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THQ swings to $15m loss with cancelled projects

Company of Heroes Online, WWE Online cancelled at cost of $10m, $30m impairment from movie games

Red Faction publisher THQ has recorded a loss of $14.9 million (9.2m) for the third quarter ended December 31, 2010, compared to a profit of $542,000 for the same period last year.

Sales were also down to $314.6 million (194m) compared to $356.7 million for the previous year's quarter.

The publisher has cancelled the planned Company of Heroes Online and WWE Online games - Western content to be turned into free-to-play games for Asian markets - at a cost of $9.9 million.

It has also "re-evaluated" sales of kids games based on movie licenses, resulting in a $30.3 million impairment on movie tie-ins for games that have not been released yet.

During the quarter the publisher shipped 1.2 million uDraw game tablets, with an international release due in March. It also shipped 2.7 million units of WWE Smackdown vs Raw 2011.

"THQ is poised for significant net sales and earnings growth in fiscal 2012 as a result of aggressive investment in owned intellectual properties and major franchises, a lean cost structure, and growing digital revenues," said CEO Brian Farrell.

"Fiscal 2012 will be driven by the strongest core games line-up in our history, including: Red Faction Armageddon, Warhammer 40,000 Space Marine, MX vs ATV Alive and the newest instalment of our Saints Row franchise."

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Latest comments (4)

It's a damn shame to see CoH Online cancelled apart from the 9.9 Million going down the drain.
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Rob Craig Instructor / Writer 5 years ago
I suppose that's the problem with a conglomerate like this ... so many irons in the fire. Volition is another story. Strong focus on franchises ... Red Faction & Saints Row. With a good studio like Volition, I hate to hear about too much restructuring with THQ as sometimes the bread-winners get unfairly downsized to spread the cost-cutting. Hope this isn't happening there.
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Terence Gage Freelance writer 5 years ago
THQ have been saying for a while that they're going to focus more on in-house products and put less onus on licensed properties, which I think is a sensible long term goal. Perhaps the transition itself isn't going as smoothly as they'd like, but I expect once titles like Homefront and uDraw are a bit more established they'll soon be back in the black.

Good luck to them, and I think they have the right idea for the company's long-term goals.
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Steven Pick Lead Graphic Designer, Atomhawk Design5 years ago
Really hope THQ don't "do a Midway". Good luck to all involved.
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