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

To: vc21 who wrote (6235)	6/20/1998 11:34:00 PM
From: Kory	Respond to of 14266

Cover of the new WWF Warzone title by Acclaim. latestwrestlingnews.com

To: vc21 who wrote (6235)	6/20/1998 11:35:00 PM
From: Marc Newman	Respond to of 14266

Vic, are you kidding me? Everything I've heard is that THQ is just writing off the cash paid for GameFX this quarter. When THQ says, "We're writing it all off this quarter," they just mean that the cash expense (under a million bucks) is all going under Q2. Ie, not spread over two or more quarters. The rest will be amortized. The analysts know this. Now, we do have to add in new GameFX expenses. For instance, I'd imagine that the 15 new employees will be drawing $150,000 in salary over the past two months. Plus on going development costs, etc. And THQ likely has $500,000 in Quest marketing expenses this quarter. But GameFX is only going to blunt this quarter's results, not destroy it. From everything I've heard anyway. Marc

To: vc21 who wrote (6235)	6/20/1998 11:38:00 PM
From: Sigmund	Read Replies (2) \| Respond to of 14266

Again this is how Radica did it. Not that this approach should be a guide to THQI. "As previously announced, on 30th April 1998 the Company purchased the assets of KidActive, LLC, dba Girl Tech(TM) during the quarter for $2.4 million in cash plus 190,094 shares, a total of $6 million. Of this $4.5 million has been capitalized as intangible assets and will be written off over a three year period commencing in the current quarter. The remaining $1.5 million was written off immediately as acquired research and development." It seems strange to me to write of an asset (acquired company) in the current quarter. This implies the company has no value going forward. I assume that for tax purposes it would not be possible to write off an acquisition that way. For income reporting purposes, I don't know the rules but I would find this very surprising. The company I assume would alert analysts to the treatment they will use, so if Bleeker has discussed this with analysts, he should know what THQI is planning to do.