Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: gofrank150 who wrote (7554)	8/16/1998 10:35:00 AM
From: Kory	Respond to of 14266

Newest news from the 10Q that I saw: The JAKKS joint venture is being accounted for as an equity investment. THQ paid $2,010,000 up front for the license which is reflected in the other assets. Doesn't really give any other details about the purchase price. This $2,010,000 accounts for the jump in other assets. GameFX total cost was approx. $7.5M of which $7.2M was written off, which means that only about $300K of assets were booked. THQ plans to NOT recognize revenues and costs from the JAKKS joint venture. They instead will recognize one amount, net income or loss, and book that. Doesn't really matter from a earnings per share standpoint, but I'm sure we will get people worrying about loss of revenue and revenue growth over this. Reserve for returns still looks good, but prepaid license fees and software development costs are up quite a bit with all the games scheduled for release. Channel check: Went back and checked Granstream Saga sales at my local K-Mart. Basically none have sold over the past six weeks. Still had 10 copies on hand. Anyone else seen info on Granstream sell through? I view THQ at a crossroads right now. The have a lot of balls in the air which could propel them to a much bigger and stronger company, or leave them as a relatively small publisher. I don't view the third quarter as very meaningful one way or the other. I'm sure that THQ will again beat estimates due to the re-release of WCW/NWO and the initial shipment of several new titles. The 4th and 1st quarter of 1999 are much more interesting, and not only because the comparison for earnings is harder. Follow up sales for 3rd quarter games and 4th quarter releases will be important to see if THQ can make franchise titles out of Rugrats, BASS, Brunswick, Quest, etc. Then you have the question of whether gamers will keep buying new wrestling titles as they do with other sports (sport being used loosely). In addition, it will determine if THQ can crack the PC market, as well as make use of GameFX. I like their chances - still long and strong THQ. Kory