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THQ – Saints Row titles ship 11M, Devil’s Third dropped

Tuesday, 15th May 2012 21:25 GMT By Stephany Nunneley

THQ has announced increased revenue and losses for FY12. The firm also delayed South Park: The Game into Q1 2013, and it will no longer publish Itagaki’s actioner Devil’s Third.

THQ Q4 and FY 12 at a glance

In third-party discussions over publishing Devil’s Third, Tomonobu Itagaki’s action title.

Darksiders II pre-orders are five times that of Darksiders 1; releases August 14.

Saints Row franchise ships 11 million worldwide; Saints Row: The Third ships 4.25 million worldwide.

South Park: The Game delayed from second half of 2012 to Q4 FY13. It will release sometime between January 1 and March 31.

UFC Undisputed 3 shipped 1.4 million units; WWE ‘12 shipped over 2.2 million units.

Marketing campaign for Metro: Last Light will start at E3; THQ to market it extensively.

Revenue was up for the quarter and FY 12, but heavy losses were reported year-over-year for the quarter and full fiscal year.

Digital revenues for Q4 were $18 million, up 44% yoy; digital revenue for FY 12 were $59 million, up 62% yoy.

Trading with GAME still continues, but limited as compared to the past.

THQ reported revenue of $184.2 million for the three months ending March 31, and revenue of $830.8 million for the full year, compared to $124.2 million and $665.3 million in revenue for the same periods in 2011, respectively.

For the quarter, the firm reported net losses of $53.2 million compared to $44.1 the year prior ($9.1M difference), and for full year $239.9 million in losses compared to $136.1 million in 2011 ($103.8M difference). The firm said all figures “exceeded guidance.”

THQ’s digital revenues for Q4 2012 were $18 million, up 44% compared to the same quarter in 2011. Digital revenues the full fiscal year were $59 million, an increase of 62% year-over-year.

Revenues for the firm have increased 25.7% on average year-over-year for the last five quarters. The second quarter saw a revenue increase of 89.5% year-over-year, by far the largest for the period.

“We exceeded our initial fourth quarter guidance for net sales, earnings and cash position, driven by high quality core games with a significant digital component, which is the blueprint for our future,” said THQ president and CEO Brian Farrell. “We have made significant changes to our business, and are on track to execute our strategy of delivering quality connected core gaming experiences, beginning with the sequel to the award-winning Darksiders in August.”

Farrell noted in the call to investors this evening that THQ was currently in discussions with third-parties regarding Tomonobu Itagaki’s Devil’s Third which he said no longer “fits THQ’s profile.” The driving force for this, according to Farrell, was loss of profitability due to two “unforeseen development events.”

One of these unforeseen events was that the company which provided Valhalla with the game engine went out of business. THQ had to help Itagaki and Valhalla with procuring a new engine “which cost a fair amount of money,” said Farrell.

The second reason was the current Yen and Dollar conversion rates. Both contributed to the loss of profitability, despite Devil’s Third being an “excellent franchise.”

Farrell said THQ has enjoyed working with Itagaki and will do what it can to make sure the game comes to the market – albeit through a third-party.

WWE 12 has shipped more than 2.2 million units since its launch in November 2011 thanks to higher sell-through rate of 20% on like-for-like platforms in North America versus last year’s release. Farrell attributed the game’s stellar sales with the revamping of the series.

UFC Undisputed 3 has shipped 1.4 million units since its mid-February 2012 launch, and the firm noted 11 million units were shipped globally for the Saints Row franchise with 4.25 million units of Saints Row: The Third shipped. Both figures are up from what was previously reported by the firm in April.

The firm also touched on its realignment plan, which will be fully realized in fiscal 2013, and is expected to result in “a reduction of product development expenditures, selling and marketing expenses, and general and administrative expenses totaling $180 million from the company’s annualized run rate.”

The company has reduced its future kids’ license commitments by approximately $30 million and is no longer manufacturing software and hardware for the uDraw GameTablet.

Based upon sell-through in North America of approximately 84% of units shipped, THQ expects to be able to sell its remaining uDraw inventory in fiscal 2013 at its current, carrying value. An additional 137,000 tablets were shipped during Q4.

THQ also reiterated its upcoming software lineup as follows:

  • Darksiders II – August 14, 2012
  • Saints Row: The Third – Enter The Dominatrix – September 2012
  • Annual WWE Game – Q3 FY13
  • Company of Heroes 2- Q4 FY13
  • Metro: Last Light – Q4 FY13
  • South Park: The Game – Q4 FY13

Note the delay of Obsidian’s South Park RPG, which means it will release sometime between January 1 and March 31, 2013.

During the call to investors this evening, Farrell mentioned the Turtle Rock,Patrice Désilets and Del Toro’s game inSane in passing, but failed to offer details other than all are still in development. The firm also expects to have next-gen system games available for launch or shortly afterward, but Farrell didn’t indicate whether the aforementioned games would release on current systems or if THQ would hold out for next-gen.

