THQ Blames Low Sales on Game-Console Transition

THQ Inc. of Calabasas, a maker of video game software, said it had a second-quarter loss because sales fell while players waited for new game consoles to arrive.

THQ’s loss from operations was $1.88 million, or 10 cents a share, compared with net income of $3.87 million, or 20 cents a share, in the same quarter a year earlier. Revenue fell 37% to $32.4 million from $51.6 million the year before. THQ was forecast to lose 14 cents a share, the average estimate of four analysts polled by First Call / Thomson Financial.

The company said it expects sales to rise later this year and next year with the release of the PlayStation 2 from Sony Corp., the Dolphin and Game Boy Advance from Nintendo Co., and the Xbox from Microsoft Corp.

“We anticipated a weak period during a transition to a new generation of game platforms,” said Brian Farrell, president and chief executive at THQ.

In the latest quarter, the company said a one-time charge of $5.9 million, or 31 cents a share, related to discontinued product development, resulted in a net loss of $7.77 million, or 41 cents a share.