Thursday 14 December 2017

'Grand Theft Auto' publisher Take-Two hikes full-year profit forecast

Popular: Grand Theft Auto
Popular: Grand Theft Auto
Grand Theft Auto game
A scene from Grand Theft Auto V

Take-Two Interactive Software, the publisher of video games such as "Grand Theft Auto", said it expects a slate of unreleased games to drive sales and raised its revenue and profit forecast for the full year.

The company's shares rose 7 percent in extended trading on Tuesday after it also reported quarterly revenue and profit way ahead of average analyst estimate, helped by the runaway success of "Grand Theft Auto V" for new consoles.

Sales of eighth-generation consoles such as Microsoft Corp's Xbox One and Sony Corp's PlayStation 4 jumped 13 percent last December, data research firm NPD said.

Take-Two's sales will be driven by new titles such as the first-person shooter game "Battleborn" and the latest versions of its "NBA" basketball game and "WWE" wrestling game, Chief Executive Strauss Zellnick told Reuters in an interview.

The company also has "high hopes from the online version of strategy game "Civilization" by designer Sid Meier, which will release next year, Zellnick said.

Take-Two raised its adjusted revenue forecast to $1.65 billion-$1.70 billion for the year ending March 31, up from $1.4 billion-$1.5 billion. It also raised its adjusted profit per share forecast to $1.65-$1.75 from $1.05-$1.30.

"It's uncomparable. No one is selling games in this volume," Daniel Ernst, an analyst with brokerage Hudson Square Research, told Reuters. "They just focus on making content that people will pay for."

The latest console version of "Grand Theft Auto V" was the fourth-most sold title in the United States last year, NPD said. The latest version was launched in mid-November.

The game, set in fictional locales, lets the user complete missions for the overall story and also engage in side activities like driving, shooting and sleeping with prostitutes.

The game has developed into a cultural phenomenon over the years, sparking a national debate on adult content and violence in video games.

"They make entertainment that people will pay for irrespective of the medium," Ernst said.

Sales from the "Grand Theft Auto" series, "NBA 2K15" and the "Borderlands" first-person shooter game franchise raked in most of the revenue for Take-Two in the third quarter ended Dec. 31.

The company, which also publishes "BioShock Infinite", got about 23 percent of revenue from digital online content.

In contrast, revenue was split almost equally between digital and physical sales for rival Electronic Arts Inc, known for its "FIFA" football game.

Take-Two's adjusted revenue jumped 24.3 percent to $954 million. Adjusted net income rose to $211.6 million, or $1.87 per share, from $210.7 million, or $1.70 per share, a year earlier.

Analysts expected a profit of $1.52 per share on revenue of $797.7 million.

Take-Two shares gained 61 percent in 2014.

Reuters

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