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THQ declares $220 million in spending cuts

By Brendan Sinclair, GameSpotPosted Apr 2, 2009 1:30 pm PT

The day after its latest layoffs, the publisher declares success in company-wide belt-tightening plan for its new fiscal year.

Yesterday, THQ began its fiscal year 2010. Today, the publisher today said plans to steady a lilting ship for the coming year have been successful, as the company has completed plans to cut projected spending for the year by $220 million.

THQ is counting on games like Darksiders to help turn things around this year.

Trimming expenditures by that much takes a lot more than creative accounting, as nearly a quarter of THQ's global workforce found out. Last November, the publisher shut down five of its internal studios and laid off employees at two more. The cuts continued last month with layoffs at Volition, followed by news that subsidiaries Heavy Iron and Incinerator Studios would be spun off into their own companies.

The publisher also said another of its internal developers, Big Huge Games, will be shuttered if a buyer can't be found in the near term. While the lights remain on at Big Huge, THQ confirmed that there were layoffs at the studio earlier this week. In addition to the personnel moves, THQ said it would change its focus to quality over quantity, and halved the number of games it would market to the traditional hardcore market each year.

"We have executed on our previously announced business realignment actions," THQ president and CEO Brian Farrell said in a statement. "Our goal is to return to profitability and generate positive cash flow in fiscal 2010, and to position THQ for long-term sustainable and profitable growth."

For this year, THQ's big bets include Red Faction: Guerrilla, Ultimate Fighting Championship, and Darksiders: Wrath of War. Looking beyond fiscal 2010, the publisher's plan includes continued emphasis on its owned intellectual properties, including more games in the Red Faction, Saints Row, and Darksiders franchises.

25 Comments

  • Echonian

    Posted Apr 27, 2009 10:11 pm PT

    Red Faction: Guerilla looks like it could be the best open-world destructible-environment game ever made, as long as they haven't majorly screwed anything up. The demo was amazing, but showed off little. Definitely need to rent it first though. Or maybe not.

  • LakeView9480

    Posted Apr 8, 2009 1:37 pm PT

    I am really looking forward to Darksiders. I'm a huge fan of Joe Mad! and all of his collective works. Hope they don't shut down before it's released.

  • Humorguy_basic

    Posted Apr 6, 2009 8:48 am PT

    Looking at the games they are relying on for 2010 and beyond, I don't think THQ will be with us much longer. If Violition had been able to do Freespace 3, then THQ woud have made some decent money from that! Publishers just don't get it: Freespace 1 and 2 sold nearly 5 million copies! Today a hit PC games is a million or more - that means just 20% of the FS1 and 2 players had to buy Freespace 3 for it to be a big hit - and if it was another Freespace as great as the first two it could easily have sold to half of them! That's 2.5 million sales - more than Bethesda has done on Fallout 3 PC, more than Bioshock on PC, more than Crysis on PC! Look backwards to look forwards is my advice to PC games companies - even EA is doing a Syndicate remake for goodness sake!

  • richioso

    Posted Apr 6, 2009 5:00 am PT

    GSP won because he's better, get over it.

  • akiwak

    Posted Apr 4, 2009 2:34 pm PT

    I am one of those that will be buying the UFC game. It is a difficult one to make because it must incorporate all different fighting styles. As long as it is decent I will buy, my first match up will be BJ Penn VS Vaseline Rubbing GSP (in the game there will be no cheating so we'll get to see how the second fight should have turned out)

    AS REAL AS IT GETS!!!!

  • tuvideo87

    Posted Apr 4, 2009 12:33 pm PT

    RROD. red ring of deaf its in 33% of all xbox

  • Some-Mist

    Posted Apr 4, 2009 9:27 am PT

    I'm glad they're not canceling darksiders as I feel it's a smaller title. then again, people might be as pumped for it as I am I was really hoping for the release of it 3-4 days before re5 but I can wait :]

  • ladsud

    Posted Apr 4, 2009 9:22 am PT

    Afraid to buy ok games? I have better things to spend 60 dollars on than an "ok" game. its not my job to keep software companies alive. As said in this article they need to focus on quality instead of trying to flood the market with 50 crap games a year that no one wants.

  • Amir29

    Posted Apr 3, 2009 4:13 pm PT

    @solidstein: Is that such a bad thing? I prefer a smaller selection of software, if I realized ALL of the software on the shelves was good. I find this recession to be the beginning of something good for every industry. These hard times will make manufacturers and developers give us more for less. And when it comes to video games, I believe that's looong overdue

  • solidstein

    Posted Apr 3, 2009 2:16 pm PT

    if we all would spend some money then there wouldnt be a recession but everyones afraid to buy ok games now so game developers have to make something they now will work instead of trying something new that might become the next zelda

  • Amir29

    Posted Apr 3, 2009 12:12 pm PT

    @ LordDeArnise: No worries man. they're probably just going to give it a roster update, add a few animations to "Create-A-Finisher" and slap a 2010 on the name. You know, they they've done every year since "Here Comes The Pain"

  • SolidSaldin

    Posted Apr 3, 2009 8:54 am PT

    I hope this doesn't affect the new Red Faction game negatively.

  • DangerClown

    Posted Apr 3, 2009 7:41 am PT

    Everyone seems to want and Eastern front add-on for COH. Why does THQ hate making money, so?

  • NobleEskimo

    Posted Apr 3, 2009 5:20 am PT

    Personally, I think the UFC game is going to dominate sales charts for a couple of weeks. UFC is HUGE right now, and if people are paying $50 a pay-per-view, I think they can afford $60 for a game.

  • endocrine

    Posted Apr 2, 2009 8:04 pm PT

    People that continue to say this is recession based makes me laugh. Video game companies have made record breaking profits in the past year; the difference is they have also made record breaking expenses. This is a poor management problem and not an economy problem.

  • LordDeArnise

    Posted Apr 2, 2009 5:42 pm PT

    No mentioning of WWE Smackdown v. Raw 2010? I hope that's still "go".

  • EnderSR388

    Posted Apr 2, 2009 4:48 pm PT

    GIVE US A NEW PUNISHER GAME! Volition made THE best Punisher game ever.

  • lil_luz_10

    Posted Apr 2, 2009 4:44 pm PT

    LMAO "none of that will mater.....because you are going to TEAR IT ALL DOWN!!!"

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