Take-Two Interactive Software has announced a downward revision of its fourth-quarter bookings forecast, reflecting concerns over sluggish demand for its gaming titles such as “NBA 2K”.
Factors contributing to the subdued performance include lower consumer spending and heightened competition from industry giants like Electronic Arts (EA) and Microsoft-owned Activision Blizzard, Reuters news report said.
Take-Two’s projected fourth-quarter bookings range between $1.27 billion to $1.32 billion. Additionally, the company revised its full-year bookings forecast to $5.25 billion to $5.30 billion, down from the earlier projection of $5.45 billion to $5.55 billion.
Analysts attribute much of the forecast cut to the postponement of a game beyond the fiscal year, minimizing its immediate impact on the company’s long-term prospects. However, investors were disappointed by Take-Two’s latest projection for fiscal 2025, expecting a boost from the anticipated release of “Grand Theft Auto VI”.
Take-Two CEO Strauss Zelnick acknowledged the challenges faced by the company, citing a 3 percent decline in net bookings to $1.34 billion in the third quarter. While games like “GTA Online” and the “Red Dead Redemption” series performed well, softness in mobile advertising and sales of “NBA 2K” weighed on overall performance.
Strauss Zelnick outlined the company’s strategy, emphasizing a focus on creativity, innovation, and efficiency. Take-Two is implementing a significant cost reduction program across its business to maximize margins while continuing to invest in growth initiatives.
Despite the setback, Strauss Zelnick expressed confidence in the company’s ability to navigate challenges and capitalize on opportunities in the online gaming market. Take-Two remains committed to delivering engaging content and driving growth through strategic initiatives.
The company’s financial report for the third quarter highlighted key contributors to net bookings, including titles such as “NBA 2K24”, “Grand Theft Auto Online”, and “Red Dead Redemption 2”. While facing headwinds, Take-Two remains resilient, leveraging its diverse portfolio to sustain growth in a competitive industry landscape.
Take-Two Interactive Software’s revenue decreased 3 percent to $1.37 billion, as compared to $1.41 billion in last year’s fiscal third quarter.
Recurrent consumer spending decreased 7 percent and accounted for 76 percent of total revenue.
The largest contributors to revenue were NBA 2K24 and NBA 2K23, Grand Theft Auto Online and Grand Theft Auto V, Toon Blast, Empires & Puzzles, hyper-casual mobile portfolio, Red Dead Redemption 2 and Red Dead Online, Words With Friends, Merge Dragons!, and Grand Theft Auto: The Trilogy – The Definitive Edition.
