What Would You Do With 1.4 Million Unsold Games?
THQ's financial troubles are well documented. The company recently announced a restructuring plan that would see it focus more on core games and digital titles and dropping its kids' licensed games.
For the third quarter ended December 31, 2011, THQ lost $56 million. Despite strong sales from Saints Row: The Third and WWE '12, the publisher took a major hit in its uDraw game business. Speaking during an investor call yesterday, CFO Paul Pucino revealed the publisher currently has about 1.4 million uDraw units that went unsold, and in total cost THQ about $100 million in revenue.
"We have about 1.4 million units still in inventory that we haven’t sold that we plan on selling," he said. THQ added that about $80 million was lost from unsold uDraw hardware while the remaining $20 million came from price cuts to units that were shipped to retail.
THQ promptly announced it was abandoning its uDraw business. “What we had viewed to be a product that would generate revenues and profits while we continued to build our portfolio of core gaming franchises has instead created a catalyst for us to evaluate our business from top to bottom," noted CEO Brian Farrell.