Sunday 22 January 2017

'Grand Theft Auto' maker Take-Two's revenue jumps 31pc

Anya George Tharakan

Published 03/11/2016 | 09:21

Red Dead Redemption
Red Dead Redemption

Videogame publisher Take-Two Interactive Software Inc reported a 31.4pc rise in adjusted revenue, driven by strong demand for "NBA 2K17", the latest version of its popular basketball franchise, as well as higher downloads of its games.

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The company's shares were up 5pc at $47 in after-market trading on Wednesday.

Take-Two, like rivals Electronic Arts and Activision Blizzard, has in recent years benefited from a shift to the high-margin digital business, where players download games rather than buy physical game discs.

Adjusting for deferrals, net revenue rose to $479.4m from $364.9m in the second quarter ended Sept.30, beating the average analyst estimate of $402.6m, according to Thomson Reuters I/B/E/S.

Take-Two forecast current-quarter revenue of $675m to $725m, compared with the average analyst estimate of $649.7m.

However, the company's net income fell to $36.4m, or 39c per share, from $54.7m, or 55 cents per share, a year earlier.

Take-Two said selling and marketing expenses jumped 46.1 percent in the quarter.

The company confirmed earlier this month that it would release a new "Red Dead" videogame in the second-half of 2017, after teasing the return of the Western action-adventure series on social media.

"We have very high hopes for the project," Take-Two Chief Executive Strauss Zelnick said in an interview.

"Red Dead Redemption 2" should be one of 2017's biggest releases, Wedbush analyst Michael Pachter said in a pre-earnings note, adding that the game positions the company to deliver profits for the foreseeable future.

The new "Red Dead" game will be released by Take-Two's Rockstar Games studio, best known for creating the popular "Grand Theft Auto" franchise.

Reuters

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