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

By Tor Thorsen, GameSpotPosted Feb 4, 2009 3:13 pm PT

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.

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.

124 Comments

  • prdroog

    Posted Feb 9, 2009 3:20 pm PT

    THQ...lol

  • norabbitnofun

    Posted Feb 9, 2009 2:26 pm PT

    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

    Posted Feb 8, 2009 4:05 am PT

    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

    Posted Feb 7, 2009 11:37 pm PT

    meh as long as they dont sack anyone from relic

  • fatpumba3

    Posted Feb 7, 2009 3:16 am PT

    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

    Posted Feb 6, 2009 5:05 pm PT

    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.

  • polodoro

    Posted Feb 6, 2009 3:40 pm PT

    wow. English please?

  • duke-nukem11

    Posted Feb 5, 2009 4:46 pm PT

    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

    Posted Feb 5, 2009 4:08 pm PT

    @Goon22

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

  • dkricex

    Posted Feb 5, 2009 2:43 pm PT

    As long as relic doesn't get affected

  • jtthegame316

    Posted Feb 5, 2009 2:37 pm PT

    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.

  • Red_A_Link

    Posted Feb 5, 2009 2:36 pm PT

    i hate thq

  • Sydwynder

    Posted Feb 5, 2009 2:36 pm PT

    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

    Posted Feb 5, 2009 1:48 pm PT

    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

    Posted Feb 5, 2009 1:42 pm PT

    "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

    Posted Feb 5, 2009 1:27 pm PT

    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

    Posted Feb 5, 2009 1:26 pm PT

    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.

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