Take-Two Interactive Software (TTWO, Financial) stock is down 3% since the company released its quarterly earnings report last week. The video game developer's stock remains a strong choice for investors, rising over 96% in the past year and 589% since 2012.
The company's fiscal quarterly results were primarily positive, with 52% growth in revenue to $571.6 million from $377.2 million during the same period a year prior.
Investors are weary of the company's stock following the announcement that "Red Dead Redemption 2," the company's highly anticipated game, will be delayed for at least the next 10 months. The game's delay is expected to cause the company's full-year results to take a hit.
The company posted earnings per share (EPS), on a GAAP basis, of 89 cents per share, up from 48 cents per share the year prior. Adjusted earnings were 65 cents with estimates of 47 cents.
"Sid Meier's Civilization 6," "Grand Theft Auto Online" and "NBA 2K17" were among the company's top sellers. "Mafia 3" and "Grand Theft Auto 5" both posted strong sales on the quarter.
The company's forecast for its fiscal 2018 year has adjusted sales of $1.52 billion on the top end and $1.42 billion on the low end. The figure hurt investor sentiment after analysts predicted the company's sales to be $2.23 billion on the year.
Take-Two's digital sales remained strong with 43% growth year over year and sales increasing to $278.7 million. The company's digital sales have grown to account for 49% of the company's total revenue. In-game content sales for add-ons, content and currency hit an all-time high, too, accounting for 24% of all sales, or $137 million in total sales.
Net income rose 85% over the same quarter a year prior with net income of $99.3 million. Investors expected the company's earnings per share to be 57 cents. "Grand Theft Auto Online" accounted for the largest recurrent spending among consumers.
The company has positioned itself well to compete in eSports with an announcement that the company partnered with the National Basketball Association to launch the "NBA 2K eLeague." The league will include the company's NBA 2K franchise game.
The games will be broadcast online and on television. Seasons will consist of regular season, playoffs and a championship. No word on when the eLeague will go live has been released by either party. The partnership is the first between a major league sports association and a game developer to bring eSports to the mainstream.
ESports is expected to grow into a $1.5 billion industry by 2020 and reach $696 million in 2017.
Disclosure: The author does not own any stakes in the equities listed.
