THQ Sales Are "Even Worse Than Feared"

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THQ Sales Are "Even Worse Than Feared"

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THQ's uDraw tablet tanked on the Xbox 360 and PlayStation 3, but analysts say that in itself isn't enough to explain the publisher's dramatic sales shortfall.

THQ cut its third-quarter sales forecast, originally announced at between $510 million and $550 million, by a stunning 25 percent yesterday, placing the blame for the slide squarely on the shoulders of the uDraw GameTablet. "Despite uDraw's strong success on the Wii in fiscal 2011 and market research indicating strong demand for uDraw on Xbox 360 and PlayStation 3, initial sales of our uDraw tablet and software on these high-definition platforms have been weaker than expected," THQ President and CEO Brian Farrell said in a statement.

It's never good when a game tanks, but analysts say that THQ has bigger problems than just a single bomb. "Management blamed poor sales of uDraw on the Xbox 360 and PlayStation 3 for the miss. However, the $130 million revenue downside suggests that there was likely some incremental weakness elsewhere," Cowen & Company declared. "At a roughly $50 for uDraw across all platforms, including the Wii, it would take a 2.6 million unit shortfall to account for the full revenue miss; THQ's planning implied less than 2.6 million units of total uDraw sell-in."

Furthermore, according to Wedbush Morgan analyst Michael Pachter, the big cut in third-quarter guidance means THQ likely won't be able to meet its financial targets for the 2012 fiscal year, making it the fourth year out of the past five that the publisher has finished with a loss. He also echoed the belief that THQ's woes go well beyond just uDraw.

"We believe sales were lower-than expected for many titles in addition to uDraw, due in large part to a pattern of mediocre reviews and a very crowded release slate for the videogame industry," he said. "Reorders were also likely below expectations as the company's release slate over the first half of the year was pretty thin apart from Warhammer 40,000: Space Marine."

Things aren't looking much better for 2013 either. "Given its declining licensed and core properties [apart from Saints Row] and an uncertain release schedule next year, we remain unconvinced that FY13 will be profitable," he said, adding that the company's cash balance could "become an issue" next year as well.

Source: GamesIndustry

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Oh well, back to the drawing board I guess.

Well you obviously didn't do enough market research then. The Wii has a different audience than the 360 or PS3. You have families buying uDraws for their kids.

RedEyesBlackGamer:
Well you obviously didn't do enough market research then. The Wii has a different audience than the PS3 or PS3. You have families buying uDraws for their kids.

sense the PS3 is so awesome it gets the right to be listed twice.

The what? I have literally never heard of this thing before. Why is there a Wiimote in that etch-a-sketch?

It was successful on the Wii? Who needs a digital etch-a-sketch?

Yopaz:
Oh well, back to the drawing board I guess.

Was that meant as a pun?

worldruler8:

RedEyesBlackGamer:
Well you obviously didn't do enough market research then. The Wii has a different audience than the PS3 or PS3. You have families buying uDraws for their kids.

sense the PS3 is so awesome it gets the right to be listed twice.

Dammit. Nice catch. It is fixed now.

Seventh Actuality:
The what? I have literally never heard of this thing before. Why is there a Wiimote in that etch-a-sketch?

The same reason the classic controller has to plug into the wii-mote, it can't send it's own wireless signal.

Yopaz:
Oh well, back to the drawing board I guess.

I see what you did there :)

OT: blaming mediocre reviews???!! try blaming the mediocre games, better games sell well and beat piracy, since games are expensive especially in the current financial climate alot of people either wait for what they know is going to be all they want it to be or they wait for a review or two to come out.

I'm thinking they should blame their marketing for this.

Seriously, how many people are aware this product even existed until now?

Well it certainly wasnt that triple AAA Homefront game, and its certainly not their fault because market research indicated strong demand for it on PS3 and Xbox360.

http://steve-yegge.blogspot.com/2008/08/business-requirements-are-bullshit.html

Yegge has a good explanation as to how "market research" is gathered and this seems like a textbook case.

Crono1973:
It was successful on the Wii? Who needs a digital etch-a-sketch?

some one at THQ seemed to think the world and his dog needed one!

Andy Chalk:

"We believe sales were lower-than expected for many titles in addition to uDraw, due in large part to a pattern of mediocre reviews

You get mediocre reviews if your games are mediocre (or as me grandad would say, shit breeds shit)

Andy Chalk:
and a very crowded release slate for the videogame industry

cause this is the first year that happened!

What the hell is a uDraw and why would I want it?

I can't even think of what kind of games would use this thing. Maybe it would be good for a Mario Paint kind of thing or as a mouse replacement for an RTS. THQ's love of Online Passes probably isn't helping much either.

