THQ Blows Earnings, Laying Off 250 (THQI)

We knew THQ’s (THQI) Wall-E video game was bad, but not this bad: In reporting earnings today, the company blames Wall-E’s lackluster sales, the rising strength of the dollar, and higher-than-expected returns for missing its guidance.

The company posted $165 million in revenue, in line with consensus but down from $229 million last year. But the company showed a non-GAAP loss of $0.46, versus an expected loss of $0.38.

The company’s plan going forwards: Lay off 17% of its staff, about 250 workers (five studios are already closed), cancel a few games still in production, and shift its focus to fewer, higher-quality titles.

THQ’s stock was down 20% to 5.25 in after-hours trading, partially due to terrible guidance. AP:

THQ expects a profit of 5 cents to 15 cents per share for its fiscal third quarter ending Dec. 31. Analysts polled by Thomson Reuters expect a profit of $1.09 per share in the third quarter. …

The company also cut its full-year revenue estimate to a range of $875 million to $900 million from a prior outlook of $1.14 billion to $1.18 billion. Analysts expect full-year revenue of $1.12 billion.

THQ expects sales to range from $400 million to $420 million in the third quarter. Analysts expect third-quarter revenue of $566.4 million.

See Also:
Wall-E: Box Office Gold, Lackluster Video Game
THQ Closes Five Studios, Lays Off More

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