Take-Two (TTWO) Beats Q3 Views as Digital Sales Soar; Offers Improved FY13 Outlook

February 5, 2013 5:01 PM EST
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Take-Two Interactive (Nasdaq: TTWO) is trading strong in the after-hours session Tuesday following a third-quarter earnings beat, but mixed outlook.

Revs improved 76 percent to $415.77 million, while net income improved multiples to $71.4 million or 66 cents per share. Adjusted for certain items, revenue was $405 million and EPS was 67 cents.

The Street was looking for revs of $366.27 million and EPS of 55 cents.

Take-Two noted that the biggest contributors to gains in the quarter were NBA 2K13, continuing sales of Borderlands 2, the release of XCOM: Enemy Unknown, and catalog sales led by Grand Theft Auto IV and Red Dead Redemption.

Notably, revenue from digitally-delivered content rose 244 percent, accounting for 23 percent of adjusted revs.

Guidance calls for fourth=quarter 2013 EPS of 10 cents to 25 cents and revs of $235 million to $285 million. The Street sees EPS of 15 cents and revs of $303.4 million.

Fiscal 2013 guidance calls for revs of $1.15 billion to $1.20 billion and EPS of flat to 20 cents. Prior guidance called for revs of $1.10 billion to $1.20 billion and EPS of flat to 20 cents. The Street currently sees revs of $1.18 billion and EPS of 15 cents.

"With consumer anticipation building for the launches of BioShock Infinite and Grand Theft Auto V, we are well positioned for a solid finish to fiscal year 2013 and substantial revenue and earnings growth in fiscal year 2014," commented CEO Strauss Zelnick.

The company also approved a 7.5 million common stock repurchase plan today.

Shares of Take-Two are up 6.6 percent late Tuesday.

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