GamesBeat

Take-Two remains ‘exceedingly optimistic’ after disappointing sales of Spec Ops and Max Payne

Spec Ops: The Line

Video game publisher Take-Two Interactive (maker of Grand Theft Auto) reported that revenues for the first fiscal quarter (ended June 30) were down significantly from last year, with a net income of $226.1 million compared to $334.4 million for the first fiscal quarter of 2012.

Non-GAAP net loss was $98.8 million, or a loss of $1.16 in earnings per share (EPS). Last year in this same time period, the non-GAAP net income was $2 million, and EPS was $0.02 per share. Analysts had expected a loss of 65 cents a share for the New York-based game publisher, with revenues of $254.5 million for the fiscal first quarter.

“Although our first quarter results were below expectations due to lower-than-anticipated sales of Spec Ops: The Line and Max Payne 3, the outlook for our slate of upcoming releases is stronger than ever,” said Strauss Zelnick, the chief executive of Take-Two, in the release. “Early consumer enthusiasm suggests robust demand for our extraordinary lineup of coming releases, particularly Borderlands 2, NBA 2K13, and BioShock Infinite. We continue to expect fiscal 2013 to be one of the best years in Take-Two’s history.”

Zelnick didn’t say how many copies of Spec Ops: The Line or Max Payne 3 have sold.

“Our long-term strategy is to continue to grow our revenues and reduce the volatility of our results by complementing our console business with digitally delivered content for mobile and online platforms,” said Zelnick. “While our core console business has faced short-term cyclical headwinds, we remain exceedingly optimistic about our company’s long-term prospects for growth and profitability.”

On the conference call with analysts, chief operating officer Karl Slatoff said that the company had no updates to offer on Grand Theft Auto V or BioShock Infinite — two major releases coming in the future — but he said the development was making good progress. Grand Theft Auto V is developer Rockstar Game’s much anticipated sequel for the multimillion selling GTA franchise.

Take-Two got some revenue from the launch of its 2K Sports NBA online basketball game on the Tencent platform in China.

Looking ahead, Take-Two updated its financial outlook for its fiscal year ending March 31, 2013, with $200 to $250 million for its second quarter (ending September 30, 2012), at a non-GAAP EPS of $0.30 to $0.15. By March next year, it’s predicting $1.7 to 1.8 billion with a non-GAAP EPS of $1.75 to $2.00.

The company’s stock is at $8.78 a share in after-hours trading.


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