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Take-Two Interactive Software Inc. shares fell in the extended session Monday, after the videogame publisher’s bookings results and forecast fell below Wall Street estimates.
Take-Two
TTWO,
shares declined as much as 5% after hours, following a 0.1% gain in the regular session to close at $175.10.
For the fiscal third quarter, Take-Two reported net income of $144.5 million, or $1.24 a share, compared with $182.2 million, or $1.57 a share, in the year-ago period. Revenue rose to $903.3 million from $860.9 million in the year-ago quarter, while net bookings rose to $866.1 million from $814.3 million in the year-ago quarter.
Analysts expected Take-Two to report third-quarter unadjusted earnings of 79 cents a share and adjusted earnings of $1.12 a share on revenue of $870.1 million and bookings of $868.4 million. Back in November, Take-Two had forecast unadjusted earnings of 85 cents to 95 cents a share on revenue of $840 million to $890 million, and net bookings of $800 million to $850 million.
“From investing in talent to acquiring some of the industry’s leading creative studios and announcing our transformational agreement to combine with Zynga, we are taking exciting steps to diversify our business, gain market share and enhance our positioning as one of the world’s top three pure-play publishers of interactive entertainment,” said Strauss Zelnick, Take-Two’s chairman and chief executive, in a statement. “Together with our incredible pipeline of new intellectual properties and eagerly anticipated sequels, we are confident that we are positioning our business for long-term success and shareholder value creation.”
Read: The pandemic boom in videogames is expected to disappear in 2022
Take-Two forecast unadjusted fiscal fourth-quarter earnings of 46 cents to 56 cents a share on revenue of $835 million to $885 million and bookings of $808 million to $858 million. Analysts surveyed by FactSet had forecast GAAP earnings of 71 cents a share and non-GAAP earnings of $1.15 a share, revenue of $911.9 million, and bookings of $924.9 million.
For the year, Take-Two forecast unadjusted earnings of $3.10 to $3.20 a share on revenue of $3.41 billion to $3.46 billion and bookings of $3.37 billion to $3.42 billion, compared with its previous forecast of $2.75 to $3 a share on revenue of $3.35 billion to $3.45 billion and bookings of $3.3 billion to $3.4 billion for the year.
For the year, analysts forecast GAAP earnings of $3.31 a share earnings, non-GAAP earnings of $4.87 a share, revenue of $3.5 billion, and bookings of $3.45 billion.
On Friday, Take-Two’s Rockstar Games studio confirmed speculation that it was starting development on the next iteration of “Grand Theft Auto,” ostensibly, “GTA VI,” which analysts have estimated could be out as early as the spring of 2023.
Take-Two publishes such videogame franchises as “Grand Theft Auto” and “Red Dead Redemption” under its Rockstar Games label, and “Borderlands” and “NBA2K” under its 2K label.
Also, in January, Take-Two announced it had offered $12.7 billion to acquire Zynga Inc.
ZNGA,
in a cash and stock deal. Zynga is scheduled to report earnings on Wednesday.
Other videogame publishers have already reported holiday earnings. Electronic Arts Inc.
EA,
forecast slower-than-expected growth in its earnings report last Tuesday, while Activision Blizzard Inc.
ATVI,
reported a ‘disappointing’ earnings last Thursday with Microsoft Corp.’s
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$69 billion offer for Activision Blizzard likely cushioned any blow there.
Over the past 12 months, Take-Two shares have fallen nearly 16%, while Activision Blizzard is down nearly 22% and EA shares are off 3.4%. In comparison, the iShares Expanded Tech-Software Sector ETF
IGV,
is down 7.4%, the S&P 500 index
SPX,
is up more than 15%, and the tech-heavy Nasdaq Composite Index
COMP,
is up 1.2%.
