Take-Two hit by net losses, game delays, weaker forecasts

The record-breaking success of GTA IV has finally boomeranged on publisher Take-Two, with the company reporting a second-quarter profit loss which feebly compares to its market triumphs a year ago.

The New York City-headquartered publisher has posted a net loss of $10.1m for the second quarter ending April 30, a figure which is shadowed by a profit of $98.2m the year prior. It means that first-half net losses have grown to around $60m.

Take-Two is more than aware of the pulling power of GTAIV, and orchestrated the reporting of its losses in time with Rockstar’s announcement of The Ballad of Gay Tony, the next 360-exclusive downloadable episode of the game.

That title is expected to bolster Take-Two’s performance in the fourth quarter, yet the firm’s prospects have been stung by the announcement of two delays.

As reported on Develop, Take-Two will delay the release of Red Dead Redemption and Mafia II until first half of FY10, claiming that more development polish is needed for both.

Year-on-year revenue sunk 57 per cent to about $230m, though this outperformed Wall Street forecasts at $216m. Sales were driven by Major League Baseball 2K9 as well as the GTA franchise in the guise of DS title Chinatown Wars, sustained sales of GTAIV, and help from the first 360 DLC episode Lost & Damned.

The publisher nevertheless continued to forecast a profit for the whole fiscal year, which ends October 31, though it lowered its revenue forecasts to a range of $1.05-1.15bn; down from previous projections of $1.1-1.25bn.

Take-Two Chairman Strauss Zelnick, speaking to Reuters, said that he was encouraged by the publisher’s results.

I think our view is hat the economy may be starting to stabilize,” he said.

I don’t think we’re getting any great benefits from an economic rebound, that would be utterly premature but I’m feeling a bit more optimistic. Conditions are not getting worse.”