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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Jim Oravetz who wrote (13730)	4/9/2000 1:41:00 AM
From: Marc Newman	Read Replies (1) \| Respond to of 14266

<<While Smackdown appears to be selling well, there does seem to be early significant price reductions already in place for it -- $15.95ea per my recent post. Profits margins will suffer. Maybe this "new pricing" structure was developed to keep kids buying while more powerful consoles wait in the wings for en-mass deployment.>> Hi Jim, I'm happy to say that you are totally mistaken about Smackdown here. Wildly so. That $15.95 price is either bogus or some sort of loss leader from an internet company burning through its last $50 million or else selling counterfeit cds. What matters is the TRSTS data which consistently shows Smackdown's average retail selling price at 80% of the domestic market to be $40 or $41. And the other important game, Wrestlemania 2000? $60 solid. It has been $60 since its release 4.5 months ago, except for one week when Target had a co-op sale and the avg. ASP dropped to $58. THQ is getting the margins for these products that it expected. But sales are better than expected. If you visit the stores you'll see that in most cases THQ's B titles have not suffered from severe markdowns either. Most N64 titles are still around $50. GBCs are $30, PSX titles are $40 or more. Rugrats Studio Tour is the exception. It's generally $30 now. I'm thinking we see a Smackdown pr on Monday and if that "works" at all, we see the Tomb Raider GBC announcement on Tuesday. As Todd Fender has noted, industry sales are actually up in Jan. and Feb. The problem is that there are more titles, plus a lot of money goes to Nintendo and Sony of course. But the industry is doing well, even if individual companies are struggling. And in some cases one wonders if they (ATVI and THQI?) are just slimming themselves down for takeovers later this year? Another example is the fact that a bidding war has just broken out for Funco. Barnes & Noble just raised EB's bid by almost 25%. Imagine what would happen in this sector if a DIS or MSFT or Viacom or ERTS suddenly swallowed one of the smaller 3rd parties. THQ would probably be at $30 in a flash. Marc