Larger THQ Loss Still Better Than Expected

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THQ Inc. reported a larger fourth quarter loss mainly because of higher costs. The results still exceeded Wall Street forecasts.

After the markets closed Tuesday, the Agoura Hills video game developer, whose products include the “Saints Row” game franchise and the new uDraw GameTablet device, reported a net loss of $44.1 million (-65 cents per share) compared with a net loss of $10.4 million (-15 cents) a year earlier.

Net sales fell 37 percent to $124 million, but adjusted for digital revenue were up 26 percent to $248 million. Operating expenses rose more than 34 percent to $87.6 million, with about half the money spent on selling and marketing and the remainder to product development.

Adjusted for one-time items, net income rose 128 percent to $10.5 million (15 cents). Analysts surveyed by Thomson Reuters on average expected the company to report adjusted per-share profit of 11 cents on revenue of nearly $255 million.

“THQ posted strong fourth quarter results primarily driven by the success of Homefront,” Chief Executive Brian Farrell said in a statement. “We have already shipped 2.6 million units (since March), a solid start for this new franchise, which kicks off the strongest pipeline of core games in our history.”

For the full fiscal year, THQ reported a net loss of $136 million (-$2) on $665 million in net sales. That compares with a net loss of $9 million (-13 cents) on $899 million in sales in fiscal 2010.

Shares closed up 30 cent, or 7 percent, to $4.42 on the Nasdaq.

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