Take-Two losses top $50 million, GTAIV ships 13 million

"Unusual" costs offset Grand Theft Auto publisher's increased sales during November-January quarter; Beaterator, Borderlands, Mafia 2, BioShock 2, Red Dead Redemption, and next GTAIV expansion all due pre-Halloween.

Ever since analyst Michael Pachter upgraded his rating of Take-Two Interactive to "buy" last week, the publisher's share price has been slowly rising skyward. Just today, shares in the company rose nearly 14 percent to hit $6.85 at the closing bell--nearly $2 more than where it was when Pachter issued his prognostication.

"13 million copies? The cabaret tickets are on me, Roman!"

All that changed at about 4:30 p.m. Eastern time, when Take-Two's share price began to sink in after-hours trading. The drop was precipitated by the New York-based publisher issuing its earnings report for the November-January quarter, the first of its fiscal year. On one hand, the three-month period saw the company take in $256.8 million in revenues, a 7 percent increase from $240.4 million during the same period the prior year. On the other, losses for the quarter totaled $50.4 million ($0.66 per share), up from $38 million ($0.52 per share) the year prior.

Take-Two blamed the increased loss on stock-based compensation, bigger marketing and development expenses, and $4.9 million in "unusual" legal bills. The company did not say if the bills were related to its successful foiling of a takeover bid by Electronic Arts last year.

Of Take-Two's Nov.-Jan. revenues, some $60 million was from Grand Theft Auto games, including the blockbuster Grand Theft Auto IV. The company also announced today that the critically lauded Rockstar Games open-world crime adventure has now shipped some 13 million units worldwide on the PC, Xbox 360, and PlayStation 3. Take-Two CFO Lainie Goldstein said that international sales of PS3 and 360 versions of the game are "50/50." In the US, where the game has sold--not shipped--more than 5.5 million copies, the NPD Group shows the 360 leading the PS3 by around 1 million units.

Unfortunately, in a conference call with analysts after the report, Goldstein declined to offer sales figures for GTAIV's Xbox 360-exclusive expansion, The Lost and Damned. In the aforementioned note, Pachter estimated that the add-on has already sold 1 million units and would sell 2 million by the end of Take-Two's fiscal year on October 31.

Looking ahead to that year, Take-Two executives revealed that the Timbaland-produced PSP game Beaterator--first announced in March 2007--will finally arrive this summer. The season will also see 2K Sports release The Bigs 2 from Dead Rising 2 developer Blue Castle, followed by NBA 2K10 and NHL 2K10 in the fall. They also confirmed that Borderlands, Mafia II, BioShock 2, Red Dead Redemption, and the second GTAIV 360-exclusive expansion would all arrive before Halloween.

In terms of guidance, Take-Two expects to take in $200 to $220 million dollars in revenue during the February-April quarter, for a loss of $0.10 or $0.20 per share. For its full fiscal year, the company expects $1.1 to $1.25 billion dollars in revenues, with per-share earnings ranging from $0.00 to $0.20.

114 Comments

  • Humorguy_basic

    Posted Mar 18, 2009 6:07 pm PT

    ....Oh, and with this loss, don't expect Borderlands on PC now either, at least not this year and maybe not next...!

    Such a shame for all us PC players..!!

  • Humorguy_basic

    Posted Mar 18, 2009 6:03 pm PT

    13 million? Well, that includes the first expansion I am sure, so let's say 10 million for GTA IV and 3 million for the first expansion. That means about 1.7 million copies sold on PC (PC games sell about 17% of the total PC/Console sales nowadays.), so that's about 300-500,000 expansions to be sold on PC, if and when the expansions are available for it That brings in about $3.5 - $4 million. So PC don't help much any more. Hence bad (or let's say 'cheap') conversions and delays for the PC versions of anything. Shame really. But that's the world now.

  • condelirios

    Posted Mar 18, 2009 8:32 am PT

    I agree that they should sell it to PS3 owners, but not selling it to PC owners is REALLY stupid. The installed base of PCs is so much larger than any console... and you would think Microsoft would not want an exclusive that helps the XBOX at the expense of Windows....Seems really odd to me and bad business for Take 2. They need to forget the exclusives and sell across platforms. It has to make more money than the one time boost from an exclusive.

  • Hotwire246

    Posted Mar 17, 2009 6:19 pm PT

    world69star69:

    "...I hate M$...take 2 would not be in the red right now if they sold the gta4 dlc paks to ps3 owners! again that's millions of lost sales!"

    Well thats just wrong. They probably made a load more than they would have if they released it on PS3 because of the money they got from Microsoft to make the deal to make it a 360 exclusive.

  • george999819

    Posted Mar 16, 2009 9:47 pm PT

    Cannot wait for episodic content #2. 360 exclusive!!!!

  • J0nGalt

    Posted Mar 16, 2009 6:26 am PT

    @Tonicmole

    I'm not being sarcastic when I say this:
    You need to be hired by the White house to write the Federal budget. You understand it better than anyone there, in congress or even most people in the public. To bad Take-two mimics them, what a F'ed up company, they always have this problem. Bad management?

