:Take-Two Interactive Software forecast its fourth-quarter bookings below estimates on Thursday, owing to weaker spending on mobile games as consumers grapple with economic uncertainties and still-high inflation.
The videogame industry has experienced two tumultuous years marked by industry-wide layoffs, studio closures and project cancellations, owing to high borrowing costs and weak sales.
Take-Two’s mobile titles such as “Empires & Puzzles” underperformed its own expectations as players cut back on in-game spending, company executives said on a post-earnings conference call.
The company acquired “FarmVille” maker Zynga in 2022 to boost its heft in the mobile game industry and better compete with rivals.
“The mobile division is likely at the end of its integration process and I’d expect it to start contributing more significantly to Take-Two’s bottom line,” Joost Van Dreunen, a lecturer at NYU’s Stern School of Business, said.
Shares of the videogame publisher jumped more than 6 per cent in extended trading, after it reiterated that its highly anticipated “Grand Theft Auto VI” is set to launch in the fall of 2025.
GTA is a long-running action-adventure franchise that puts players in a sandbox environment filled with fast cars, guns and dynamic characters.
“The lack of news (on GTA VI) had investors concerned that it might slip, so this is good news,” Wedbush Securities analyst Michael Pachter said.
Take-Two also reiterated its expectation of a rise in net bookings in fiscal 2026 and 2027, with many analysts expecting that growth to come from “GTA VI.”
The company expects bookings to be between $1.48 billion and $1.58 billion for the fourth quarter, the midpoint of which is slightly below analysts’ average estimate of $1.54 billion, according to data compiled by LSEG.
Besides “GTA VI”, Take-Two expects to release big titles such as “Borderlands 4” and “Mafia: The Old Country” this year.
Its third-quarter bookings of $1.37 billion missed estimates of $1.39 billion.
On an adjusted basis, it earned 72 cents per share, compared with the estimates of 57 cents.
