THQ 2004 Annual Report Download - page 41

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Net sales of video games for GBA primarily increased for the fiscal year ended March 31, 2004 due to strong sales of Disney/Pixar’s Finding Nemo. Other
significant releases for the year included: SpongeBob SquarePants: Battle for Bikini Bottom, Tak & The Power of Juju, Sonic Battle and Banjo Kazooie.
The increase in net sales was also due to the higher installed base of GBA hardware compared to the same period last year. The increase in hardware
sales is due in part to Nintendo’s launch in March 2003 of the Game Boy Advance SP, which is a front-lit screen version of their GBA platform. In total
we released 33 SKUs during the current fiscal year compared to 24 SKUs in the same period last year.
We expect net sales from GBA products to continue to be a significant portion of our total net sales in fiscal 2005. The launch of new handheld
platforms (Nintendo DS and Sony PSP) may negatively impact demand for GBA and could result in decreased sales in this platform.
Sales of video games for the Nintendo Game Boy Color decreased from $20.5 million in the twelve-month period ended March 31, 2003 to $1.6 million
in fiscal 2004. The decrease in net sales was attributable to the transition to newer generation handheld systems. Although our Game Boy Color
products are playable on GBA hardware, we expect sales of Game Boy Color titles to continue to decline in the future.
PC CD-ROMS
The third factor positively affecting net sales in fiscal 2004 was sales of PC CD-ROMs. Net sales for fiscal 2004 increased 52% from the prior
twelve-month period, from $49.3 million to $74.9 million.
PC CD-ROM Net Sales
Twelve months
Fiscal Year Ended ended % change
(In thousands): March 31, 2004 % of net sales March 31, 2003 % of net sales in net sales
(Unaudited)
$ 74,934 11.7% $ 49,333 10.5% 51.9%
Net sales of our PC CD-ROM games increased for the fiscal year ended March 31, 2004 primarily due to strong current year sales of Disney/Pixar’s
Finding Nemo. Increases in net sales during the current fiscal year were also due to strong sales of Valusoft’s PC CD-ROMs. In total we released 52 PC
CD-ROM SKUs published from our ValuSoft division and 16 other PC CD-ROM SKUs during the current fiscal year compared to 51 PC CD-ROM SKUs
published by our ValuSoft division and 11 other PC CD-ROM SKUs in the same period last year.
WIRELESS
Wireless Net Sales
Twelve months
Fiscal Year Ended ended % change
(In thousands): March 31, 2004 % of net sales March 31, 2003 % of net sales in net sales
(Unaudited)
$ 6,860 1.1% $ 1,944 0.4% 252.9%
Net sales of content for wireless devices increased from $1.9 million in the twelve-month period ended March 31, 2003, to $6.9 million in fiscal 2004,
which primarily included wireless games content. We expect net sales of wireless content to increase in fiscal 2005 as we expand our product offerings
and relationships with the carriers. In addition, we have recently entered into licensing agreements with the NFL and NHL and their respective players’
associations to develop mobile content based on the teams and players of each league, renewed our license with the MLB and entered into a new license
with the MLBPA.
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THQ : 2004 : ANNUAL REPORT