THQ Sales Climb on ‘Nemo’ Title

THQ Inc., the third-largest video game publisher, posted higher revenue and a narrower loss Thursday, crediting buoyant sales of its “Finding Nemo” title.

THQ sales jumped to $98 million in its fiscal first quarter, up 14% compared with a year earlier, with “Finding Nemo” constituting about one-fifth of the Calabasas company’s revenue. A net loss of $3.6 million, or 9 cents a share, beat Wall Street estimates by a penny.

Its shares gained 43 cents to $17.95 on Nasdaq, but fell to $17.70 in after-hours sessions after the earnings announcement.

THQ, which makes games based on the “SpongeBob SquarePants” and WWE wrestling franchises, is revamping its lineup to include fewer and better games aimed at the holiday season.

That strategy paid off for “Finding Nemo.” THQ shipped more than 1 million units of the game in North America. The company said it expected the title to continue to sell well as it rolls out the game internationally in the fall alongside Pixar Animation Studios’ foreign release of the movie.

But the new strategy means higher costs.

“Clearly, as we focus on making better titles, we are spending and investing more in our top brands,” said THQ Chief Executive Brian Farrell, who said the company was spending roughly one-third more to develop top-tier games.

For the current quarter, THQ projected sales of $120 million and earnings of 8 cents a share, compared with $97 million in sales and 12 cents a year earlier.