While THQ may be rebounding in terms of brand and product quality, that doesn't mean it can simply take the express bus to Money Town. There's more to running a successful entertainment business than simply making well-received games.
For its fiscal 2011 first quarter ended June 30, 2010, the publisher reported net sales of $149.4m driven primarily by UFC Undisputed 2010. While that sounds like a lot of scratch, that's compared with last year's sales for the quarter of $243.5m, driven by UFC 2009 Undisputed and Red Faction: Guerrilla. The earnings report explains, "No title comparable to Red Faction: Guerrilla was released during the first quarter of fiscal 2011." With sales down, losses are up, with a net loss of $30.1m for the quarter compared with a net income of $6.4m for the same period last year.
So with all bets on UFC 2010 for the quarter, and despite a stronger Metacritic score, it managed to move just 2.7m units compared with 2.9m units for its predecessor last year. "We built our plans for growth in UFC this year," Farrell told investors.
Though no new major titles are planned for the company's upcoming Q2 period, the remainder of the fiscal year holds releases for both Homefront and Red Faction: Armageddon, and THQ expects non-GAAP net sales "in the range of $845 million to $865 million" and "roughly breakeven" earnings for the year. The focus is very much on fiscal 2012, which includes major releases like Warhammer 40000: Space Marine and Darksiders 2. "We also delivered our most critically acclaimed E3 showing ever with a strong line-up of games in development, several of which are based on proven long-term franchises," Farrell says. "Our goal this fiscal year continues to be to position THQ for growth in fiscal 2012 and beyond."