CFO Paul Pucino said at this point, it’s “premature to talk about [next-gen] costs,” but THQ assumes the cost of development will be “relatively equal,” to current gen systems.

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12 Comments

  1. Stephany Nunneley

    Okay that should be nice and tidy now. Just waiting on the call to investors to start. They are running late.

    #1 3 years ago
  2. The_Red

    Dammit, WTF is going on here? Two of my most anticipated titles of 2012 (BioShock Infinite and Tomb Raider) were delayed to 2013 recently and now my number one choice has also slipped into next year.

    Hopefully both South Park RPG and Metro Last Light can make good use of the added time.

    #2 3 years ago
  3. AHA-Lambda

    “Based upon sell-through in North America of approximately 84% of units shipped, THQ expects to be able to sell its remaining inventory in fiscal ’13 at its current carrying value.”

    Really?? I didn’t expect this, wasn’t the uDraw HD one of THQ’s (if not the single) biggest problem they’ve had in the past year?

    #3 3 years ago
  4. Erthazus

    Devils Third dropped?

    Wow.

    #4 3 years ago
  5. Monk

    Devils Third dropped ?

    Oooh Kamiya, you`re laughing so hard right now.

    #5 3 years ago
  6. Stephany Nunneley

    Okay. The call is over. Everything important in there (I think). Should be tidied up now as well.

    #6 3 years ago
  7. zantoplisek

    @3: It doesn’t necessarily mean it’s good. It’s probably selling at a lower price than it did initially (to have the retailers carry the thing at all and to attract consumers). They are just trying to get rid of it, that is all. Just because 84% is sold-through, it’s not a good thing. It shows how hard they are trying to salvage as much as they can from it.

    #7 3 years ago
  8. xino

    as Raiden says in Unreal Championship 2 “SHOCKING”

    I don’t believe it man.
    SO who will publish Devil’s Third, it is going to be a Japanese Publisher but who will raise and fund so much money for the game man?

    damn.

    I swear down if Publishers are not too stupid and can understand the crisis situation instead of looking at this at a business standpoint.

    A lot of fans are p*ssed off and let down by Ninja Gaiden 3. Devil Thirds is…well now *was going to make 1 million sales because of failure of NG3. If these publishers can see this (which they don’t), they will fund Valhalla Studios. Simply because Itagaki’s really brainwashed a lot of fans and these fanboys cannot stop hammering on his name when ever Team NINJA, Ninja Gaiden or DOA gets mentioned.

    Man what a nut job. Devil’s Third looks like an ambitious title and from Itagaki himself a well known infamous game designer. Also the game is meant to take on the 3rd Person Action genre competition. And being a Japanese made title but aimed at West.

    The only 2 publishers I see funding Devil’s Third are Capcom and Namco but do they really have the money? Capcom are starting to collaborate with Western Devs which is what Vallahl and THQ are doing so it fits Capcom to publish this game.

    I don’t know about Namco working together with Western as a collaboration. But they are funding Inversion, but that game has been pushed back!

    Activision is the person I am hoping they fund and publish this game. Activision already dropped True Crime 3 which was nabbed by Square Enix. Activision SHOULD see THQ cannot publish an opportunity game.

    Or will EA pick this up? I highly doubt it, if Devil’s Third does not fit THQ’s games profile, it will not fit EA’s profile too.

    What about SEGA? SEGA can publish this but will they have the money?

    my god, I will be surprise if Konami publishes this game!

    this is a big shocker and also interesting, funny thing is E3 is also here which is making things getting exciting and f*ked up.

    UPDATE

    The funnies thing to happen and ironic is if Tecmo Koei publishes Devil Thirds. My god. this Gaming Industry is f*ked in the head.

    #8 3 years ago
  9. voxelman

    Hmm Square Enix seems to like picking up games and studios, so they are probably at the top of the list for picking up Devil’s Third.

    Warner Bros Interactive are looking to expand so they may pick it up for the USA at least. Bethesda is another possibility, they are constantly looking to expand and are flush with cash after Skyrim.

    #9 3 years ago
  10. AHA-Lambda

    I can’t see any publisher picking this up? This is exactly the kind of game that screams bomba.

    #10 3 years ago
  11. DSB

    My fear going forward is the notion that THQ is going to have to pick all winners to stay afloat.

    And if there’s anything they’ve completely sucked at the last seven years or so, it’s been picking winners.

    I don’t trust a company that nearly goes under and doesn’t make some serious leadership changes. It’s just not responsible. Brian Farrell steered them into the iceberg, so why is he still steering the ship?

    #11 3 years ago
  12. silkvg247

    How can they be making such massive losses?

    I bet they have too many managers and pay each far too much.

    #12 3 years ago

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