Take-Two Interactive Set to Reveal Earnings Amid Industry Challenges
New York-based Take-Two Interactive Software, Inc. (TTWO) develops, publishes, and markets interactive entertainment solutions. With a market cap of $27.6 billion, the company’s products are designed for console systems, handheld gaming systems, and personal computers. These products are made available through physical retail, digital downloads, online platforms, and cloud streaming services. The prominent game publisher is slated to announce its fiscal second-quarter earnings for 2025 after the market closes on Wednesday, Nov. 6.
Analysts Predict Decline in Quarterly Profits
Ahead of the earnings call, analysts anticipate that TTWO will report a profit of $0.05 per share on a diluted basis. This figure reflects a significant decline of 93.8% from the $0.80 per share posted in the same quarter last year. In the last four quarters, the company has exceeded consensus estimates three times, while missing forecasts on one occasion.
Full Year Earnings Projections Indicate Growth
For the entire fiscal year, analysts project TTWO’s earnings per share (EPS) will reach $1.05, marking a 15.4% increase from the previous year’s $0.91. Moreover, EPS is expected to surge 447.6% year over year to $5.75 in fiscal 2026.
Stock Performance Lags Behind Major Indices
TTWO stock has not performed as well as the S&P 500, which has seen gains of 36.8% over the past year, while TTWO’s shares rose only 13% in the same timeframe. The stock also underperformed compared to the Communication Services Select Sector SPDR ETF Fund’s (XLC) increase of 33.9%.
Challenges from Market Trends
TTWO’s recent struggles are partly attributed to a 10% drop in weekly in-app purchases, the highest decline among gaming companies tracked by Bloomberg. Additionally, factors such as soft consumer spending, weak mobile advertising, and rising operating expenses have weighed on the company’s performance.
Recent Financial Results Show Modest Growth
On Aug. 8, TTWO shares closed up over 2% after reporting its Q1 results. The adjusted EPS stood at $0.05, surpassing Wall Street’s expectations of $0.01. The company reported revenue of $1.3 billion, a 4.2% increase year over year. For Q2, TTWO forecasts revenue between $1.29 billion and $1.34 billion, with full-year revenue expected to range between $5.6 billion and $5.7 billion.
Analysts Favorably Rate TTWO Stock
Despite recent challenges, analysts remain optimistic about TTWO stock. The overall consensus is a “Strong Buy” rating. Of the 24 analysts monitoring the stock, 19 recommend a “Strong Buy,” two suggest a “Moderate Buy,” and three indicate a “Hold.” The average analyst price target for TTWO is $179.12, representing a potential upside of 11.1% from current levels.
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On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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