THQ revises expectations

Company now expects to lose money for the quarter based on change in WWE development strategy and poor performance of Full Spectrum Warrior: Ten Hammers.

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THQ gave its investors a heads up on some good news and some bad news on the way after the end of trading yesterday, as the publisher warned investors that quarterly revenues would likely be higher then expected, but the small profit the company anticipated had turned into a likely loss.

For the company's fourth quarter of fiscal year 2006 (the three months that ended March 31), THQ is now projecting $150 million in sales (a bump of $15 million over previous expectations), but a net loss of $.13 per share. Previously the company had expected a net profit of $.02 per share.

THQ blamed the swing on a "change in its development strategy" for WWE games that sees all internal development on wrestling games cut. The company owns a minority portion of Yuke's, the Japanese studio that has handled its SmackDown! vs. Raw and Day of Reckoning WWE brands, and recently signed a long-term development agreement with the company.

Poor retail performance on the part of the recently released Full Spectrum Warrior: Ten Hammers was another factor cited in the downgraded expectations. THQ is expected to report its financial results for the quarter on May 5.

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