Take-Two Interactive Software has projected fourth-quarter bookings that fall short of market expectations and has revised its annual estimates downward, signaling a decline in consumer interest in its gaming titles, including NBA 2K. This announcement led to a 10 percent drop in the company’s shares during after-hours trading.
The video game publisher is facing challenges due to decreased consumer spending and heightened competition from rivals like Electronic Arts and Microsoft-owned Activision Blizzard.
The company anticipates fourth-quarter bookings between $1.27 billion (approximately Rs. 10,542 crore) and $1.32 billion (around Rs. 10,957 crore), while analysts had expected bookings to reach $1.51 billion (about Rs. 12,534 crore), according to data from LSEG.
Additionally, Take-Two has adjusted its forecast for full-year bookings to a range of $5.25 billion (approximately Rs. 43,578 crore) to $5.30 billion (around Rs. 43,993 crore), lowering it from the previous projection of $5.45 billion (about Rs. 45,239 crore) to $5.55 billion (approximately Rs. 46,069 crore).
Wedbush securities analyst Michael Pachter noted that the forecast adjustment is primarily due to the postponement of a game release into the next fiscal year, suggesting it won’t significantly affect the company’s long-term outlook.
However, Take-Two’s current estimate of slightly over $7 billion (approx. Rs. 58,105 crore) for net bookings for fiscal 2025, especially following last year’s downward revision to below $8 billion (approximately Rs. 66,406 crore), has disappointed investors.
Market participants had been optimistic about potential gains from the much-anticipated Grand Theft Auto VI, the newest entry in the popular franchise set to launch in 2025.
Pachter added that the reduced outlook implies that Grand Theft Auto VI will not be released in the upcoming fiscal year.
Third-quarter Results
In the third quarter, Take-Two reported a 3 percent decline in net bookings to $1.34 billion (around Rs. 11,122 crore), aligning with analysts’ predictions.
The positive performance of titles such as GTA Online and the Red Dead Redemption series was somewhat balanced out by weaker results in mobile advertising and NBA 2K sales, according to CEO Strauss Zelnick.
On an adjusted basis, the company reported earnings of 71 cents per share, slightly below the analysts’ expectation of 72 cents.
