THQ misfires with Red Faction; stock takes a hit
THQ Inc.'s shares plummeted after the Agoura Hills game publisher reported disappointing first-quarter financial results due in part to poor sales of Red Faction: Armageddon, a science fiction shooter on which the company had pinned high hopes.
Shares in THQ, which closed unchanged at $3.20 during the regular session, fell 60 cents, or 19%, to $2.60 in after-hours trading. It had not traded that low since early 2009, when the stock fell as low as $2.24 in February 2009.
For its first quarter ended June 30, THQ posted reported a net loss of $38.4 million, or 56 cents a share, on sales of $195.2 million in the quarter ended June 30. It had lost $30.1 million, or 44 cents a share, on $149.4 million in revenue a year earlier.
“We are disappointed in our first-quarter financial performance,” said THQ’s chief executive, Brian Farrell. “Sales of Red Faction: Armageddon and our licensed kids titles were below our expectations.”
Released June 7, Red Faction: Armageddon, the fourth game in the THQ franchise, sold just 100,000 copies last month. Farrell said in a conference call with analysts that the company would no longer continue the franchise.
-- Alex Pham
Photo: Screen shot of Red Faction: Armageddon courtesy of THQ.