GTA 6: Take-Two's Stock Plummets 186% Just as Pre-orders Begin

Take-Two lost $34.1 million in its most recent quarter, an increase of 186% from a year ago, despite the flood of pre-orders for GTA 6.

Take-Two, the company that owns GTA 6, has closed its first fiscal quarter with $34.1 million in net losses, an 186% increase from a year ago. And this happened right in the quarter when pre-orders for the game skyrocketed. This time around, enthusiasm for the game and the company’s financials are heading in different directions.

Why Take-Two Is Losing Money Right Before GTA 6

The financial shortfall isn’t due to the development of GTA 6, but rather stems from elsewhere. The company took a $43.4 million charge after canceling a game from an external studio that was in its pipeline but was never actually announced. That charge, combined with the usual expenses for the quarter, explains much of the jump in losses, even though the business itself wasn’t doing badly.

In fact, net revenue rose 2% to $1.5 billion, and net bookings (the metric Take-Two uses to measure its sales) reached $1.39 billion, exceeding the company’s own forecast. Even in terms of loss per share, the company performed better than analysts had anticipated, and players’ recurring spending on existing games fell less than expected. From a purely operational standpoint, the quarter was better than feared.

The Forecast That Failed to Convince Wall Street

The problem lay in the fine print for the full year. Take-Two maintained its net bookings forecast for the full fiscal year at $8.0–8.2 billion, well below the nearly $8.62 billion analysts had expected. With GTA 6 as the main driver of that growth, the market expected the company to be more ambitious.

CEO Strauss Zelnick explained during the investor conference call why the company hasn’t adjusted that figure despite the flood of pre-orders:

“One of the reasons we didn’t change the forecast is that, to be clear, we haven’t sold a single unit yet.”

Zelnick did describe the game’s pre-orders as “unprecedented,” but cautioned that strong pre-orders do not guarantee a successful launch. Textbook caution, even if investors didn’t find it the least bit amusing. Take-Two’s stock fell nearly 2% even though the company had beaten quarterly estimates, so the forecast carried more weight than the results themselves.

Quarterly Summary, by the Numbers

What This Means for the Release of GTA 6

None of this affects the release date, which remains confirmed for November 19. Its predecessor, GTA V, has sold over 200 million copies since 2013, so the room for growth that Wall Street sees in GTA 6 is by no means a fantasy. What this report does make clear is that, no matter how well pre-orders are going, Take-Two isn’t going to release a higher figure until it has actual sales to show. The next quarterly report, with the game already on the market, will reveal whether Zelnick’s caution was prudent or an overly conservative estimate.