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Layoffs At THQ's uDraw Division

Following lower-than-expected sales of the new HD versions of its uDraw game tablet peripheral and games, 30 employees of the family-focused THQ Play have lost their jobs.
Game publisher THQ has laid off 30 employees from its family-focused Play THQ division, the company said Friday. Among other products, Play THQ spearheads the company's uDraw line of drawing tablet accessories, which failed to impress at retail this year. Among those affected is Martin Good, the THQ executive vice president who oversees the Play THQ business. Good is leaving after eleven years to "pursue new opportunities," according to a statement issued by THQ. THQ's uDraw GameTablet, a console peripheral that interacts with games through a handheld drawing tablet, was a surprise success for the company during the 2010 holiday season, when the Wii-only release shipped 1.7 million units, well ahead of the company's initial expectations of 1 million. This year the company expanded the uDraw line with new tablets and games for both the Xbox 360 and PlayStation 3. The new lineup debuted on American shelves on November 15, but sales have been far lower than projected -- so low, in fact, that the company has reduced its financial outlook for this crucial holiday quarter by around 25 percent. Recent statements by financial analysts, however, suggest that there could be more problems at THQ than the company is letting on: according to Wedbush Morgan analyst Michael Pachter, the downfall in revenue would account for nearly every uDraw unit the company is estimated to have shipped, suggesting that sales were either fiercely lower than anyone had anticipated or the company has problems it has not yet disclosed to investors.

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