For its upcoming third-quarter report, THQ expects to see $475 million in top-line revenues, and diluted earnings of approximately $0.91; this includes the effect of stock compensation, which the company has experienced some issues with recently -- a press release issued earlier in the week explains the results of an investigation, which won't have a significant material impact going forward. The old third-quarter guidance called for revenues to be only as high as $425 million, with diluted earnings coming in between $0.65 and $0.70. For the full fiscal year, THQ is looking at a cool $1 billion of sales revenue and an even $1 of diluted earnings per share. Previous guidance stated that revenues would be, at best, $975 million, translating to a diluted-earnings range between $0.77 and $0.87.
The fiscal fourth quarter, however, won't be receiving a boost. The revenue guidance issued at the beginning of November predicted a revenue range between $145 million and $170 million; revenue guidance is now focused on the low end of that range, at $146 million. Earnings per diluted share are expected to be about $0.09 as opposed to, at minimum, $0.13. What caused the weaker outlook? Blame it on a shift in the company's release schedule -- a game slated for Sony's
That's OK, though, because the main thing to focus on here is the upward earnings revision. THQ isn't lying when it says that its licensing strategy is working. Disney's
THQ, along with Activision
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Fool contributor Steven Mallas owns shares of Activision and Disney. As of this writing, he was ranked 3,579 out of 19,594 investors in the CAPS system. Don't know what CAPS is? Check it out. Microsoft is an Inside Value pick. The Fool has a disclosure policy.