THQ is celebrating record results for its fiscal first quarter thanks largely to the widespread success of
UFC 2009 Undisputed, which drove net sales up 77 percent to $243.5 million. The publisher's quarter ended June 30.
UFC 2009 Undisputed has shipped over 2.9 million units globally to date, and the publisher says
Red Faction: Guerrilla -- which has shipped more than one million units -- also played a role in boosting profits to $6.4 million for the quarter.
(During the same period last year, generally a slow one for retail game publishers, the company recorded a $27.2 million net loss.)
The company's CEO Brian Farrell particularly highlighted the strategic decision to
refocus THQ's business into three distinct units: Core Games; Kids, Family and Casual Games, and Online Games as a key strengthening factor for the road ahead.
THQ also expects to report a one-time benefit of $23 million during its second quarter -- thanks to
the recent resolution of its longstanding royalty dispute with WWE licensing partner Jakks Pacific.
Factoring in its
UFC success -- and THQ's assertions that its cost-cutting will lead to narrower operating losses -- the company says it's on track to achieve profitability in 2010 at last. It hopes to finish the year with a cash balance $50 million higher than at the end of last year (excluding payments to Jakks).
This is despite the fact THQ has no new releases slated for the second quarter, and therefore estimates Q2 2010 to be weaker than the year prior -- with net sales in the range of $85-$95 million compared to $151.6 million in Q2 2009.
Despite the positive results for the last three months, low estimates for the second quarter disappointed most investors, and the company's share price fell about 6 percent in late-day trading on the news.
Nonetheless: "Our first quarter results demonstrate the benefits of our more focused product strategy and aggressive cost management," commented THQ CEO Farrell. "These record results reflect the hard work and dedication of our employees around the globe."
