, which were partially offset by continuing softness in sales of our audio and PC gaming products. However, Rock Band sell-through was lower than originally forecast resulting in higher inventory balances as well as lower margins due to increased promotional activity with retailers.
Mad Catz recorded a major financial haul in its third-quarter reports to the tune of $65 million, though during that same period net income dipped 10 percent to $1.2 million, and those losses have only ballooned to $4.4 million.
Looking ahead, the company is “focused on lowering operating costs, increasing efficiencies and better aligning its workforce with the needs of the business,” which is designed to reduce losses by the end of financial year 2016.
Rock Band 4 may have under-performed, but the imminent launch of Street Fighter V will provide a welcome boon in sales figures for Mad Catz accessories. Nevertheless, our thoughts go out to those affected by the planned layoffs.