Take-Two Interactive Software Inc., the maker of “Grand Theft Auto V,” fell the most in 18 months after the video-game company’s forecast for the current quarter fell short of analysts’ estimates.
The shares slid 9.7 percent to $17.06 at the close in New York, for the biggest decline since August 2012. The stock rose 58 percent last year.
Take-Two projects breakeven to 10 cents a share in profit for the fiscal fourth quarter, on an adjusted basis, according to a statement yesterday. That’s less than the 13-cent average estimate of analysts. Revenue is forecast at $170 million to $200 million, compared with the $215.6 million average seen by analysts. Take-Two also reported third-quarter profit that beat analysts’ estimates, helped by sales of “Grand Theft Auto V.”
Take-Two has shipped about 32.5 million copies of the latest installment of the most popular game, since its release on Sept. 17. That helped the company rank No. 1 among U.S. game publishers last year, according to NPD Group Inc. Still, industry software sales are shrinking as consumers shift to new PlayStation 4 and Xbox One consoles from Sony Corp. and Microsoft Corp.
“Strong results during the December quarter with mixed March quarter guidance could suggest” the online version of GTA “is not monetizing at as high a rate as some expected,” Michael Olson, an analyst at Piper Jaffray Cos., said in an e-mailed note. Olson has an overweight rating on the stock, the equivalent of buy.
Chief Executive Officer Strauss Zelnick said the company isn’t seeing a slowdown in sales of games made for the older Microsoft Xbox 360 and Sony PlayStation 3 consoles. The company will continue to post strong sales, physically and in digital format, he said in an interview yesterday.
“We’re highly confident with our outlook to be profitable in the next year, and that’s attributable to the company’s strategy of being the most creative, the most innovative and most efficient company in the business,” he said.
Take-Two said it has more than 10 titles in development for the new game machines from Microsoft and Sony, including “Evolve,” a multiplayer monster game scheduled for release in the fall.
Profit excluding some items more than doubled to $210.7 million, or $1.70 a share, for the quarter ended in December, New York-based Take-Two said yesterday in a statement. That beat the $1.42-a-share average estimate of 15 analysts, according to data compiled by Bloomberg.
Revenue from digitally delivered content grew 42 percent from a year ago to $132.8 million, Take-Two said. Almost half of that revenue came from spending on virtual currency, add-on content and online gaming.
Net sales on an adjusted basis were $767.7 million, ahead of the $705.2 million estimated on average by analysts.
Take-Two reported net income of $578.4 million, or $4.69 a share, compared to $71.4 million, or 66 cents, a year earlier.
In November, Take-Two said it repurchased all shares held by activist investor Carl Icahn, ending his four-year involvement with the company.