24% of THQ staff cut after $192 million Q3 loss

More than 600 workers pink-slipped after 30% revenue decline; Saints Row 2 ships more than 2.6 million, WWE SmackDown vs. Raw 2009 tops 4 million.

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Anyone hoping that the Bataan Death March of gloomy game-publisher earning reports would end soon saw their prayers go unheeded this week. The day after Electronic Arts reported a $641 million loss for the quarter ended December 31, 2008, THQ turned in its financial numbers for the same period.

The three months saw the Saints Row 2 publisher suffer a net loss of $191.8 million ($2.86 per share), way down from the $15.5 million profit ($0.23 cents per share) that it reported during the same period in 2007. Overall, THQ's October-December revenue fell 30 percent year-on-year from $509.6 million (2007) to $357.3 million (2008).

As a result of its financial shortfall, THQ plans to lay off 24 percent of its worldwide workforce, or 600 people. The announcement comes three months after THQ closed five internal studios and streamlined another two. Just 10 days later, it announced that it was trimming back its release schedule to just one or two games for the hardcore market each year.

"We delivered high-quality games to market this holiday season, but fell short of our revenue and profit targets in this challenging environment," said Farrell in a statement. "We are taking highly targeted actions with the objective of investing in games with the highest franchise potential and returning to profitability. We have executed on our previously announced plan to reduce our cost structure by $120 million. Given continued economic weakness, we plan to reduce costs by an additional $100 million."

THQ's losses came despite what looked like solid numbers for some of the holiday releases to which Farrell referred. The decently received WWE SmackDown vs. Raw 2009 shipped--not sold--more than 4 million units, followed by the better-regarded Saints Row 2 with 2.6 million units. The critically praised de Blob shipped some 700,000 units.

Discussion

124 comments
norabbitnofun
norabbitnofun

Looks to me like bad strategical choices were made to go for some unsuccessful games, and yet the developers pay for that. Any chance we get some clarificaion from what is going to change in THQ's senior staff minds? 2 games for hardcore is not really a strategy as far as I am concerned. They can probably do better - like really assess somehow better how successful a game is going to be, before the full development cost is invested?

pharcyde1521
pharcyde1521

Let me guess 2 games releases a year huh? Betcha one will be WWE smackdown 2010, more overgrown men in tights.. lets just cut the losses now fellas.. de Blob was cool though I must admit, first time I turned on my Wii in a while..

maliGGs
maliGGs

meh as long as they dont sack anyone from relic

jim4604
jim4604

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fatpumba3
fatpumba3

I like THQ games except for the WWE games it's a real shame that one of the top game developers in the world has to cut nearly a quarter of ther jobs.

Sins-of-Mosin
Sins-of-Mosin

WTF is with the author in mentioning the Bataan Death March for video game news? I will be filing a formal complaint and so will many others. The march, involving the forcible transfer of 76,000 American and Filipino prisoners of war captured by the Japanese in the Philippines from the Bataan peninsula to prison camps, was characterized by wide-ranging physical abuse and murder, and resulted in very high fatalities inflicted upon the prisoners and civilians along the route by the armed forces of the Empire of Japan. Beheadings, cut throats and casual shootings were the more common and merciful actions - compared to bayonet stabbings, rapes, disembowelments, numerous rifle butt beatings and a deliberate refusal to allow the prisoners food or water while keeping them continually marching for nearly a week (for the slowest survivors) in tropical heat. Falling down, unable to continue moving was tantamount to a death sentence, as was any degree of protest or expression of displeasure.

duke-nukem11
duke-nukem11

i just rented svr09 on the ps3. and to me its completely dead to me. like jtthegame316 siad. the engine that its been built on is flawed. they need to do a tony hawk, i.e scrap it all and start all over again, coz i used to love svr but its boring as crap now. cool if they made a ecw game. but thats all s--t now wwf no mercy rocked! and wcw vs nwo revenge! psn tag Duke-Nukem3D

Xzakuter
Xzakuter

@Goon22 Yeah Those ones were really good I liked NO MERCY! - N64.

Sins-of-Mosin
Sins-of-Mosin

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Sins-of-Mosin
Sins-of-Mosin

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dkricex
dkricex

As long as relic doesn't get affected

jtthegame316
jtthegame316

smackdown vs raw 2009 is good but the problem is it is expending on a flawed engine. the smackdown games have always been flawed the best engine for them to have built on would of been the gamecube wwe games cause they were quality. i like saints row but i have not picked up the second one yet but i will eventually.

Sydwynder
Sydwynder

It makes me sad that there are enough intellectually challenged people out there that THQ could ship over 4 million copies of a stupid wrestling game......

robx360
robx360

It's never going to happen people. I enjoyed the N64 wrestling games as well. They moved on and let me tell ya so will WWE. They have wanted out of the contract for years. I expect activision to pick up WWE. Also I don't expect the game to change to much though. Yukes has been making wrestling games for a long time. Anyone remember Powermove Pro Wrestling. It was one of the best of it's time. THQ is right there or below Atari in my opinion. I predict THQ to get gobbled up. Maybe even by Activision. We all know they are the new EA. Honestly though other than the WWE contract. Maybe even Saint's Row. Who would want THQ. Would you really miss them if they were gone. I wouldn't at all my friends. Fact is it would open up some spots on the shelf for other games. I'm just saying.

DDR_Midian
DDR_Midian

"Saint's Row, while not horrible, is not that great either." :O:O:O Saint's Row 2 is the true sequel to GTA:SA!

