State-of-the-art gaming company at home in Calabasas





By Sylvie Belmond
belmond@theacorn.com

WWE SmackDown! vs. Raw, a PlayStation 2 video game, and The Incredibles, a recent movie-to-video game crossover, are expected to keep Calabasas-based THQ Inc. in the forefront of the gaming industry.


"Our holiday 2004 drive titles are based on some of the biggest brands in entertainment, including three of the most highly anticipated theatrical releases of the season," said Brian Farrell, THQ president and chief executive officer.


THQ, a state-of-the-art gaming company that develops and publishes  interactive entertainment worldwide, employs 343 people in Cal-abasas and 1,124 worldwide and is still growing. Its products are geared to every segment of the expanding gaming audience.


THQ makes games for all gaming systems and computers, including PlayStation 2, Microsoft Xbox, Nintendo Gamecube, Game Boy Advance and PCs, said Liz Pieri, a THQ spokesperson. "We are also planning games for the new handheld systems—Sony PSP and Nintendo DS—as well as games for Microsoft and Sony’s new console systems," said Pieri. The company’s titles span most major interactive entertainment software genres, including action, adventure, children’s, racing, fighting, puzzle, role-playing, simulation, sports and strategy.


Although THQ is primarily a game company, its wireless group also publishes ring tones, wallpapers and other applications. As the ever-expending cellular market grows, THQ Wireless, the company’s wireless games group, also develops and publishes games and other entertainment applications for mobile devices.


The company, founded in 1990, has a fiscally promising future, according to the the website. The company is publicly traded and listed on the Nasdaq as THQI. In early November, THQ stock sold at nearly $20 per share; the 52-week high is $23.27. As of June 30, 2004, THQ had a solid balance sheet of $267 million in cash and investments and zero debt.


THQ just renewed key long-term license agreements with Pixar and Nickelodeon, according to the website. The holiday season also promises good revenues because sales of games based on popular movies show a lot of potential. Some of the newest games developed and published by THQ include, in addition to WWE Smackdown! vs. Raw and The Incredibles, The SpongeBob SquarePants Movie, The Polar Express and the latest Warhammer.


"We have a strong record of delivering profitability and revenue growth and are very confident in our future prospects," said Pieri. For the six months ending in September 2004, THQ reported net sales of $184.5 million and a net loss of $10.3 million, or $0.27 per share. In the corresponding prior-year period, with significantly more new product releases, THQ posted net sales of $224.6 million and net income of $32,000, or $0 per diluted share.


The Calabasas facility handles business development, legal, licensing, marketing, sales, operations and financial functions, but the company has many of those capabilities in other offices as well, said Pieri. "We also operate our quality assurance group and wireless games subsidiary out of Calabasas," said Pieri.  The games themselves are developed at external studios, the closest of which is in Los Angeles. "We do our own PC manufacturing, but Sony, Microsoft and Nintendo manufacture our games for their systems," said Pieri.


THQ has offices in the UK, France, Germany, Australia, Korea and Spain and it also has development studios in Vancouver, Seattle, San Jose, Los Angeles, Phoenix, San Diego, Champaign, Ill. and Lexington, Mass.


For the past several weeks, two picketers have been standing in front of THQ in Calabasas holding a banner that says, "Shame on THQ." But this dispute is not directly related to THQ. "It’s a dispute our landlord in Phoenix (where Rainbow Studios is) is dealing with because he is using a non-union drywall company," said Pieri. 



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