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THQ's Business Woes Continue

Update: For the record, most of those on the chopping block (the 240 listed in the story) have already received their walking papers, and game studios didn't suffer; those whe were laid off were in the "administration and publishing offices."

So that's not too terrible.

Original Story:

Not long after being warned of a NASDAQ delisting, we learn that THQ's financial woes may have only just begun.

According to a recent filing with the Securities and Exchange Commission, the publisher confirmed its restructuring plan (that was previously announced to include the abandonment of licensed games for kids), and it's significant. Up to 240 THQ employees could lose their jobs.

Furthermore, CEO Brian Farrell will take a 50% pay cut for the next year; instead of $718,500, he'll only receive $359,250. And if he disappears, his compensation pack will also be reduced in value. So while THQ starts to focus only on their "core franchsies" (Saints Row, Darksiders, Company of Heroes, UFC, Warhammer, and inSane), even the company executives will have to sweat over their jobs.

Let's hope THQ can steer their way clear of this mess; it's never good news when established game publishers flounder.

Tags: thq, thq layoffs, thq games, game industry

2/1/2012 8:33:28 PM John Shepard

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Comments (8 posts)

Temjin001
Wednesday, February 01, 2012 @ 9:50:09 PM
Reply

I have a friend, a professional artist, who is contracted to do work for the company. He said a big problem is definately their management. And yes, there's a lot of empty spots in their corporate offices right now. He said that terrible marketing expenditures and irrational sales expectations are a large part of the problem. The games they've released under ordinary, logically minded management, would have turned profits, if they weren't over budgeted for advertising. He said something like Homefront had approximately a $50million marketing budget which was way too extreme for a dev who wasnt a AAA dev, the team knew that themselves, and were stressed out trying to meet the lofty sales expectations. Anyway, hopefully, they get a decent management team so the talent they've got will be well guided and well represented going forward.

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Qubex
Thursday, February 02, 2012 @ 1:43:38 AM

The "irrational" sales projections are usually the main culprit, which in turn means irrational marketing decisions and costs structures that don't make sense...

"Homefront" was a new I.P. Why throw everything at a new I.P. when a] you have no idea how it will turn out, and b] don't "shoot from the hip" trying to emulate COD success.

For some genres and new I.P. titles it may be best to start small. Quality rather than quantity. They could have maybe made an initial "Homefront" to be smaller but 2 or 3 high quality but short campaign stretching over 3 stages. A prequel if you will and flog it on PSN for an acceptable $14.99 as a digital download.

Another option is to tag that onto another fully priced THQ title that has had some history and consistency behind it, maybe with a sequel to an I.P. that has had already some modest success already! Idea is to get as many people playing it and enjoying the initial release.

Homefront 2 could then be released as a fully priced AAA title, after the initial development team has gelled, the right skills are in place, the quality is there and you have had some success with the PSN title too boot...

I think the risk these days to come out shooting and all guns blazing is very risky indeed, especially if you have just sunk $20 to $40 million on an "untested" I.P. - even if that new I.P. lives within a popular genre, the mighty FPS.

Q!

"play.experience.enjoy"

Last edited by Qubex on 2/2/2012 1:45:32 AM

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Killa Tequilla
Thursday, February 02, 2012 @ 12:37:25 AM
Reply

Damn, i wonder how saints row 4 will turn out. I think they already announced it right before saints row 3 released. Remember? Bigger, better, badder.

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Beamboom
Thursday, February 02, 2012 @ 3:41:52 AM

Of course I remember, and that's my main concern too. Hopefully some other company will put that IP under their wings and develop it further.

Saints Row must not die!

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___________
Thursday, February 02, 2012 @ 3:40:09 AM
Reply

tis one thing i hate about this industry.
sh*t developers who release sh*t after sh*t after sh*t like rebellion stay open for years to come, and great developers like THQs team release nothing but gold and they close down!
sigh.
no justice in this industry what so ever!

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Looking Glass
Thursday, February 02, 2012 @ 12:06:35 PM

Well to be fair it's not the industry's fault that THQ's management sucks.

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bigd7790
Thursday, February 02, 2012 @ 12:52:17 PM
Reply

Lies... My friends got laid off from the testing facility in Phoenix

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firesoul453
Thursday, February 02, 2012 @ 6:54:09 PM
Reply

I hope they pull through.

They're games wen't always that good but recently it looks like quality is going up and up!

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