  • ps3thabest

    Posted Mar 13, 2009 8:57 pm PT

    Well, don't make an expensive game to real.

  • tonicmole

    Posted Mar 13, 2009 3:39 pm PT

    Well, it's just stupidity. Don't spend more then you are going to most likely make. ZINGER! I mean they maid less the same time last year then this year, yet spent more then they made. So, imagine last week you made $200, now you are setting up your budget for this week at $300. WHY!? You only made $200 last week, why would you bet on making more?

  • Ripper_TV

    Posted Mar 13, 2009 6:22 am PT

    If anything, Take-Two should bathe in money, not having big losses.

  • MisterG333

    Posted Mar 12, 2009 8:46 pm PT

    god borderlands gives me a braingasm. YES, btw, that IS a word

  • brendanhunt1

    Posted Mar 12, 2009 11:40 am PT

    ps3 owners dont forget your getting an exclusive franchise form rockstar north, i may not be gta but rockstar make the best games

  • parrot_of_adun

    Posted Mar 11, 2009 6:22 pm PT

    @"world69star69"- "whats up with all the xbots rating down any mention of the fact that they should release the gta4 dlc for ps3"

    Because you use terms like "xbot" and "M$".

    Not that I disagree about the DLC, everyone should get it, not just 360 users.

  • kellyjaye1

    Posted Mar 11, 2009 6:15 pm PT

    2nd exclusive 360 expansion for GTA4?? I knew they were set to get one exclusive back before the game even came out, never heard about 2 of them! Bring SOMETHING to the PS3!

  • world69star69

    Posted Mar 11, 2009 5:58 pm PT

    whats up with all the xbots rating down any mention of the fact that they should release the gta4 dlc for ps3....sold so many copies for ps3 yet 6+ million potential buyers can't get the dlc, becuase of M$ and it's treachery...I hate M$...take 2 would not be in the red right now if they sold the gta4 dlc paks to ps3 owners! again that's millions of lost sales!

  • parrot_of_adun

    Posted Mar 11, 2009 5:21 pm PT

    "They also confirmed that Borderlands, Mafia II, BioShock 2, Red Dead Redemption, and the second GTAIV 360-exclusive expansion would all arrive before Halloween."

    *Won't Get Fooled Again starts to play*

    Can't wait for Borderlands.

  • aslkyu

    Posted Mar 11, 2009 2:08 pm PT

    I hope Take-Two can catch a break somewhere, but they need to smarten up I think and not be at home when Mr Cock-up calls.

  • twashington9737

    Posted Mar 11, 2009 1:52 pm PT

    Well, at least, Bioshock 2 is a shoe-in sale from me and, maybe, just maybe, NBA2K10, unless Live 10 FINALLY swipes the crown, which they've already taken some steps toward doing. Just gotta get a better animation engine, though.

  • Paladin_King

    Posted Mar 11, 2009 1:48 pm PT

    Bioshock 2 by October 31? Hm, sooner than i thought.

  • brendanhunt1

    Posted Mar 11, 2009 1:27 pm PT

    @Afylan
    minus 21 thats a new record

  • brendanhunt1 posted Mar 11, 2009 1:25 pm PT (does not meet display criteria. sign in to show)

    brendanhunt1

    Posted Mar 11, 2009 1:25 pm PT (hide)

    so in terms of console sales theres more ps3 owners that own gta than xbox

  • beekayjay

    Posted Mar 11, 2009 12:43 pm PT

    Getting tired that Sony is letting MS have all of these exclusive GTA4 expansions....not that I'd even get the biker expansion if I had a 360, but if this new expansion is about Chinatown, I'm gonna flip out.

  • ReD_FeLony

    Posted Mar 11, 2009 12:33 pm PT

    jus release red dead

  • artson1966 posted Mar 11, 2009 12:03 pm PT (does not meet display criteria. sign in to show)

    artson1966

    Posted Mar 11, 2009 12:03 pm PT (hide)

    glad I sold my stock while it was up last year, I see no reason anytime soon to reinvest in this company.

  • Tybalt

    Posted Mar 11, 2009 11:02 am PT

    @PdPstyle, @FarmFreshDX:

    This not about missing projections or budget forecasts. In the latest quarter, TTWO booked ~$257m in net revenue, against ~$201m cogs and ~$106m in operating expenses. Their net loss was about $50m. For realz. They spent $50m more than they took in.

  • brendanhunt1 posted Mar 11, 2009 10:33 am PT (does not meet display criteria. sign in to show)

    brendanhunt1

    Posted Mar 11, 2009 10:33 am PT (hide)

    maybe ea should buy you out, or let rockstar north be independent

  • Link1515

    Posted Mar 11, 2009 10:18 am PT

    can't wait to get my hands on the next GTA IV DLC. The Lost and Damned was/is amazing, well worth the $20 it costs. I'm only about 60% through the story on it, and have already put in 13 hours into it. Much longer than I had expected. Also, I can't wait to play Bioshock 2--the first one was my first 360 game, and I loved every bit of it.

  • Phlakaton

    Posted Mar 11, 2009 9:52 am PT

    Gunslinger - one trick pony? They do well with Civilization, Sports, Bioshock and GTA... hardly a one trick pony of game styles to me.

  • humantree

    Posted Mar 11, 2009 9:39 am PT

    Hell yes, Bioshock 2. As someone else said, it better not be rushed.

  • jsmoke03

    Posted Mar 11, 2009 9:08 am PT

    legal fees...yikes. i wonder what they meant by developement expenses. new tech or what?

  • darthogre

    Posted Mar 11, 2009 8:39 am PT

    People still listen to the patcher guy? How many times does a guy have to get it wrong before they stop listening to him?

  • jazilla

    Posted Mar 11, 2009 8:28 am PT

    Always project low figures. That way your shareholders will always feel good about how their stock in your company is doing. Yeah, you will have to deal with people feeling a bit weary about how the company is doing, but that's when you swoop in and buy up a bunch of stock and then turn a tidy profit in the end. Then who is kicking up his feet with a stogie and a cognac? You are! Enjoy the good times friend. Enjoy them for me.

  • PdPstyle

    Posted Mar 11, 2009 8:15 am PT

    FarmFreshDx nailed it on the head. Profit in is different for corporations than what you and I may think it is/ what it is for us. The loss of profit comes from not making the projected revenues, not ACTUALLY loosing money.

  • swiftkillz0

    Posted Mar 11, 2009 8:03 am PT

    chya

  • magusat999

    Posted Mar 11, 2009 7:47 am PT

    It's the pirates that did it! The pirates are sharing and selling so many illegal copies that it's taking Take-Two under! Darned dastardly pirate thieves!

    Or at least that's what they'll be moaning at the shareholder's meeting...

  • FarmFreshDX

    Posted Mar 11, 2009 7:00 am PT

    The misleading thing about these articles is that "loss" does not mean the opposite of profit. Take-Two did not spend more than they made, they just made $50.4 Million less than they projected, so they have to change their budget.

  • King_Jeremy_77

    Posted Mar 11, 2009 6:47 am PT

    GTA all the way!

  • xbox4life76

    Posted Mar 11, 2009 6:15 am PT

    I'm like many of you and don't understand how a company can make a solid game, sell it well and bring in tons of revenue yet still have a loss...somebody is not running the books well...such great games too.

  • Arashcrysis

    Posted Mar 11, 2009 5:47 am PT

    GTA IV Your'e A Champion.History has not like you.

  • LosDaddie

    Posted Mar 11, 2009 5:21 am PT

    GTA IV was an amazing game.

  • deadliest88 posted Mar 11, 2009 4:37 am PT (does not meet display criteria. sign in to show)

    deadliest88

    Posted Mar 11, 2009 4:37 am PT (hide)

    Arghhh all Xbox exlusives :@ Money hungry greedy MF`s

  • Gamingcucumber

    Posted Mar 11, 2009 4:32 am PT

    I don't get it. They make plenty of games that win numerous awards and sell great, they have great and superb looking games in the pipeline. Yet they loose money? They are one of the few companys that actually deserve the cash!

  • Fed__X posted Mar 11, 2009 4:29 am PT (does not meet display criteria. sign in to show)

    Fed__X

    Posted Mar 11, 2009 4:29 am PT (hide)

    Guess this means DLC for PS3 please?

  • shawn7324

    Posted Mar 11, 2009 1:45 am PT

    Borderlands seems pretty good.

  • gunslingerNZ

    Posted Mar 11, 2009 12:39 am PT

    They're in trouble because they're a one trick pony. Hopefully the Houser bros new project can help bring them some diversity. Nobody wants to see Rockstar doing poorly. I don't think it makes sense to look at quarterly losses for a company like Take-Two though. Everyone knows GTA is their cash cow and funds a lot of their expenditure for the lean periods in between so I don't think this is really such a bad sign for them.

  • AOldDog posted Mar 11, 2009 12:29 am PT (does not meet display criteria. sign in to show)

    AOldDog

    Posted Mar 11, 2009 12:29 am PT (hide)

    I think that if they wanna' improve theirs sales, and this applies to any product in this crisis years, they should come up with better products.

  • AOldDog posted Mar 11, 2009 12:24 am PT (does not meet display criteria. sign in to show)

    AOldDog

    Posted Mar 11, 2009 12:24 am PT (hide)

    burn6 : No friend this means that they will release sooner that was anticipated and that ALWAYS means buggy/crappy games.

  • lil_luz_10

    Posted Mar 10, 2009 11:52 pm PT

    yeah no kidding how are they complaining about financial troubles i remember doing a current event senior year in high school about how GTA IV's PREORDERS and launch was one of the biggest launches ever and they made like 300+ million before the game even hit the shelves.

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