Jesse Sutton, Chief Executive Officer of Majesco Entertainment, said, “We continue to execute on our mass market, family-friendly strategy and build on our presence in one of the industry’s fastest growing genres. Our second quarter results are in line with our expectations and reflect the impact of our release schedule and seasonality of our business. For the first six months of 2008, our combined DS and Wii business, which is at the core of our mass market strategy, is up roughly 50% versus last year. We remain on pace to achieve modest gross margin gains in 2008 and continue to believe that we can achieve cash break even or better at an operating level with full fiscal year net revenue between $53 and $58 million.

“We launched six new titles in the second quarter and 10 titles year to date. Two titles shipped for Nintendo’s Wii system, seven for Nintendo’s DS handheld, and one title for the PSP(R) (PlayStation(R)Portable), aimed to maintain our focus on the family-friendly market,” continued Sutton. “We are prudently expanding our portfolio of titles and our studio is on schedule in developing its first titles. With our targeted strategy, improved operating execution and commitment to cost controls we are well positioned to continue improving our financial performance.”

Generally Accepted Accounting Principles (GAAP) and Non-GAAP Metrics

To facilitate a comparison between the three and six months ended April 30, 2008 and 2007, the Company has presented both GAAP and non-GAAP financial results. GAAP financial measures, including operating income, net income, and basic and diluted earnings/loss per share, have been adjusted to report non-GAAP financial measures which exclude gains on the increase in the value of common stock to be issued in settlement of the class action litigation and related charges, net, and the change in the fair value of warrants issued in connection with our September 2007 equity financing. These non-GAAP measures are provided to enhance investors’ overall understanding of the Company’s current financial performance and the Company’s prospects for the future. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to GAAP results.

In the fiscal year ended October 31, 2007, the Company recorded a $2.8 million charge in connection with the expected settlement of class action litigation. The charge was comprised of $2.5 million, representing the fair value, on the date the agreement was executed, of the common stock expected to be distributed when the settlement becomes effective and $0.3 million representing the increase in the value of the shares from that date through October 31, 2007.

The Company will adjust the fair value of the liability to the fair value of the shares expected to be distributed at each balance sheet date and record the resulting change as a non-cash charge, or gain, to earnings in each period until the shares are distributed. Due to fluctuations in the Company’s stock price, this resulted in a non-cash gain of $0.3 million during the six months ended April 30, 2008. The settlement provides that if the fair value of the stock falls below $2.5 million, the Company will issue additional shares, subject to certain limitations, with a fair market value equal to the amount of the decrease. Therefore, the liability will not be adjusted below $2.5 million.

Net revenue for the fourth quarter ended March 31, 2008, was $15.3 million versus $26.9 million in the comparable year-earlier period. Publishing net revenue was $13.5 million, versus $25.8 million in the prior year, while distribution revenue was $1.8 million, versus $1.1 million in the comparable year-earlier period.

Net loss for the fourth quarter ended March 31, 2008 was $3.7 million, or $0.27 loss per share, compared to net loss of $61.7 million, or $4.58 loss per share, in the year-earlier period. Without restructuring charges, the net loss for the fourth quarter ended March 31, 2008 would have been a loss of $1.8 million or $0.13 loss per share.

Net revenue for the year-ended March 31, 2008, was $80.1 million versus $122.3 million in the comparable year-earlier period. Publishing net revenue was $69.8 million, versus $104.7 million in the prior year, while distribution revenue was $10.3 million, versus $17.6 million in the comparable year-earlier period.

Net loss for the year-ended March 31, 2008 was $23.6 million, or $1.75 loss per share, compared to net loss of $69.7 million, or $5.17 loss per share, for fiscal 2007. Without restructuring charges, the net loss for the year-ended March 31, 2008 would have been a loss of $17.1 million or $1.27 loss per share.

Shane Kim will assume the role of corporate vice president of Strategy and Business Development, a newly established role in Microsoft’s Interactive Entertainment Business. In addition, Phil Spencer, a Microsoft Game Studios veteran for six years, will assume leadership of all first-party development and publishing efforts worldwide. Both leaders will report directly to Don Mattrick, senior vice president of the Interactive Entertainment Business.

After spending four and a half years leading the transformation of Microsoft Game Studios into a world-class entertainment publisher, Kim will now explore new growth opportunities with partners across all parts of the global Interactive Entertainment Business. His focus will be on future external relationships and partnerships, as well as developing growth strategies for the entire business.

Formerly the general manager of Microsoft Game Studios Europe, Spencer will return to Redmond from the U.K.to take on his new role as general manager of the global Microsoft Game Studios business. Spencer will oversee the creation of new, unannounced franchises that aim to attract new audiences. His teams will foster some of today’s most beloved entertainment franchises, including “Halo,” “Gears of War” and “Fable,” by continuing to partner with the industry’s best developers to deliver the best games for the Windows and Xbox platforms.

“We’re strategically positioning the leadership team to drive every aspect of the Xbox business to new heights,” Mattrick said. “I firmly believe that Microsoft will lead the next great innovations in games and entertainment. Today’s organizational announcements align us to accelerate this expansive growth.”

After two years of driving a cultural change in the way Microsoft markets its entertainment brands, Jeff Bell, current corporate vice president of Global Marketing for Microsoft’s Interactive Entertainment Business, has decided to pursue other opportunities outside Microsoft. Bell will remain at Microsoft through the summer, working with Mattrick to ensure a smooth transition of his responsibilities. In the interim while Microsoft searches for Bell’s replacement, Matt Barlow, Charlotte Stuyvenberg and Jim Merrick, all day-to-day product marketing and marketing communications leaders in the Interactive Entertainment Business, will carry forward global marketing initiatives for the business group.

“The time is right for me to pursue my life’s passion of consumer brand marketing and the creative and services that drive it.” Bell said “Coming from automotive, and now technology and entertainment, I am excited to expand to new industries and categories.”