Sad news isn’t that exciting to read, but it does exist and acts as an important reality check in the jungle of AAA titles that are hitting us this fall and winter. Only a few days ago it became known that Avalanche Studios was laying off 77 employees due to some poor business deals and a wobbly economy. Now Saints Row 2 producer THQ say they are letting 250 people leave the company. Why? Because sales figures didn’t match their expectations.

THQ has also confirmed that they’re closing five studios and canceling a number of titles in development. Net sales for July to September were down to $164.8 million compared to $229.3 million last year. Besides laying off staff, THQ has some other solutions to fix their result drop. Their main focus will be to narrow the development to fewer titles but also to start up a new studio in Asia. THQ announced that they will launch Dragonia, a free-to-play MMO, in 2009 as part of a joint venture with ICE Entertainment, based in Shanghai.

“We are aligning our business to be more competitive in key consumer segments and address the current business environment,” said THQ CEO Brian Farrell.

“We expect the combination of a much more focused and competitive product line with a more efficient cost structure to put THQ back on the path to growth and profitability in fiscal year 2010.”

Well, there’s actually another ace up THQ’s sleeve. If their suit against Activision Blizzard goes as planned, it’s a great source of income to stop the bleeding with. If THQ comes out unlucky in that battle, it simply depends on your will to buy some THQ titles. Yeah, there you have it - my judgemental finger pointing at you. With more effort being put on fewer quality titles there’s a chance that THQ will actually earn those crucial extra dollars.