You hear that video games are hot, but even the companies doing it right, like Electronic Arts(Nasdaq: ERTS) and Grand Theft Auto specialists Take-Two Interactive(Nasdaq: TTWO), are hovering near 52-week lows. While Might & Magic and Tomb Raider are household brands, the companies behind the games, 3DO(Nasdaq: THDO) and Eidos(Nasdaq: EIDSY), can be found in the penny stock bin for roughly two bucks a share.

So, the game makers aren't shedding any tears after peer THQ(Nasdaq: THQI) warned of a substandard fiscal 2004 last night. Truth is, they're all cried out.

THQ publishes a wide range of games on all of the popular home-console platforms. From games featuring Viacom's(NYSE: VIA) Nickelodeon characters to the World Wrestling Entertainment(NYSE: WWE) franchise that put THQ on the map, the company had been able to license itself into some semblance of prosperity. While the company hasn't hit many out of the park since the wrestling craze died out, it's become proficient in bunt singles. But that isn't good enough these days.

In December, the company warned that holiday sales weren't up to snuff. While others had no problem moving blockbuster titles, THQ struggled. The software house was able to post higher sales in the December period, but margins got pounded, and earnings during its seasonally stronger quarter came in at just $0.41 a share. While that was in line with the company's hosed forecasts, it was well off the $0.75 a share THQ earned a year earlier.

If you're a GameCube owner, be afraid. Be very afraid. The company is calling off many of its Nintendo titles, as the console continues to fall behind market leader Sony(NYSE: SNE) and the upstart silver medalist, Microsoft's(Nasdaq: MSFT) Xbox. Last month, Activision(Nasdaq: ATVI) also weeded out some titles from its pipeline.

The company is taking a quarter off as it realigns its fiscal year to end in March. Unfortunately, it won't be the pause that refreshes. For its new fiscal year, which starts in April, THQ is looking to earn no more than $0.85 a share. That's unfortunate considering it was able to earn $1.01 a share in 2001.

The company's corporate page states, "THQ is among the fastest-growing video game publishers in the world." No, that's not quite true anymore. And what a small, small world it has become.