Take-Two Profit Tops Analysts’ Estimates; Outlook Misses

Take-Two Interactive Software Inc. (TTWO) reported fourth-quarter earnings that beat analysts’ estimates, helped by sales of Grand Theft Auto video games. Its outlook for this quarter fell short and the stock declined.

Profit excluding some items totaled 21 cents a share in the three months ended March 31, New York-based Take-Two said today in a statement. Analysts projected 9 cents, the average of estimates compiled by Bloomberg.

Grand Theft Auto V was the best-selling console video game in North America, Latin America and Europe last year, shipping more than 33 million copies, the company said. During the quarter, gamers also snapped up other Take-Two titles including Borderlands 2, NBA 2K14 and BioShock Infinite.

“Grand Theft Auto continues to perform exceedingly well,” Chief Executive Officer Strauss Zelnick said in an interview. “It’s our seventh quarter of beating guidance and we guided to a very profitable year, which will be in the absence of a new release of a major new GTA title.”

Take-Two fell 1.4 percent to $20.35 in extended trading after being down as much as 6.1 percent following the announcement. The stock lost 0.2 percent to $20.63 at the close in New York and has gained 19 percent this year.

Sales for the quarter fell 23 percent to $233.2 million, after some adjustments, surpassing the average estimate of $201.6 million. In the quarter a year earlier, the company benefited from strong sales of the BioShock Infinite video-game.

Release Slate

Take-Two reported a net loss of $30.8 million, or 40 cents a share, for the quarter, compared with profit of $22.4 million, or 24 cents, a year earlier, when the BioShock title fueled gains.

Take-Two’s lineup of new releases is heavily weighted toward the holiday shopping period. This quarter, the company projects a loss of 25 cents to 35 cents a share, more than the loss of 10 cents estimated by analysts. Its revenue projection of $120 million to $135 million also was short of analysts’ estimates of $211.3 million.

For the year, the company forecasts revenue of as much as $1.45 billion, compared with analysts’ estimates of $1.37 billion, and profit of 80 cents to $1.05 a share. Analysts are estimating $1.05.

(Take-Two began a conference call at 4:30 p.m. New York time. Visit http://ir.take2games.com/ to listen.)

To contact the reporter on this story: Cliff Edwards in San Francisco at cedwards28@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net James Callan, John Lear

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