SouthPeak Interactive has released their financial results for the first quarter of fiscal year 2011, ended on September 30, 2010. The company’s net revenue dropped to $1.4 million, down from $16.7 million in the first quarter of fiscal year 2010. SouthPeak reported a net loss of $1.2 million, versus a net income of $0.7 million during the same period last year.
“Our sales for the period were largely impacted by our ongoing legal proceedings with Nobilis which caused us not to release any new titles for the quarter or remanufacture our catalogue of titles under this contract,” said Southpeak CEO Melanie Mroz. “I’m pleased to report that in October we received a summary judgment granting us the right to resume production of My Baby First Steps and reinstate the contract with Nobilis, which includes the rights for My Baby sequels, catalogue titles and 14 additional games.”
“We have since resumed manufacturing titles under this contract in order to address the remainder of the holiday selling season. We are hopeful that the summary judgment will be upheld at the final ruling scheduled for December 2.”
Heading into the next quarter and the rest of the year, SouthPeak is enthusiastic about new growth markets like smartphone and tablet gaming.
“Our digital strategy and entering other existing high growth markets where we can gain immediate traction remain a core focus for propelling our growth in fiscal 2011. We are particularly excited about our strategic partnership with NVIDIA to bring games to their new phones and tablets. NVIDIA’s new Droid platform technology is a significant step forward in our strategy to broaden our digital offerings,” Mroz said.
Future titles include Two Worlds II, Stronghold 3, and a new 'edutainment' game. The company also recently launched its first game for the PlayStation Move, Get Fit With Mel B.
“We have now shipped our first title for the next generation PlayStation Move platform, Get Fit with Mel B, which we expect to be a top contributor to our future sales,” Mroz explained. “The bulk of our marketing costs for the [first quarter] were associated with costs for promoting our sequel titles for Two Worlds II and preliminary public relations activities for Stronghold 3. Given the success of earlier installments of both games we expect these releases to gain even more robust market penetration.”
“Also in November, we announced the release of our title Tap and Teach: The Story of Noah’s Ark. This marks our first title to address the interactive educational gaming sector, another area where we believe we can grow our business with new games that complement and expand our extensive portfolio,” Mroz concluded.
