Take-Two Interactive (NASDAQ:TWO) is showing how its woes are far from over. The company is lowering guidance because it delayed the launch date for its upcoming blockbuster game Grand Theft Auto 4. The company says additional development time is required to complete the title. Hopefully, if Take-Two doesn’t want there name to be "took-none," they aren’t developing any more "Hot Coffee" scenes. This GTA title is now being delayed to fircal 2008 instead of calender Q4 2007.
Take-Two is also delaying its Manhunt 2 for PS2, PSP, and the Wii. The losses now look large, quite large. The company says it is in sound financial position, but they just now irritated shareholders and clients. Investors who jumped in hoping that the new team was going to do a full takeover probably wish by now that they would have played a stock by the name of Forrest Gump’s fruit company.
There is always some good news, and this is the case for the rest of the sector. Microsoft’s (NASDAQ:MSFT) Halo 3 is going to set records for game releases. GTA was set to be another major blockbuster coming out right after Halo 3. In short, Electronic Arts (NASDAQ:ERTS), THQ Interactive (NASDAQ:THQI), and Activsion (NASDAQ:ATVI) may have just gotten one monkey off their backs. Activision (NASDAQ) just released earnings and is trading up about 1% on "Guitar Hero". THQ Interactive (NASDAQ:THQI) traded higher today, but its shares are up another 1%; and Electronic Arts (NASDAQ:ERTS) is up almost 1% after a 7% rise today, despite its warning yesterday. GameStop Corp. (NYSE:GME) isn’t faring as well since this takes out a key upcoming blockbuster title out of the Christmas season sales, with shares giving back gains today with a 3.6% drop in after-hours.
We noted just yesterday how the sales out of the upcoming Halo 3 and GTA 4 would have acted as a suction against many of the outside game title sales for a period after those were released. This delay of the GTA title just got rid of a monkey for the other game publishers.
Take-Two shares are down almost $3.00 in after-hours trading down to $14.00.
Jon C. Ogg
August 2, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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