Shares of Take-Two Interactive Software, Inc (NASDAQ:TTWO) rallied in early trading on Tuesday, after the company Monday reported its fiscal second-quarter results.
The company’s quarterly results were calm and steady. They came just ten days before the launch of Grand Theft Auto VI (GTA VI), according to BTIG.
The Take-Two Interactive Software Analyst: Analyst Clark Lampen reiterated a Buy rating and price target of $262.
The Take-Two Interactive Software Thesis: There is potential upside to GTA VI unit sales assumptions and NBA 2K RCS (recurrent consumer spending or repeated smaller purchases made by players inside games), Lampen said in the note.
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GTA VI: Management indicated that sales from the GTA VI Ultimate Edition were a key driver of their forecast of 12% RCS growth. Management is likely treating the difference between the base purchase price and the Ultimate Edition purchase price as RCS bookings, "as the ultimate edition unlocks exclusive in-game content that would normally be considered RCS," he wrote.
The estimate for GTA VI unit sales for the fiscal third quarter has been lowered from 35 million to 33 million units. BTIG estimates $162 million of RCS bookings would be from the GTA VI Ultimate Edition, implying around 35% premium mix against the sales estimate of 33 million units, he noted.
NBA 2K: This had a softer start in the first quarter. Management expects new content to drive spending in the second half of the fiscal year.
A new sports franchise seems to be in the works from the new studio Small Axe under 2K. This is separate from the five main sports games planned for fiscal 2028-29, Lampen said.
TTWO Price Action: Take-Two shares had risen by 6.32% to $220.59 at the time of publication on Tuesday.
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