THQ 2009 Annual Report Download - page 116

implemented a more focused ve point product strategy, and signicantly enhanced our
product development organization with the specic objectives of improving product quality
and predictability of time to market in support of our strategy.
demonstrated track record of delivering quality games and a more focused product pipeline.
In order to position THQ for protability and positive cash ow in scal 2010, we took
decisive actions to achieve our cost saving objectives and have eliminated $220 million in
planned expenditures from our FY 2010 budget. This represents $170 million in reduced
expenditures compared with fiscal 2009, and included the closure or spin-off of eight
studios and the cancellation of more than a dozen projects in development, primarily in
the highly competitive core gamer segment. In addition, we streamlined our sales,
marketing and corporate organization to support our more focused strategy. In total, we will
have reduced our worldwide staff by 600 people, or 24% of our workforce. While these
actions were difcult, we believe that we have right sized our cost structure to provide
more leverage for protability going forward.
Despite the challenges we faced in scal 2009, we made signicant progress in our
establishment of a more stringent project greenlight process. Our new team and enhanced
to drive long-term protable growth.
Over the past year, THQ has faced signicant challenges.
With the support and dedication of our employees,
growing videogame publisher.
We delivered on our product quality promise with strong Metacritic ratings of 80+ for
scal 2009 releases
and other titles. Our fiscal 2010 product
pipeline continues to emphasize our commitment to delivering high quality entertainment
for gamers. During the rst quarter of scal 2010, we launched our rst games based on
) and the rst open-world version of
franchise to strong critical (both games rated 80+) success. We expect
our upcoming fiscal 2010 releases such as
to also exemplify our product quality promise.
Our Studio System remains a key driver of future growth, with more than 1,200 THQ
employees in our product development organization, including those at eight internal
studios, as well as a network of external studios creating a strong pipeline of games.
Our award-winning Studio System and our product quality success give us confidence
in executing on our five point product strategy, which we introduced in November of
2008 to address the market trends that have unfavorably affected our business during the
current hardware cycle.
We have identied several key trends affecting our industry. The quality bar continues to
be set higher for games targeted to avid or “core” gamers and the cost to deliver this quality
has increased signicantly compared with previous hardware cycles. Growth in the kids
licensed business has slowed considerably and the business has become less protable as
consumers have shifted away from licensed content to more family and casual entertainment.
In addition, the family gaming segment is large and growing, particularly among females
and casual gamers. Lastly, more gamers are buying and playing games online.
Based on these trends, coupled with THQ’s competitive strengths, in November 2008,
we announced a more focused ve point product strategy as follows:
SENIOR MANAGEMENT
BRIAN J. FARREll
President
and Chief exeCutive OffiCer
Chairman Of the BOard Of direCtOrs
DANNy BIlSON
exeCutive viCe President,
COre Games
DOuGlAS C. ClEMMER
exeCutive viCe President;
Kids, family and Casual Games
IAN CuRRAN
exeCutive viCe President,
GlOBal PuBlishinG
WIllIAM W. GOODMEN
exeCutive viCe President,
human resOurCes
and administratiOn
JAMES M. KENNEDy
exeCutive viCe President,
Business and leGal affairs
COrPOrate seCretary
PAul J. PuCINO
exeCutive viCe President
and Chief finanCial OffiCer
STEvEN F. DAuTERMAN
seniOr viCe President,
Online
STEPhEN J. DECOSTA
seniOr viCe President,
PrOduCt develOPment
finanCe and administratiOn
MARTIN J. GOOD
seniOr viCe President,
asia PaCifiC
ROy J. TESSlER
seniOr viCe President,
PrOduCtiOn and WOrldWide studiOs
BOARD OF DIRECTORS
BRIAN J. FARREll
President
and Chief exeCutive OffiCer,
Chairman Of the BOard
Of direCtOrs thQ inC.
lAWRENCE BuRSTEIN
President
unity venture CaPital
assOCiates ltd.
a Private investment COmPany
hENRy T. DENERO
indePendent manaGement COnsultant
BRIAN P. DOuGhERTy
fOunder and Chief exeCutive OffiCer
airset, inC.
a sOftWare develOPment COmPany
JEFFREy W. GRIFFIThS
President and CeO
lumBer liQuidatOrs, inC.
a hardWOOd flOOrinG retailer
fOrmer President and CeO
eleCtrOniCs BOutiQue hOldinGs COrP.
a videO Game retailer
GARy E. RIESChEl
fOunder and manaGinG direCtOr
QiminG venture Partners
a Private investment COmPany
JAMES l. WhIMS
manaGinG direCtOr Of teChfund
CaPital i, l.P.
teChfund CaPital ii, l.P., and
teChfund CaPital eurOPe
venture CaPital firms
CORPORATE OFFICE
THQ Inc.
29903 Agoura Road
Agoura Hills, California 91301
Tel.: [phone]
Fax: [phone]
Web: www.thq.com
INDEPENDENT AuDITORS
Deloitte & Touche LLP
Los Angeles, California
REGISTRAR AND TRANSFER AGENT
Computershare Investor Services,
LLC
2 North LaSalle Street
Chicago, Illinois 60602
COMMON STOCK
NASDAQ Global Select Market
Symbol: THQI
FORM 10-K
A copy of the company’s annual report
on Form 10-K for the scal year ended
March 31, 2009 is available on THQ’s
website: www.thq.com. The report
will also be furnished upon request
directed to:
Julie MacMedan
Vice President, Investor Relations and
Corporate Communications
THQ Inc.
Tel.: [phone]
Email: [email protected]
ANNuAl MEETING
August 6, 2009 at 9:00 a.m.
The Hyatt Westlake Plaza
880 S. Westlake Boulevard
Westlake Village, California 91361
This annual report contains statements that are
forward-looking statements within the meaning
of the Private Securities Litigation Reform
Act of 1995. Such statements include, but are
not limited to, the company’s expectations for
the scal year ending March 31, 2010 and other
future periods. These forward-looking statements
are based on current expectations, estimates
and projections about the business of THQ Inc.
and its subsidiaries (collectively referred to as
“THQ”) and are based upon management’s
beliefs and certain assumptions made by
management. Such forward-looking statements
are subject to risks and uncertainties that could
cause actual results to differ materially from those
expressed or implied by such forward-looking
statements, including, but not limited to,
economic, competitive and technological factors
affecting the operations, markets, products,
services and pricing of THQ. Unless otherwise
required by law, THQ disclaims any obligation
to update its view on any such risks or
uncertainties or to revise or publicly release the
results of any revision to these forward-looking
statements. Readers should carefully review
the risk factors and the information that could
materially affect THQ’s financial results,
described in other documents that THQ les
from time to time with the Securities and
Exchange Commission, including its Quarterly
Reports on Form 10-Q and its Annual Report
on Form 10-K for the scal period ended
March 31, 2009, and particularly the discussion
of risk factors that may affect results of opera-
tions set forth therein. Readers are cautioned
not to place undue reliance on these forward-
looking statements, which speak only as of the
date of this annual report.
THQ, Vigil Games, Big Beach Sports, Company
of Heroes Online, Darksiders, de Blob, Drawn
to Life, Homefront, MX vs. ATV Reex, Red
Faction, Red Faction: Guerrilla, Saints Row,
Saints Row 2, World of Zoo and their
respective logos are trademarks and/or
registered trademarks of THQ Inc. All other
trademarks are trademarks or registered trade-
marks of their respective owners.