THQ layoffs hit 240, CEO takes 50% pay cut

Publisher confirms scope of layoff plans, reduces Brian Farrell's salary from nearly $720,000 to about $360,000, trims possible severance package payout.

Rumors of THQ's recent round of layoffs apparently understated the issue. In a filing with the Securities and Exchange Commission today, THQ said that its restructuring plan to get out of licensed kids' games will result in the layoffs of "up to 240 selling, general, and administrative personnel worldwide."

Another day, another round of bad news from THQ.

It isn't just the rank and file THQ employees who are suffering the brunt of the company's recent financial woes. The publisher also announced that CEO Brian Farrell would be taking a 50 percent pay cut for the next year from $718,500 to $359,250. Should his employment be terminated for good reason, Farrell's parting compensation package will also be reduced. Instead of receiving triple the amount of his highest performance bonus from any previous year, Farrell would now only receive that base amount without the multiplier.

Last week, THQ announced a new, "streamlined" business direction that saw the publisher exit the children's game publishing business. The company said it will now focus directly on its core properties, franchises like Saints Row, Warhammer, Darksiders, Company of Heroes, UFC, and inSane.

Yesterday, global stock market NASDAQ issued THQ a delisting notice, stating that if the company's per-share value does not hit at least $1 for 10 consecutive days before July 23, 2012, it will be subject to removal from the market.

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Discussion

57 comments
sammyd1234
sammyd1234

i believe if game companies can take a percentage of the profit of used games this wouldnt be a problem, they need to find a way to get rights to used games is what im saying, its there games they should own the profits it no-matter what. does this make sense to everyone?

sammyd1234
sammyd1234

THQ we've had a good run, its time to say goodbye, GOODBYE!!!!!!!

cachinscythe
cachinscythe

@merleage2 And your company would probably go under within 5 days or at most a year. (Sad, but true.) Even people who love to make games don't love to make them all the time or for nothing.

Megavideogamer
Megavideogamer

A least the CEO is has manned up and taking a pay cut, which most don't so THQ can have a chance at making a come back.

Phoenix_Down89
Phoenix_Down89

@Vangaurdius I thought it was Relic who made CoH and the Dawn of war games, THQ just published it right? if so I dont really mind if THQ goes down as long as Relic can get their games made haha

robx360
robx360

I'm just waiting for ea or activision to scoop them up!

icym
icym

compensation package? you know, CEO's salaries should be tied to number of people they layoff.

merleage2
merleage2

if i owned a company everybody would make exactly 50,000 dollars a year. maybe there would be a chance to earn a little more based on work ethic and quality of the work done. cause you see my employee's would work for me because they love creating games, not for the money. also me and my ceo would make exactly 50,000 dollars a year, no special treatment for us. and if you cant live off of 4,600 a month then i don't know who you are or how you live but i don't want you working for me anyway. lol

Valen_Ca
Valen_Ca

Well at least the CEO is taking a pay cut, that shows a small amount of class at least

bdous
bdous

Why THQ has problems? That company has released many great games that have sell millions of copies

origamistyle
origamistyle

@mjc0961 Iwata is very much an exception to the rule, as is Farrell. Seems to me like most companies' CEOs would off as many workers as necessary in order to hang on to their precious bonuses. I've never been a big THQ fan, but I hope they recover and regain stability.

y3ivan
y3ivan

@AcidSoldner homefront2 isnt been made by their own studios. It was contracted to cryteck. Also THQ saw homefront was a disaster and fired the studio that made it. Although i really like the unique approach into multiplayer.

Sendmn23
Sendmn23

uh... yeah.. all I want is Darksiders 2... I couldn't care less for the rest of their line up.

Vangaurdius
Vangaurdius

The problem with this has nothing to do with used sales. It's that THQ hasn't put out anything worthwhile for some time. What they need to do is release a sequel to a popular IP. Company of Heroes being the most logical choice right now. Put a lot of love into it and using the profits you make off of it spend almost every penny you can on coming up with another profitable IP. For example, they have the Dawn of War games, why not release a semi-tactical FPS that instead of doing what Space Marine did and focus on a small squad, instead focus on the large scale that occurs within said universe. This way they can balance out the small scale setting of their other games with a larger scale. One thing they could do is take a look at the largely untouched fantasy warhammer. Why warhammer though? Because they are familiar with the universe. That can really help in the long run. And though 40k and fantasy have evolved to become seemingly very different, the share certain properties that given their current experience, could save some time. Could use that to expand into an RPG. It would be fairly easy to make given the large amounts of lore available. My 2 cents anyways.

DrKill09
DrKill09

This sucks... :( I hope SR finds a new home if they go under.

Grim_Reav3r
Grim_Reav3r

Sad to hear about THQ's current state. But at last they realized their mistakes by stopping kiddy games and Homefront (had serious flaws in online multiplayer). DOW - Retribution (previous version of DOW was awesome, this time boring...) Please continue making Saints Row, Warhammer, Darksiders, Company of Heroes.

daabulls23
daabulls23

A CEO taking a paycut when times are tough? Unheard of. And cutting the severance package so he can't just leave and get richer? That's insane! Why can't more companies do this? It at least shows that the people at the top knows there is some financial trouble. What would help would be some COH in the pacific.

