THQ profits show power of licensing

Publisher THQ has posted net sales of more than $1 billion in their 2007 fiscal year, reportedly their 12th consecutive year of revenue growth. According to their annual financial report (PDF file), the company also managed to ship eight titles that exceeded one million units in sales. Their secret to success? Licensed titles.

The annual report revealed that THQ's focus was 80% licensed intellectual property and 20% owned IP -- a 4-to-1 ratio. Key achievements include shipping 8 million units of Disney/Pixar's Cars, 4 million units of WWE Smackdown vs. Raw 2007 and 4 million units combined of Nickelodeon franchises.

THQ did establish two franchises this fiscal year, Saint's Row and Company of Heroes, and this upcoming fiscal year, THQ intends to increase its focus on owned IPs to a 33% share on the pie graph -- that's now only a 2-to-1 ratio of licensed-to-owned IP.

Sure, licensed games may not be the most anticipated titles (or even the ones to receive the most coverage from the gaming press), but they do wonders to a publisher's bottom line.

This article was originally published on Joystiq.