“They haven’t announced any new games for next year ... They haven’t done so all year, so investors are getting a bit frustrated waiting,” Wedbush Securities analyst Michael Pachter said.
The videogame publisher’s earnings were also overshadowed by a $2.4 billion buyout of Glu Mobile Inc by rival Electronic Arts, which previously outbid Take-Two in December to snap up British firm Codemasters for $1.2 billion.
Losing the Codemasters deal to “our friends out West” was “disappointing”, Take-Two Chief Executive Officer Strauss Zelnick told analysts on an earnings call.
“I suppose there is some concern about ‘missed opportunity’, but nobody expected Take-Two to buy Glu today,” Pachter said.
Take-Two on Monday raised annual adjusted sales targets on sustained demand for its top franchises, “NBA 2K” and “Grand Theft Auto”, as COVID-19 curbs continue to boost videogame sales worldwide.
The company lifted its full-year adjusted revenue forecast to a range of $3.37 billion to $3.42 billion, from an earlier view of $3.15 billion to $3.25 billion. Analysts had expected sales of $3.3 billion, according to Refinitiv IBES data.
Electronic Arts and Activision Blizzard last week forecast upbeat revenue on the back of a pandemic-led boost in demand for videogames, which garnered record sales of $56.9 billion in 2020, according to research firm NPD.
On an adjusted basis, Take-Two’s third-quarter revenue fell to $814.3 million from $888.2 million, still beating analysts’ average estimate of $747 million.
The company had benefited from the release of “Red Dead Redemption 2” and “The Outer Worlds” in the year-ago quarter. Reporting by Tiyashi Datta and Munsif Vengattil in Bengaluru; Editing by Ramakrishnan M.