'Grand Theft Auto' creator forecasts disappointing sales, shares drop
(Reuters) -Videogame maker Take-Two Interactive Software Inc on Monday forecast second-quarter adjusted sales below estimates and pushed back the release of two titles, dragging the company's shares nearly 3% lower aftermarket.
The "Grand Theft Auto" and "Red Dead Redemption" creator also maintained its annual revenue forecast and did not reveal which games were being delayed, but said the pandemic played no role in its decision to move the release.
Earlier this year, Take-Two staved off investor concerns over a stagnating pipeline by unveiling plans to deliver over 40 titles across fiscal 2023 and 2024.
But its shares have still tanked about 17% this year, after a surge in gaming during the pandemic drove a 70% leap in 2020.
Companies like Take-Two, Electronic Arts and Activision Blizzard benefited from lockdowns keeping gamers glued to their consoles last year, but those gains have started to taper off as easing pandemic curbs encourage people to step out more.
Take-Two forecast second-quarter adjusted revenue between $815 million and $865 million, below analysts' estimates of $890.7 million, according to Refinitiv IBES data. Its full-year adjusted sales forecast was maintained at between $3.2 billion and $3.3 billion, versus $3.55 billion in fiscal 2021 and estimates of $3.47 billion.
"We are reiterating our outlook, as there has been some movement in our release schedule, including two of our immersive core titles shifting to later in fiscal 2022 than contemplated by our prior guidance," Take-Two said in a statement.
Chief Executive Officer Strauss Zelnick told analysts that the company needed more time to "polish" the titles.
On an adjusted basis, the game publisher posted first-quarter revenue of $711.4 million, beating estimates of $687.6 million.
(Reporting by Tiyashi Datta in Bengaluru; Editing by Devika Syamnath)
