SAN FRANCISCO (Reuters) - THQ Inc (THQI.O) reported a wider-than-expected quarterly loss, but the struggling video game publisher said it hopes to return to profitability in the current fiscal year after overhauling its cost structure.
Its shares stood largely unchanged in light after-hours trading following a drop of 4 percent shortly after its results were released.
The creator of franchises such as "Saints Row" and "WWE Smackdown vs Raw," THQ recently laid off 600 employees, or 24 percent of its workforce, and removed $220 million in costs in an effort to right-size its operations.
"They've done pretty dramatic cost-cutting... They've eliminated a lot of the marginal products," said MKM Partners analyst Eric Handler. "But it comes down to the games, and are the games going to drive revenue."
On the conference call, Chief Executive Brian Farrell called fiscal 2009 a "disappointing year" with sales falling significantly. He is looking to major upcoming releases, including "UFC" and "Red Faction: Guerrilla", to help the company turn a profit in fiscal 2010.
THQ reported a net loss of $96.9 million, or $1.44 a share, in its fiscal fourth quarter ended March 31, versus a year-ago net loss of $34.5 million, or 52 cents a share.
Excluding items such as severance expense and impairment charges, THQ posted a loss of 54 cents a share, much wider than the 32 cent average analyst forecast, according to Reuters Estimates.
Non-GAAP revenue slid 29 percent to $154.3 million, but it beat Wall Street's estimate of $145.2 million.
Sales were driven by the new releases "WWE Legends of Wrestlemania" and "Warhammer 40,000: Dawn of War II."
THQ said it was targeting profitability and positive cash flow in 2010 on net sales similar to those of fiscal 2009.
The company expects first-quarter sales to rise year-over-year, but then fall in the second quarter. Third and fourth-quarter sales are expected to be similar to last year's, THQ said.
Separately, THQ said it has signed a commitment letter for a $35 million senior secured credit facility with Bank of America (BAC.N). THQ has $141 million in cash and short-term investments.
Although THQ's shares have rebounded somewhat in recent months, the company's shares are still down around 80 percent from a year ago.
Shares of Agoura Hills, California-based THQ fell a penny in extended trading from a close of $3.91 on the Nasdaq.
(Reporting by Gabriel Madway, editing by Leslie Gevirtz and Gunna Dickson)
Source: http://uk.reuters.com/article/hotStocksNewsUS/idUKTRE54587J20090506?sp=true
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Maybe EA will buy them 
