Shares in THQ Inc. plunged more than 30 percent Thursday after the company lowered its fiscal third-quarter profit outlook on charges related to product development and underperforming titles.
The Agoura Hills-based videogame developer said it now expects to post a profit of about 22 cents per share for the quarter, a steep decline from its earlier forecast of 61 cents per share.
Analysts were expecting a profit of 66 cents per share, according to a poll by Thomson Financial.
However, despite cutting its outlook, THQ did increase its sales guidance for the third quarter to $509 million from $490 million, mainly due to better-than-expected sales of "WWE SmackDown vs. Raw 2008" and "MX vs. ATV Untamed" video games. Wall Street was expecting sales of $488 million.
However, THQ lowered its fourth quarter sales outlook to $200 million from $240 million and added that it expects a loss of about 13 cents per share for the quarter. Wall Street was looking for sales of $238 million with a profit of 24 cents per share.
THQ said the shift is due to about $20 million in accelerated amortization expenses related to some underperforming games. The company will also record non-cash charges of about $27 million related to development and its product pipeline.
THQ also said that it is closing its Concrete Games studio but will offer many of the employees positions at other divisions of the company.
Shares in THQ fell $7.54 to $17.56 in early trading Thursday.
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