Video game publisher Take-Two Interactive Software (TTWO) late Monday beat Wall Street's target for earnings in the March quarter but missed estimates on sales. Its guidance for the current quarter and year ahead also fell below views. Still, TTWO stock rose in extended trading.
XThe New York City-based company earned an adjusted $1.09 a share on net bookings of $845.8 million in its fiscal fourth quarter ended March 31. Analysts polled by FactSet had expected Take-Two earnings of $1 a share on sales of $883 million. On a year-over-year basis, Take-Two earnings declined 22% while net bookings rose 8%.
For the current quarter, Take-Two forecast adjusted earnings of 65 cents a share on net bookings of $725 million. That's based on the midpoint of its guidance. Wall Street had predicted earnings of 90 cents a share on sales of $798 million in the company's fiscal first quarter ending June 30.
For the full fiscal year, Take-Two predicted adjusted earnings of $4.33 a share on net bookings of $3.8 billion. Analysts were looking for earnings of $5.81 a share on sales of $4.15 billion. In the company's just finished fiscal 2022, Take-Two earned an adjusted $5.06 a share on net bookings of $3.41 billion.
TTWO Stock Rises Late
In after-hours trading on the stock market today, TTWO stock rose 2.5% to 112.89. During the regular session, TTWO stock climbed 0.2% to close at 110.11.
The company's guidance for the current quarter and year ahead do not include contributions from its pending acquisition of Zynga (ZNGA). Take-Two expects that deal to close on May 23. It plans to give guidance for the combined company in August, Chief Executive Strauss Zelnick told Investor's Business Daily.
Take-Two's business is strong even amid the "return to normalcy" following the Covid-19 pandemic, Zelnick said.
Business "is still at a heightened level above pre-pandemic but somewhat lower than the peak of the pandemic," Zelnick said. "The new normal is just great."
The largest contributors to net bookings in the March quarter were "NBA 2K22," "WWE 2K22," "Tiny Tina's Wonderlands" and "Two Dots," as well as the "Grand Theft Auto" and "Red Dead" game franchises.
Other video game stocks reporting soft bookings in the March quarter included Activision Blizzard (ATVI), Electronic Arts (EA) and European-traded Ubisoft.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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