Topps announced its fiscal third quarter earnings Wednesday, and results were marred by a $3 million loss in the quarter at new subsidiary WizKids. According to the announcement, the WizKids loss was, '...mainly from the unsuccessful new product launch of Creepy Freaks and, to a lesser extent, costs associated with sales weakness in general.' Topps earned $982,000 in the quarter, vs. $2.9 million in the year-ago period (prior to the WizKids acquisition).
Creepy Freaks, a gross-out game directed at a young target market (see 'WizKids Announces Kids Gross-Out Game') tanked despite TV advertising and promotional support (see 'Dannon, TV Ads Promote Creepy Freaks').
Topps Chairman Arthur Shorin promised changes at WizKids to reverse the trend. '...Steps are being taken to improve performance, reduce costs and more effectively manage risk associated with new game releases.' The parent company is a lean, well-run company that works hard to manage risks in difficult, fad-driven businesses. Expect some of that expertise to be applied at WizKids.
One possible target may be WizKids' publishing division, formed last year (see 'WizKids Forms Publishing Division'), which we've heard may be going under the knife. WizKids did not respond to requests for comment on the publishing division rumors.