THQ beats Wall Street by ditching next gen
THQ’s profits dropped, but they still beat analysts’ estimates. The trick: heavy on handheld games, and no love for Xbox 360.
FULL STORY:
On Thursday, Electronic Arts released disappointing results for the third quarter of the fiscal year, which covers the three months ending Dec. 31. Their game sales missed Wall Street’s expectations, partly because there just weren’t enough Xbox 360s out there to support the number of games the publisher needed to sell.
Though THQ also performed poorly in comparison to the 2004 holiday season, they managed to beat the Street’s expectations by a long shot — the publisher earned 72 cents per share on expectations of 65. So what’s the difference? THQ chose to focus on current-gen games, particularly handhelds, and they stayed away from the Xbox 360 altogether. About 1/3 of THQ’s sales came from handheld games; just 5 percent came from current-gen Xbox games.
So, we won’t get you too bogged down in stock analysis, but maybe this is the bright spot in the gaming industry’s not-so-merry Christmas. Things will be better for everyone next year.
• EA Misses, THQ Hits [The Motley Fool]
