Take-Two earnings and outlook beat Wall Street estimates of strong holiday quarter

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Take-Two Interactive Software Inc. reported a better-than-expected outlook and results Monday night as sales surged during the COVID-19 pandemic, and said it was leaving behind its bid to acquire the game publisher of UK based careers, Codemasters. On Monday night, Take-Two TTWO, + 2.82% reported fiscal third quarter net income of $ 182.2 million, or $ 1.57 per share, compared to $ 163.6 million, or $ 1.43 per share, in the period of the year. previous.

Revenues decreased to $ 860.9 million from $ 930.1 million in the prior year quarter. Analysts surveyed by FactSet had forecast $ 1.12 per share on revenue of $ 757.5 million. Take-Two forecast earnings of 88 cents to 98 cents per share on revenue of $ 702 million to $ 752 million for the fourth quarter, and $ 4.08 to $ 4.18 per share on revenue of $ 3.24 billion to $ 3.29 billion for the year. . Analysts had estimated 59 cents a share on revenue of $ 584.1 million for the fourth quarter and $ 3.69 per share on revenue of $ 3.29 billion for the year. Take-Two publishes franchises such as “Grand Theft Auto” and “Red Dead Redemption” under its Rockstar Games label, and “Borderlands” and “NBA2K” under its 2K label. Even with the strong results and outlook, the stock fell 4% after hours, following a 2.8% gain in the regular session to close at $ 213.14. In January, Take-Two dropped its bid for Codemasters CDM, + 0.33% after Electronic Arts Inc. EA, + 0.88% bid more for the UK-based racing game publisher. “We lost the Codemasters deal with our friends in the west,” Strauss Zelnick, Take-Two CEO and chairman, said on Monday’s conference call. “That was disappointing, but it reflects our discipline on such matters.” “We are joining the 2K and Rockstar teams as they work on more properties and larger properties,” Strauss said, noting that the company’s focus is on increasing production and engineering positions. “We have shown a willingness to acquire companies, and to add in that way too, very, very selectively.” Additionally, on Monday night, EA announced that it would buy Glu Mobile Inc. GLUU, + 2.18% for $ 2.4 billion. On the mobile gaming front, Take-Two acquired Playdots for $ 192 million in August and developer Social Point for $ 250 million in 2017, which Take-Two president Karl Slatoff said in the call he gave Take. -Two “quite a sizable platform” in mobile games. In recent years, mobile games have been the fastest growing platform in the video game industry, accounting for roughly half of the roughly $ 180 billion in sales in 2020, while PC and console games make up the other. half, according to IDC data. Over the past 12 months, Take-Two shares are up 89%, while iShares Expanded Technology-Software Sector ETF IGV + 0.21% is up 47%, the S&P 500 SPX index , + 0.74% is up 18%, and the Nasdaq COMP, + 0.95% is up 47%. Last week, EA shares fell back from a record close after the video game publisher reported quarterly results that fell short of Wall Street expectations, while Activision Blizzard Inc. ATVI, shares of -0.41% fell. fired after the results. For its part, EA shares have risen 31% in the last 12 months, while Activision Blizzard shares have risen 64%.