August 5, 2019 / 8:17 PM / 3 months ago

'NBA 2K', 'Grand Theft Auto V' help Take-Two surge past estimates

(Reuters) - Videogame publisher Take-Two Interactive Software Inc (TTWO.O) raised its full-year revenue forecast on Monday, boosted by the success of its games “NBA 2K”, “Grand Theft Auto V” and “Red Dead Redemption 2”, sending its shares up 7% in extended trading.

FILE PHOTO: A promotion for the computer game "Grand Theft Auto Five" is show in a Game Stop gaming story in Encinitas, California September 17, 2013. REUTERS/Mike Blake/File Photo

The company, which has been working to secure a foothold in the changing gaming landscape, has managed to prevail over challenges posed by the rise of mobile-based, free-to-play games with its desktop- and console-based games mostly.

“Grand Theft Auto V” has sold nearly 100 million units since its launch in 2013, making it one of the best-selling games ever for the company.

“NBA 2K19”, which debuted last September, was the 5th best-selling game of 2018, according to research firm NPD.

Both the games were among the top-10 selling video games in June, according to NPD.

Take-Two’s 2017 acquisition of Spanish mobile game developer Social Point also helped the traditional game publisher widen its presence in the mobile gaming sector with games “WWE”, “SuperCard” and “WWE 2K19” and compete against Glu Mobile (GLUU.O) and Zynga Inc (ZNGA.O).

Take-Two raised its annual forecast to $2.60 billion and $2.70 billion in adjusted revenue, up from its prior forecast $2.50 billion to $2.60 billion.

Analysts had expected $2.65 billion in revenue, according to IBES data from Refinitiv.

New York-based Take-Two forecast second-quarter revenue of $860 million to $910 million, above analysts’ estimates of $852.5 million.

On an adjusted basis, the game publisher’s revenue in the first quarter ended June 30 stood at $422.2 million, soaring above the average analyst estimate of $356.8 million.

Rival Electronic Arts (EA.O) posted first-quarter revenue above estimates last month, boosted by the strength of its battle royale game “Apex Legends”.

Shares of the company as well as other video game companies tanked after President Donald Trump, in response to the mass shootings in Texas and Ohio, called for an end to glorification of violence and blamed “gruesome and grisly video games” for that.

“We are sickened and saddened by these tragedies. But to blame the video game industry is irresponsible and disrespectful to the families of the victims,” Chief Executive Officer Strauss Zelnick told Reuters. “(Video games) are consumed worldwide. But gun violence is uniquely American and we need to address the issues.”

More than 165 million Americans enjoy video games, and billions of people play video games worldwide. Yet other societies, where video games are played as avidly, do not contend with the tragic levels of violence that occur in the United States, said Entertainment Software Association in a statement.

Take-Two’s net income fell to $46.3 million, or 41 cents per share, from $71.7 million, or 62 cents per share, a year earlier.

Shares of the company were up 7.21% at $123.7 after the bell.

Reporting by Sayanti Chakraborty in Bengaluru and Kenneth Li in New York; Editing by Shinjini Ganguli

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