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The Public Financial Rise and Fall of THQ
Posted on Sunday, November 25 2012 @ 01:14:41 Eastern

This member blog post was promoted to the GameRevolution homepage.

After THQ dined and dashed out of its most recent earnings call and then defaulted (technically) on its credit facility with Wells Fargo, I became interested in the strategies and leadership that plummeted the former multi-billion dollar company down to a seven-digit market valuation that could be purchased twelve times over by Apple's 2011 contributions to charity.

But rather than consult Wikipedia or Google News, I decided to go straight to the source: the financial filings that THQ, as a publically traded company, is required to release quarterly and annually. 10-Ks, 10-Qs, Annual Reports, and earnings call transcripts were parsed together to bring you four images that encapsulate my view on THQ's historical trajectory as a public company.

This is the completely biased—yet completely factual—rise and fall of THQ, in the company's own words.

(click each image to enlarge):

The opinions expressed here does not necessarily reflect the views of Game Revolution, but we believe it's worthy of being featured on our site. This article has been lightly edited for grammar (images were created by sliverstorm). It has been submitted for our monthly Vox Pop competition. ~Ed. Nick

Comments

Lien
Joined: Feb 2008

Posted: Nov 25th, 2012 at 2:56 am
What cause that 2.4 billions dollar and 2400 total employee peak on their financial status in april 2007? Not doubting the graphs, just curious. A coincidental profitable year?

0 2

sliverstorm
Joined: Jun 2007

Posted: Nov 25th, 2012 at 9:21 am
Actually, that employee box should read 'March 31, 2008', not 2007 (you can see it's after 2008 on the graph). So great catch--I'll fix that this afternoon.

0 2

sliverstorm
Joined: Jun 2007

Posted: Nov 25th, 2012 at 9:24 am
Basically, THQ's strategy up to that point had been to ride the 'midcore'/kids licensed console games market growth without really giving much consideration to disruptive technologies. So every year that THQ made more money, they invested even more in infrastructure to push out more product, with the assumption that those markets would keep growing forever. And then the iPhone released and indie games came on the rise and the new pricing structure made kids console games look like overpriced garbage and AAA games started stealing midcore market share with increased marketing budgets and then one year too late THQ looked around and said, "uh oh, all that crap we were making that we thought would be profitable won't be--better cancel some of it and fire everyone working on it." And then they did that for 4 years straight.

0 2

danielrbischoff
Joined: Nov 2009

Posted: Nov 26th, 2012 at 10:04 am
This about sums it up. THQ should have locked up those same licenses for mobile development as well. Why aren't there a billion Nickelodeon apps on iPhone right?

0 1

tinymhg
Joined: Jun 2011

Posted: Nov 27th, 2012 at 6:09 am
@sliverstorm what do you for a living? I'd be willing to bet on statistician.

0 2

sliverstorm
Joined: Jun 2007

Posted: Nov 27th, 2012 at 5:18 pm
When I'm not slaughtering the endless hordes of Hell, I do financial analysis. I'm sorry to say that my stats knowledge falls well short of anything approaching a professional statistician--though it's definitely an area that I enjoy.

0 3

Jonathan_Leack
Joined: Jan 2012

Posted: Nov 28th, 2012 at 4:08 pm
Your blogs are AAA.

0 2