THQ Inc. F4Q06 (Year ended Mar 31, 2006) Earnings Conference Call Transcript (THQI)

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2006-05-05 12:21:16.0

Tags: THQ Inc.

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Tony Gikas of Piper Jaffray, please proceed.

Tony Gikas - Piper Jaffray

Good morning, guys.

Brian Farrell

Good morning, Tony.

Tony Gikas - Piper Jaffray

A couple questions. Q1 looks a little light in light of the launch of Cars, how might that launch look, does it look any different materially compared to Incredibles or Nemo?

Second question the wireless business, it looks like the growth rate there is tempered a little bit from some expectations. Is that due to deck space, product flow, or handset sales? Then I have a quick follow-up.

Brian Farrell

Let's start with Cars, maybe Ed has something to add. We expect Cars to be a bit like Nemo where we'll get several bites of the apple. As we've been saying all along, Cars will launch here in North America in the June quarter, June 9, is the movie date, so we'll have the month of June to sell games based on Cars.

Then the movie will roll out around the world so we expect a pretty strong Q2 and Q3 on that, when we add the Nintendo Wii and the Xbox 360 version of Cars. As you know, the other products have had very, very long shelf lives so these kinds of products tend to have a long shelf life, it's not all in one quarter.

Ed Zinser

Tony, as far as how to think about it for calendarization of the quarters for fiscal '07, you might want to think about it as a 30/30/30/10 kind of a split. You'll have a little bit less in Q3 than you do in Q1 and Q2 but that's probably a way to think about it.

Tony Gikas - Piper Jaffray

Okay.

Brian Farrell

Then on wireless, as we discussed in our last call, being one of the early leaders on the wireless platform we put a lot of products out there to find out what works and what doesn't and then we've trimmed back the product line. We did that before the last call which sort of muted our expected growth this year, which is about 10%. But we expect that to accelerate next year now that we have more of those products in the pipeline.

What our strategy there is to just to reiterate, we've got a lot of the great licensed brands that work for us like WWE and SpongeBob have worked very well. Some of our original products, like Destroy All Humans! and Juiced have done very, very well, and some of the more casual products seem to do well.

 

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