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THQ To Layoff 600 Employees

sjohnson
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Posted February 4, 2009 - By Stephen Johnson

Man, it's rough out there in the business world. Game publisher THQ has joined the ranks of companies forced to layoff workers, cut costs and report disappointing earnings. In a recently released quarterly financial report, THQ reported a net loss of $191.8 million, or $2.86 per share for  the three months that ended December 31, 2008.

During the fiscal third quarter, THQ executed on its previously announced business realignment plan and reduced its fiscal 2010 spending by $120 million. Not enough it turns out. Here's what the company is going to do to further cut costs and hopefully stay afloat.

  • Reduce product development spending by an additional $70 million through studio dispositions and other project and headcount reductions.
  • Reduce sales, marketing and corporate expenses globally through headcount and other cost reductions, with targeted savings of an additional $30 million annually.
  • Extend its leadership in the fighting category with such brands as WWE and Ultimate Fighting Championship
  • Revigorate the product portfolio and improve profitability in its kids’ business.
  • Build strong casual game franchises like de Blob, Drawn to Life and Big Beach Sports.
  • Extend its brands into emerging online markets with games such as Company of Heroes Online and its Warhammer 40,000 MMO.
  • Lower its expectations: THQ expects fourth quarter results to be significantly below previous expectations.

Overall, the company expects to reduce headcount by approximately 600 people, or 24% of its workforce.  Ouch.

On the positive side, in their release, THQ said they are very proud of the following games:

  • Saints Row 2: "Achieved a Metacritic rating of 82 and shipped more than 2.6 million units to date."
  • WWE SmackDown vs. Raw 2009: "Achieved a Metacritic rating of 80 and shipped more than 4 million units to date ."
  • de Blob: "Achieved a Metacritic rating of 81 and shipped approximately 700,000 units to date."
  • Big Beach Sports: "Shipped more than 1.2 million units to date." THQ didn't point this out, but It scored a 44 on Metacritic.

That all sure sounds bleak, but don't despair,  readers, because layoffs mean another visit from TheFeed's mascot of financial ruin, Ginger the Layoff Cat, the silver lining to the recession's storm clouds! Economic destruction has never been so adorable!

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THQ To Layoff 600 Employees
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