Yesterday after the close of market video game publisher Take Two Interactive (NASDAQ: TTWO) reported their 3rd quarter financial results.
The New York company has had a rough year. Not only have they been embattled and burdened by investigations into their options practices but in early August they announced they their premier game, Grand Theft Auto, would miss its October launch (and the holiday shopping season). The game’s arrival was pushed back into 2008. Also, in March, shareholders revolted and booted board members and management. This quarter’s earnings may be the first sign things may be improving. Buoyed in part by the sale of their game based on the Fantastic Four movie franchise they beat expectations.
Excluding legal and restructuring related charges the company lost 64cents a share. Analysts were expecting a loss of 67 cents. Revenue was $206.4m compared to $241.2 million for the same period of fiscal 2006. Take-Two’s net loss for its fiscal third quarter was $58.5 million, or 81 cents per share, compared with $91.4 million, or $1.29 per share, a year earlier. The gross profit margin for the quarter decreased to 18.5% compared to 23.7% last year
This quarter’s results were the company’s 7th consecutive quarterly net loss but looking ahead the company is optimistic about guidance for 2008.
Undersea thriller, BioShock, their newest original release, has been one of the fastest selling games in gaming history, moving more than 1.5m copies since its release August 21. Grand Theft Auto’s delay will hurt 2007 numbers but a mid 2008 release should drive solid sales. Additionally, yesterday the company announced they are jumping on the casual games bandwagon with a new label called 2K Play. A licensing deal with Viacom’s Nickelodeon is already in place.
Formally the company expects 2008 revenue to be between $1.1b and $1.4b and net earnings to come in in the range of 80cents to $1 a share. If they can meet those expectations, the may well have turned themselves around.
More detailed press coverage on Take Two’s finances can be found at: