Increased licensing revenues from the successful debut of the TMNT movie in March and the recognition of the 2007 minimum guarantee from the toy license for the Cabbage Patch Kids were not enough to overcome the continuing decline in revenue from 4Kids Entertaiment's mature properties, Yu-Gi-Oh! and Winx Club as Q1 net revenues for the children's entertainment powerhouse fell from $19.3 million in 2006 to $14.9 million this year. 

The company suffered a $200,000 loss compared with a net income of $1.5 million in the first quarter of 2006.  Still 4Kids' performance marked an improvement over the 4th quarter of 2006 when the company lost $2.3 million (see 'Yu-Gi-Oh! TMNT Hit 4Kids Bottom Line').

4Kids Chairman and CEO Alfred R. Kahn pointed out that expenses for the quarter were down in spite of start-up costs for TC Digital Games, 4Kids new TCG manufacturing arm. 

4Kids is pinning its hopes on the Chaotic TCG, which is releasing to comic and hobby stores in June, 90 days before it hits the mass market (see 'Hobby to Get 90 Days on Chaotic').  Kahn also noted that 4Kids will be in position to benefit greatly if the Chaotic game is a hit because: 'Unlike previous trading card properties that we represented as a licensing agent, Chaotic cards will be produced by TC Digital Games and, therefore, we will receive a higher percentage of revenue from Chaotic card sales.'

But the Chaotic TCG is not the only egg in 4Kids' basket.  Kahn told industry analysts that 4Kids would soon announce several new animated series that will be part of the 4Kids block on the Fox network and could potentially boost ratings and sales for the animated block that airs on Saturday mornings.