ZedX-14Pilot
ZedX-14Pilot

kytomasi is right. THQ hasn't put a hot game out in years, not just months. Saint's Row, while not horrible, is not that great either. It is a BLATENT GTA 4 ripoff, but, it does do somethings well. It just isn't stellar. And wrestling? Their games just suck. I think their talent is their, but, their creativity is not. Which is what alot of game companies are going through. They just keep feeding us the same 'ol crap.

XanderZane
XanderZane

With all the software sales they happened this holiday you would think that some of these companies would have turned a decent profit. Saints Row 2 sold over a million copies worldwide. Not too sure about WWE though. I'm just amazed at how many companies completed losed money in 2008.

kytomasi
kytomasi

I dont feel to bad about THQ. They havent made to many good games recently, i havent brought an THQ game in since smackdown on ps1. Their Quality of games just arent as good as other companies and their employees and workers are part to blame for poor games. 192 million in loss in one Quarter is very harsh, but what do you expect. I feel bad for the people that lost their jobs that are not part of the game development.

jev55_basic
jev55_basic

Both of those games were awful and only appealed to a small audience. People need to do better....

master_blue
master_blue

people give give and give for their jobs and this is the rubbish that happens.

boywantwater
boywantwater

I'm an old school wrestling fan, but honestly THQ has done the same formula for every wrestling game for the past 7 years. A new move or a quicker load time but still the same forula to rake in the cash, sooner or later though the consumer catches on. Looks like they have.

Cloud737
Cloud737

Bummer. "investing in [...] highest franchise potential" = lack of originality IMO. This means they're afraid of trying something new and will stick to the tried-and-true things only.

xbox4life76
xbox4life76

What is it going to take to get these companies going strong again? It's sad to hear.

enoslives7
enoslives7

meanwhile, the CEO just took another 4 million dollar bonus home

SMGalaxyRulez
SMGalaxyRulez

Thats so sad. Does that mean there won't be a Zack and Wiki 2?

Zero
Zero

How many more time must it be said? Get rid of smackdown and get back together with AKI. They will carry THQ back to the top. The fan base AKI games have is ridiculous.

Willy-Wilks_777
Willy-Wilks_777

Honestly, I saw this coming. I feel sorry for the people losing their jobs and all but THQ are awful when it comes to making games. The WWE series has been going on for too long and Saints Row 2.... Well it was rubbish.

GOON22
GOON22

n64 had the best WCW and WWE games

Henninger
Henninger

This sucks 4 THQ. But seriously they havent had a good game in a long time. & they need 2 go back 2 the WCW vs. NWO World Tour formula of wrestling games.

Gamingcucumber
Gamingcucumber

To be perfectly honest, they haven't made a particularly great game in a long long time, and I don't think those games deserve their sales numbers when other more deserving gets far less. Especially Smackdown vs Raw which is if possibly worse milking than Madden. THQ plays it far too safe. No, my only condolences goes out to the people who is going to be out of work.

vi3tdynasty
vi3tdynasty

man all these freaking people losing jobs...what happened to the video game industry not be affected...

awarapanmovie
awarapanmovie

its all lies just cuting poor people jobs nothing more

awarapanmovie
awarapanmovie

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CBass217
CBass217

Good and Bad news I guess. Bad for the people losing their jobs of course. I think the economic downfall is ""weeding out" the gaming industry. It seems like the companies that are more dependant on the casual gamers are getting hit hardest THQ, Sega, EA for example. We probably won't see companies like Capcom or Konami get hurt as much because their games are bought by gamers across the board (both casual and hard core) Companies like Konami and Capcom who make original titles and invest time and money into quality games will still run strong because their games are well thought out, hence making them more popular. Companies like THQ who rely more on casual gamers buying games like Monsters Inc or Iron Man will need to rethink their strategy and veer away from movie-to-game adaptations and invest more in new product development...which is good for the gaming industry.

mangojuiceboy
mangojuiceboy

@ Bhinder94 You're an ignorant ***, people losing thier jobs is not a good thing. I know exactly how it feels, got laid off last month. Hope you feel the same way when you get your pink slip.

Bhinder94
Bhinder94

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combatsoldier
combatsoldier

[This message was deleted at the request of the original poster]

GHOLY
GHOLY

Hey Grizzel WHAT THE HELL ARE YOU SAY MAN?

Amir29
Amir29

You know, for a game that is essentially the same since 2001, Smackdown sells very well. I would love to see what would happen if THQ and Yukes put some more effort into that franchise.

raahsnavj
raahsnavj

de Blob needed a button to jump in addition to the 'waggle' jump. WWE never has interested me, and Saints Row... heck I don't even like GTA why would I bother with a kid version of it?

-Raiden-
-Raiden-

Well make better games then!

pungaboy
pungaboy

Hey Grizzel - Go suck an egg.

insanitycheck3
insanitycheck3

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ukogmickey
ukogmickey

I hope the UFC game aint affected !

Grizzel
Grizzel

Maybe they should've made a good game, and maybe they would've kept their job.

SavoyPrime
SavoyPrime

THQ should start their rebuilding with the WWE series. It is really getting to the point where Yukes is putting out the same game year after year with minor improvements and a roster update. It is almost comparable to the Madden series in that respect. Starting with a new developer might help. Bring back AKI. THQ's wrestling games haven't been good since the N64 days in my opinion.