Take-Two reports loss, reorganizes publishing division

Grand Theft Auto publisher looks to a strong Q4 product lineup to offset losses, folds Gathering into Global Star.

Take-Two Interactive Software today released financial results for the financial quarter ending July 31, 2004. The company reported a net loss of $14.4 million, or $0.32 per share, on revenue of $160.9 million. For the same period last year, the company reported net income of $5.7 million on revenue of $152.1 million.

Also announced was a streamlining of Take-Two’s publishing operations, which were reorganized into two labels: Rockstar Games and Global Star Software. Rockstar Games will emphasize premium-priced games such as Grand Theft Auto and Red Dead Revolver, while under Global Star’s umbrella will be the ESPN sports game line and a mix of premium and value-priced licensed properties. Products from the company’s formerly PC-centric Gathering label will also be published under the Global Star brand.

The next quarter looks to be a strong one for Take-Two, with Global Star poised to release ESPN NHL 2K5 and ESPN NBA 2K5, as well as Conflict: Vietnam, the next installment in the successful Conflict series. Its highlight will be Grand Theft Auto: San Andreas, the latest version of Rockstar’s flagship franchise. The PlayStation 2-exclusive game's launch was pushed back a week to October 26 to allow for a final round of testing.

Looking ahead, Take-Two CEO Richard Roedel was optimistic, saying, “Our product pipeline going into 2005, which includes titles based on proven franchises, new brands, and licensed properties, is one of the strongest in the company's history.”

During the earnings conference call, Take-Two also introduced new personnel added during the quarter. Barbara Kaczynski, most recently chief financial officer of the NFL, was appointed to the company’s board of directors and will chair Take-Two’s audit committee. Sam Judd joined as senior vice president of planning and administration after 11 years at Viacom, and David Messenger joined as senior vice president of human resources, bringing his expertise from leading Towers Perrin’s change management practice.

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