THQ reaffirms strong Christmas sales forecast

Videogames publisher THQ has issued a statement reaffirming its positive Christmas period sales forecasts, hoping to stem any further fall in share prices following EA's warning on Wednesday.

For the third quarter of its 2006 fiscal period, which includes the all-important December sales, THQ forecast net sales of approximately USD 320 million and net income of about USD 0.65 per diluted share. Some analysts are predicting a marginal increase in these figures, and THQ is expected to post its full fiscal results for the period at the end of January or early February 2006.

Brian Farrell, THQ president and CEO said: "Our strategy to target the mass-market consumer this holiday and launch our core gamer titles for the next-generation platforms next year as the installed base ramps is working. Our WWE SmackDown vs. Raw 2006 title is performing very well on both PlayStation 2 and the PSP. In addition, new titles targeted to kids and family such as The Incredibles: Rise of the Underminer, our Nickelodeon products, Bratz Rock Angelz and our catalogue of value-priced games are on track."

There have been numerous reports of poor sales in the run up to Christmas this year, both in the US and European territories. Publishers including Ubisoft and Activision have instigated aggressive price-cutting tactics on premium titles in a bid to stimulate further sales, which could have a negative impact on profits for the quarter.

Electronic Arts issued a warning to the stock market on Wednesday, indicating that it will miss its previous estimates for the quarter and suggesting that the slump is not limited to the pre-Christmas period. Activision also recently lowered its forecasts for the Christmas period, resulting in a drop in share price.

THQ's statement remains determinedly positive however, and stock price in the firm showed a marginal increase following its release.