Atari VCS in Jeopardy After Atari Pull Manufacturing Contracts


There might be rough seas ahead for the Atari VCS retro gaming console — not that the seas behind it were all that great either. While we were initially intrigued when the VCS was first announced, its challenging and controversial development took some of the shine off the device. And after years of delays that meant the hardware was dated by the time it hit store shelves, any excitement regarding the console had definitely diminished when we reviewed the VCS last year. And it seems like we weren’t the only ones underwhelmed.

According to Atari’s half-year earnings report for fiscal 2022/2023, the future for the VCS looks bleak. Overall, the company reported revenue of $4.65 million, which was a 27 percent decrease from the same period last year. More importantly, hardware revenue plummeted 92 percent year-over-year, from $2.44 million to just $212,466. Atari attributed the decline to “[reduced] cartridge activity and underperformance by the VCS.” In other words, consumers appear to have turned their backs on the console.

Atari is reorganizing its hardware business and critically says this “includes the suspension of direct hardware manufacturing relationships” relating to the VCS. However, Atari did not mention any plans to secure new contracts to manufacture the VCS, so this appears to be the end of the line for the troubled console.

(Image credit: Future)

Going forward, Atari is implementing a new commercial strategy that involves the development of “new hardware complementary to the Atari VCS with partners under licensing contracts.” This doesn’t sound like a revised or next-generation VCS console, but perhaps new accessories for the system. The company already offers a Classic Joystick and Modern Controller for the VCS. However, it’s somewhat confounding that the company would shift resources to creating new accessories for a console that customers seemingly have not embraced in any large capacity.



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