4Kids Entertainment released its first quarter financials and reported a net loss of $6.4 million compared with a loss of $.2 million for the first quarter of 2007. Part of the reason for the larger losses in Q1 2008 was the year-over-year increase of $3.6 million in selling, general and administrative costs associated with the company’s Chaotic Trading Card Game and its related Websites. Other factors include conditions in the market for auction rate securities, and decreased licensing revenues from some of the company’s more established properties such as Yu-Gi-Oh!.
On the positive side 4Kids reported first quarter sales of $2.4 million worth of Chaotic cards, which were rolled out to major retailers across the
4Kids Entertainment’s Chairman and CEO Alfred R. Kahn, who is clearly expecting the investment in the Chaotic TCG to pay off soon, noted: “We believe that the development initiatives undertaken over the last several quarters will be a main growth driver for the next several years.”
4Kids will certainly have plenty of TV platforms from which to launch and sustain its initiatives—in addition to its 4-hour Saturday morning block on Fox TV stations, in the fall 4Kids will begin programming a 5-hour block on the CW network (see "4Kids Takes Over Kids WB"), which according to Kahn, “provides us with a more favorable cost structure than our agreement with Fox.” Look for announcements concerning 4Kids’ programming initiatives during the New York Licensing Show in June.
