The Conduit has definitely not flopped. I have been working for High Voltage this summer on an internship, and will likely have a permanent job there after summer. The dev team is not very large, and it is probably one of their biggest games in a very long time. Paperboy 64 was the only game that they are really memorable for in the long run, and the fact that Conduit has gotten this much success in a few short weeks is far from a flop. We probably only need to sell 200k copies for this game to turn a profit, and it will surely do so, especially with Europe not even charted yet.
I have not been informed of the budget that this game has had, but it has not been a huge budget title (for the company, i suppose it has). Mr Ganofsky is proud of it's success I'm sure.