THQ Loses Money, Focuses On Future

THQ, publishers of the UFC: Undisputed and Red Faction franchises, has reported a loss of $47m for Q2 of their fiscal year, on sales of $77.1m. Those numbers from the same period in FY 09 were losses of $5.6m and sales of $101.3m, respectively.

Despite the numbers, THQ said the numbers were within their guidance. CEO Brian Farrell had this to say:

“We continue to invest in our long-term product pipeline, with the recent eight-year extension of our UFC relationship, and the planned addition of Patrice Desilets to our growing team of talented artists creating new intellectual properties for THQ… Our goal this fiscal year continues to be to position THQ for significant growth in fiscal 2012 and beyond…”

It’s FY 12 where THQ’s biggest names will drop, including Red Faction: Armageddon, Warhammer 40,000: Space Marine and what is commonly being referred to as Saints Row 3.

I’m a little sceptical of THQ’s long term strategy. In the meantime, the company is hopeful that sales of Kinect hold to Microsoft’s recently announcedprojections. The company has three games for Kinect in development: Fantastic Pets, The Biggest Loser Ultimate Workout and UFC Trainer.

I’m personally a little sceptical of this approach. What THQ is saying is that they’re going to ride yearly franchises – one of which is no longer yearly – and casual games on a system that will have absolutely no shortage of casual games for a full year, where they are all but admitting that they will lose money. Essentially, this is THQ admitting that they’re putting all of their eggs into a few baskets. This is what they did for the first two quarters of FY 10, and so far, the results are clear: sales are down $24.2m between Q1 and Q2, and the only thing really holding up Q3 is going to be Smackdown vs. Raw ’11 and a few casual games on an unproven system loaded with similar games.

CORRECTION: I mistakenly listed Assassin’s Creed as a THQ game. This has been fixed. I apologize; I can’t believe I buggered that one up.

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