Take-Two Interactive Software, which has targeted the release of “Grand Theft Auto VI” in the fall of 2025, lowered its forecast for fiscal 2025 pre-orders on Thursday.
Shares of the New York-based company fell 2.5% in after-hours trading.
The company said the forecast reflects the new release timing of the highly anticipated game, which is expected to be an instant hit, generating billions of dollars in annual sales, according to several analysts.
The video game publisher now expects fiscal 2025 bookings to be between $5.55 billion and $5.65 billion, down from its previous forecast of just over $7 billion.
Take-Two’s predictions are bleak, and last week’s predictions from Electronic Arts and Roblox were disappointing.
Take-Two laid off about 5% of its workforce last month and canceled several projects in development as part of a cost-cutting plan, in line with similar moves across the gaming industry in response to slowing consumer spending.
Still, the company and analysts expect pre-orders to accelerate starting in fiscal 2025, helped by the launch of GTA and a slew of other releases, including games from recently acquired Borderlands maker Gearbox Entertainment.
When asked how much revenue Gearbox could contribute to Take-Two, Wedbush Securities analyst Michael Pachter said: “My guess is they will add $150 million this year and maybe $300 million to $400 million in fiscal 2027.”
“We are confident that our company will achieve new levels of success and expect sequential net bookings growth in fiscal 2025, 2026 and 2027,” said Take-Two CEO Strauss Zelnick.
Company executives said on a post-earnings conference call that Take-Two will have about 40 games by fiscal 2027 and 16 games by fiscal 2025.
“They (Take-Two) should see significant growth in GTA Online once GTA VI launches,” Wedbush’s Pachter added.
Take-Two’s fourth-quarter bookings fell 3% to $1.35 billion, according to LSEG, but beat analysts’ average estimate of $1.30 billion.
© Thomson Reuters 2024
