Atari Corporation

After the downfall of Atari, the consumer hardware division was sold to Commodore founder Jack Tramiel and renamed to Atari Corporation. After the takeover, the unprofitable company was hit with large layoffs, cancellation of projects and closure of most branches.

Atari initally focused on the development of home computers, releasing an updated Atari 8-bit machine called the Atari XE as well as the 16-bit Atari ST in 1985. The ST was Atari's most successful product, being especially popular in Europe, as well as in the music industry due to the built-in MIDI ports.

Video games were at first only a side business, with leftover inventory being sold to support the home computer development. The first new release was the Atari 7800, which had already been designed in 1983. It was marketed as a budget alternative to the NES. It was backwards compatible with the 2600, but only received limited support from Atari.

In 1989, they released the handheld Atari Lynx. While the Lynx was technically superior to the Nintendo Game Boy, it suffered from supply shortages and a small game library.

At the beginning of the 1990s, Atari's home computer business was in decline, being unable to compete against IBM-compatible PCs. They fully shifted their focus to video games and began development of a new console that would become the Atari Jaguar, released in 1993. The Jaguar was a powerful system for its time and the marketing emphasized its supposed "64-bit" capabilities. In fact, the Jaguar's architecture was very complex, making it hard to develop for. It suffered once more from insufficient developer support, both by Atari and third parties. The Jaguar turned out to be a major commercial failure that ultimately spelled the end for Atari.

The Tramiel family merged the company with the hard drive maker JTS in 1996, effectively shutting down operations. The Atari brand and IP rights were later sold to Hasbro Interactive, where they would be held by Atari Interactive.