THQ Ups Quarterly and Fiscal Year Guidance

| About: THQ, Inc. (THQIQ)
This article is now exclusive for PRO subscribers.

Gaming software publisher THQ Inc announced higher Q3 (ended Dec. 31) and FY07 (ending Mar. 31) guidance yesterday and also said it expects to reach the $1 billion net sales milestone for FY07. THQ cited "stronger than expected sales of mass-market franchises" during the holidays "across key current and next-generation hardware systems." THQ-THQI-1yr-chart-01-11-07 Q3 diluted EPS (proforma) is now seen totaling $0.97 ($0.91 GAAP) on revenue of $475 million versus a previous estimate of $0.69 - $0.74 per share ($0.65 - $0.70 GAAP) on sales of $400m - $425m. This tops Thomson's estimate of $0.74 EPS on sales of $425m. A Lazard Capital analyst commented on THQ benefiting from its exposure to popular Nintendo platforms and noted a positive forex impact related to sales in Europe. THQ raised its fiscal Q4 diluted EPS guidance to $0.14 ($0.09 GAAP) with sales expected to be in-line with its previous estimate of $146m. Q4 results will be negatively impacted by the later release of a Sony PS3 game now due out in Q1 FY08. Fiscal '07 diluted EPS was raised to $1.20 ($1.00 GAAP) on sales of $1b, compared to prior estimates of $0.95 - $1.05 ($0.77 - $0.87 GAAP) on sales of $925m - $975m. Early this morning Kaufman Bros reiterated its "hold" rating on THQ, while raising its target to $34 from $28. THQ will report fiscal Q3 earnings on Feb. 2 before the market opens.

• Sources: THQ press release,, Reuters
• Related commentary: THQ Raises Fiscal 3Q07 Guidance: Stock May Be Negatively Affected, Gaming Software: THQ Gives Mixed Outlook, Credit Suisse Likes Activision, THQ, Inc. - How Serious Are its Problems?, Game Points: Game Console and Software Stock Update
• Potentially impacted stocks and ETFs: THQ (THQI). Competitors: Electronic Arts (ERTS), Activision (NASDAQ:ATVI), Konami (NYSE:KNM), Take Two (NASDAQ:TTWO)

Seeking Alpha's news summaries are combined into a pre-market briefing called Wall Street Breakfast. Get Wall Street Breakfast by email -- it's free and takes only a few seconds to sign up.