CC Notes
No mention of MPRS
Q2 sales mix by platform:
59-60% N64
25% PSX
16% GB
Outlook for the entire year:
50% N64
36% PSX
9% GB
5% PC
23% of Q2 sales were international
DSO= 45
Inventory at a rate of 43 turns/year
Nintendo asked THQ to participate in its Player's Choice program (similar to Sony's greatest hits), wherein Nintendo spends $4 million (not sure if this is total, or just for THQ) in marketing for a re-release of WCW vs. NWO. THQ had planned to release this title in Q4, but now with Nintendo helping out, THQI will release it in Q3 at a wholesale price of $33, compared to what had originally been a wholesale price of $40-45 (my estimate). As a result of THQ's rerelease of NWO in Q3, WCW/NWO Revenge 64 will be pushed out to Q4.
Other product shifts:
Shao Lin- pushed to Q1 99 from Q4. THQ wants to avoid the busy clamor of Q4, and develop a strong marketing promo for Shao Lin. It sounds like THQ really sees this title as a big winner, so they want to spend time establishing its name among the gaming community.
International Rally (PSX & PC) is now Q4.
I need to find out about WCW Nitro 64 (which Inland claims will be ready by October). I suspect that it will either be canned or released in Q1. That could be tricky.
A Bug's Life will be colorized for the Color Gameboy. THQ will try to have Rugrats ready for color, but no guarantees.
There have been some reorders of Quest 64 in Q3.
Guidance for 2nd half of year. Not surprisingly, Farrell said that he is comfortable with Q3 and Q4 earnings. He sees nothing right now that suggests that estimates need to be raised, but as visibility increases, he'd like to revisit the estimates. Every analyst commented about THQ's continuing blowing away of estimates. It remains to be seen how much estimates go up. As it stands right now, 1998 estimates should be raised to $2.27 fro $2.09, accounting for the upside in Q2.
33-34% tax rate in Q3-4.
THQ is considering a GameFX version of BASS Masters Classic for 1999, with photo-realistic pictures. Development costs won't be extremely high, because they will use the existing GameFX engine. I suspect this title would be PC-based. But the nature of the Dreamcast allows for porting from PC.
Piper Jaffray was the only other analyst aside from the old favorites. No Bear Stearns.
I need to rework my estimates, since it seems that guidance on the CC was somewhat different than the guidance I had received from the company.
I suspect that in Q2, shipments (using net sales figures-obviously the actual shipments were higher) went as follows:
90 Granstream
115 Nitro
350 Quest
85 NWO
235 FIFA GB
Todd |
