THQ Slumps on Poor Quarter, Outlook

The company widened its loss in the first quarter and forecasts a weak current quarter.
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SAN FRANCISCO -- Video-game publisher

THQ

(THQI)

widened its loss in the fiscal first quarter and missed analysts' expectations for the current quarter and fiscal year after it offered lower outlook.

The company posted a net loss of $27.2 million, or 41 cents a share, compared with a net loss of $9.3 million, or 14 cents a share, the year before.

Excluding items, the company posted a net loss of $25.4 million, or 38 cents a share, which was in line with analysts' expectations. A year ago, it had reported net loss, excluding items, of $6.2 million, or 9 cents a share.

Sales for the quarter rose to $137.6 million from $104.5 million the year before. Analysts had been expecting revenue of $121.11 million.

Shares of THQ was down $2.05, or 12.8%, to $14 in extended trading on Wednesday.

First-quarter sales were driven by games such as the

Disney

(DIS) - Get Report

Pixar film-based

Wall-E

, a new Wii title

Big Beach Sports

and continued strong sales of

WWE SmackDown vs. Raw 2008

and

MX vs. ATV Untamed

.

For the second quarter, THQ said it expects to report sales in the range of $160 million to $170 million and a net loss of 35 cents to 39 cents a share. Analysts are expecting revenue of $229.3 million and a loss of 12 cents a share.

For the fiscal year the company forecast sales in the range of $1.15 billion to $1.17 billion and earnings in the range of 80 cents to 90 cents a share. Analysts are looking for revenue of $1.18 billion and earnings of 99 cents a share.

THQ's weak outlook comes on the heels of larger competitor

Electronic Arts'

(ERTS)

weak results Tuesday. EA

missed analysts' estimates

for the first quarter sending it stock down nearly 6.5%. Shares of EA closed down $3.11 to $44.29.

Video games industry's newly minted powerhouse

Activision Blizzard

(ATVID)

will report its earnings Thursday though the company

pre-announced

its results earlier this month.