Gv0zD
Gv0zD

THQ realised the flaws in their business strategy, but did it at high cost of cutting people jobs. I wish THQ will survive these dire events and will bring us new warhammer and company of heroes games. I wish the people who lost their jobs could find new jobs in this growing industry. It is a shame that the most widespread way to cut costs is to get rid of people

Spacemancer
Spacemancer

You have to live long enough for Homeworld 3!!!! Please don't go :(

nightshade869
nightshade869

@nyran125 It is called used game sales and gamestop. That is what's wrong with the industry. Consumers think they have a right to used games and use that to justify give gamestop billions of dollars and the developer and its employees nothing. Then the consumer complains about online passes too. What a conundrum.

nightshade869
nightshade869

I hope they can recover, it seems like EA and Activision and Ubisoft will be the only ones left soon.

Lhomity
Lhomity

I bought Saints Row: The Third, today. If you support THQ and want to see them stay in business, and continue providing us with quality games, you can do your part, albeit a very small part. Buy a THQ game for yourself or your friend. Make sure you buy a new copy. A used copy will not send a single cent their way.

X_Colbert_X
X_Colbert_X

This really is tragic. 240 layoffs is 240 individuals left unable to pay bills or support their families in these harsh times. People have to realize that for a megapublisher, a $720,000 salary is actually quite low, so I really must commend Brian Farrell for cutting that number in half. By comparison, for the year 2010, Bobby Kotick (CEO of Activision) had a total salary of $5.6 MILLION--about 1 million of which was actually "salary" and the rest being stock options and bonuses. Best of luck to those affected by these layoffs.

Barighm
Barighm

A CEO took a pay cut? Now THAT's news!

prostar343
prostar343

Hard times for THQ. Hopefully they get through it, and hopefully those who lost their jobs find work quickly.

nyran125
nyran125

gaming will go into a recession one day soon, if they keep pumping $100 million into game marketing and most of that is going back into the shareholders pocket. If a company thats sold MILLIONS adn MILLIONS adn MILLIONS of games like THQ is going under. Then something is seriously wrong financially in the industry as a whole.

snipeshot11
snipeshot11

Good thing IMO, not that people are losing their jobs, but that companies are realizing that they need to quit with all the shovel ware...its unfortunate they are finding out the hard way. Don't say we didn't warn you...

nurnberg
nurnberg

So the rumors were true after all. The company is really struggling.

Dark_Arcitekt
Dark_Arcitekt

Ouch that's rough. It's a rough cut indeed.Hoping they bounce back from this.

helldew
helldew

They will pull through. if they make good games this restructing better damn well fix some of this crap cause with products like that going under would just be pitiful.

RE2LeonS
RE2LeonS

He had a $700,000+ salary?! No pity coming from this direction, even with 50% taken off. Make it 90%, then I'll consider it. But his salary covers about 23 average salaries!

bojan_sokol
bojan_sokol

Make Company of Heroes 2 and you will escape from the s**t where you are now

OJ_the_LION
OJ_the_LION

I'm worried about THQ, but I hope they pull this off. They do make some good games, it'd be a shame for them to go under because of corporate mistakes rather than poor products.

dRuGGeRnaUt
dRuGGeRnaUt

This isnt cool news about thq, but their handling of the matter is invigorating. It's very rare to see high-ups take pay cuts, but not only did it probably save 4-5 peoples jobs, it is a good "inspirational" move to make. - Sidenote: It's also hard to believe that a CEO of a company as large as THQ only originally made $718,000 a year. If only some other companies(activision, cough cough) could handle the same structure lol. - Here's hoping THQ pulls through this, I know they have many eager fans.

deviant74
deviant74

Reverse stock split. Saints Row 3 HD with some added story on the U at launch.

AcidSoldner
AcidSoldner

It's saddens me that Homefront isn't listed as one of their "core franchises" even though it sold well over 1 million copies.

Setho10
Setho10

THQ has a lot of potential for 2013. They have Insane, Homefront 2, Devil's Third, and whatever comes from THQ Montreal. They just have to get through this year without going bankrupt to make it to that point. I hope they pull through. They have really improved the quality of their output in recent years.

Link3301
Link3301

Good to see that some CEO's actually care for their employees and their companies.

Pickleking23
Pickleking23

Saints Row The Third may need some patching on pc but that game is so freakin awesome, that I will def keep my eye on the series.

scarletsnake
scarletsnake

THQ has for the most part released quality games, the original Red Faction, The Punisher, WH40K titles etc... I hope they get their act together and start pushing out the classics they once released next to the current-gen mindless games(50cent-crap, homefront etc...) they've been publishing

---Cipher---
---Cipher---

Wait... A CEO actually getting paid less for their company doing poorly? The hell? Is this bizzaro land where business makes sort of sense? I always assumed ceo's were supposed to drive a business into the ground, they normally get paid more that way... THQ isn't my favourite, but the fact even upper management has taken a hit means they got brownie points from me.