On Thursday, Take-Two Interactive Software adjusted its fiscal 2025 revenue expectations following the announcement that Grand Theft Auto VI is set to launch in the fall of 2025.
In the wake of this news, shares of the New York-based video game publisher dipped by 2.5 percent in after-hours trading.
The company indicated that the updated launch timeline for the highly anticipated game has influenced its revenue projections. Analysts have predicted that GTA VI could quickly generate billions in annual sales.
Take-Two now estimates its bookings for fiscal 2025 will fall between $5.55 billion and $5.65 billion, a significant reduction from the previous forecast of just over $7 billion.
This conservative outlook comes on the heels of disappointing forecasts from other gaming giants such as Electronic Arts and Roblox last week.
In an effort to streamline operations, Take-Two recently laid off approximately 5 percent of its staff and terminated several ongoing projects, reflecting a broader trend in the gaming industry affected by a slowdown in consumer spending.
Despite the current challenges, the company, along with industry analysts, anticipates a rebound in bookings starting in fiscal 2025, buoyed by the release of GTA VI and upcoming titles from the acquisition of Gearbox Entertainment, the studio behind the “Borderlands” franchise.
“I estimate they could see an additional $150 million in revenue this year and potentially $300 million to $400 million in fiscal 2027,” remarked Michael Pachter, an analyst at Wedbush Securities, when discussing the revenue potential of Gearbox.
“We believe our company is well-positioned for growth, with expectations of sequential increases in net bookings for fiscal 2025, 2026, and 2027,” stated Take-Two CEO Strauss Zelnick.
Executives reported that Take-Two has a pipeline of around 40 titles planned through fiscal 2027, with 16 of those slated for release in fiscal 2025.
“With the launch of GTA VI, we anticipate significant growth in GTA Online,” added Pachter from Wedbush.
In the fourth quarter, Take-Two reported bookings of $1.35 billion, marking a 3 percent decline, though this figure exceeded the analysts’ average estimate of $1.30 billion according to LSEG data.
© Thomson Reuters 2024
