Take Two reports loss for Q3 as San Andreas looms

Publisher Take Two Interactive has announced a $14.4 million loss in the third quarter of 2004, slightly underperforming marker expectations, but all eyes are on the firm's strong projections for GTA: San Andreas.

The company's loss translates to a $0.32 loss per share, which is slightly lower than the $0.30 loss expected by analysts. However, the firm's Q3 revenues of $160.9 outperformed not only the previous year's $152.1 million figure, but also the analyst consensus target of $137.2 million.

Red Dead Revolver was the company's biggest title during the three month period, which ended on July 31st - it accounted for some 22 per cent of revenue, which means between 800,000 and 900,000 units were shipped, while the next largest title was ESPN NFL 2k5, with around 13 per cent of revenue - although the lower price point of the ESPN title means it probably sold around 1.3 million units.

All attention, however, has been focused not on the company's performance during Q3 but on its projected performance in Q4, which will see the launch of Grand Theft Auto: San Andreas a week later than expected on October 26th.

San Andreas looks set to close Take Two's financial year with a bang; up to 25 per cent of the firm's FY2004 revenues will come from the title, which is expected to ship 4.5 million units to retail on day one.

According to the firm, pre-orders of San Andreas are already running at higher levels than preorders for Vice City did. The company has also confirmed that the title will ship at $49.99 in the USA, not at a higher "premium" price point as some commentators had expected.

Take Two is anticipating revenues of $455 to $470 million in the fourth quarter, leading to full year revenues of $1.145 to $1.160 billion, while its figures for FY2005 - which will include many of the PS2 sales of San Andreas, as well as the now-confirmed PC version of the game - call for revenues of $1.2 to $1.3 billion.

However, analysts believe that these figures may be conservative. "We believe that management is providing conservative guidance for FY05," commented Boris Markovich of TerraNova Institutional Equity Research in a note today. "The company has a recent history of disappointing results versus their guidance (missing estimates three out of the past four quarters). It seems to us that the new management team is working to manage investor expectations in a more tempered manner."