RedEyesBlackGamer:

Dammit. Nice catch. It is fixed now.

aw, no problem. just thought it was a fun way to "accuse" you of fanboyism.

Chicago Ted:
I'm thinking they should blame their marketing for this.

Seriously, how many people are aware this product even existed until now?

I've seen commercials for it. Granted, the commercials still made it seem utterly boring.

I didn't know they even released that. I thought I was looking at Mario Paint.

First of all, what's uDraw? Never heard of it before. Maybe they should have invested in some marketing...

Secondly, what have they released lately that's been of any interest. Yes, Saint's Row the 3rd, but I don't think that falls under this financial report. Basically, if you want to make money, you need to make games and make sure the games are good so people buy them. Is that so hard to figure out?

Dear THQ

If your noticing a decline in sales for your properties on the PC in the UK, that's because your idiots and you don't release your games on Steam. There have been a few of your properties I was going to but this year but decided not too because you didn't put them on Steam with the preorder the bonuses that you did with the rest of the world. Once you do I MAY reconsider.

Yours

a former Customer.

PLacing all your failures on one particular deal? Sounds like a typical entertainment industry tactic.

Yopaz:
Oh well, back to the drawing board I guess.

I see what you did there.

Well duh, the problem was with the name - uDraw. If it was named 'iDraw', it would've sold bucket loads despite not being terribly necessary.

Yopaz:
Oh well, back to the drawing board I guess.

HO HOHOHOHO HOOO

Seventh Actuality:
The what? I have literally never heard of this thing before. Why is there a Wiimote in that etch-a-sketch?

Lucky you... bloody Nintendo UK, their poxy commercials drive me mad.

From the looks of it it does half the work for you, how are kids supposed to get better if they have all the work done for them?

Raiyan 1.0:
Well duh, the problem was with the name - uDraw. If it was named 'iDraw', it would've sold bucket loads despite not being terribly necessary.

How about AngryDraw?

Chicago Ted:
I'm thinking they should blame their marketing for this.

Seriously, how many people are aware this product even existed until now?

Yeah, seriously this. I'd never even heard about this. I never saw it in any game stores in the area either, and it's apparently been out since March in the EU? I just asked my roommate, and he'd never heard of it either.

THQ, your product failed because it wasn't good enough for word-of-mouth publicity and you failed to market it appropriately. It might've also suffered from poor reviews, but I almost guarantee it was shitty marketing which killed the uDraw.

The tablets cost twice as much as they should have had. I bought a high-grade professional Wacom intuos4 tablet for $125. A low-grade toy should not have cost $100.

RedEyesBlackGamer:

Chicago Ted:
I'm thinking they should blame their marketing for this.

Seriously, how many people are aware this product even existed until now?

I've seen commercials for it. Granted, the commercials still made it seem utterly boring.

Imo... HEY PARENTS, YOU WANT A COLOURING BOOK FOR YOUR KIDS THAT DOES HALF THE COLOURING FOR THEM AND NEITHER CHALLENGES OR ENTERTAINS THEM IN THE SLIGHTEST POSSIBLE WAY, FOR £60!? NO... oh okay...

Seventh Actuality:
The what? I have literally never heard of this thing before. Why is there a Wiimote in that etch-a-sketch?

I think somebody needs to go back and learn what an etch-a-sketch is again.

Yeah, well, fuck THQ.

Assholes keep closing entire studios and laying off for no damn good reason. I fucking hope they make a loss. Maybe that will convince them not to go further down that road.

Satsuki666:

Seventh Actuality:
The what? I have literally never heard of this thing before. Why is there a Wiimote in that etch-a-sketch?

I think somebody needs to go back and learn what an etch-a-sketch is again.

Yeah, I mean c'mon! etch-a-sketches are usually pink.

OT : Well that's what you get for publishing junk THQ, just look at red faction.... srsly, what the hell happened there?

I think they deserve to tank, if they keep coming out with shitty wrestling games. They're the Madden of "sports entertainment".

I've never heard of this thing, and I think THQ did a shitty job in getting the word out about this.

Also, I'm not really surprised that their sales have been down seeing as the only game that's worth getting is Saint's Row The Third. Maybe they should go and make games that are actually interesting that are not wrestling games.

I know they're going to release inSANE, maybe that will help them....?

So, they've decided not to take a stab at continuing their most successful title of the year?

Say what you will: I LOVED schpaece mahreeen. And I found it rather dissapointing when they said "no sequel, sorry, we do MMOs now."

No one has learned from countless MMO debacles.

Hey THQ, want to make money: WORK ON HOMEWORLD 3 YOU ASSHOLES!

Denamic:
What the hell is a uDraw and why would I want it?

Seems to be a PS3 graphics tablet, pretty interesting idea really. I'd probably pick one up if it hadn't had bad reviews.

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