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Take-Two Takes Financial Hit
Gamespot reports that Take-Two Entertainment, publishers of titles like Civ IV, has reported much lower earnings than in the previous year in the same period. From the article: "There were several reasons behind the shortfall. Though Take-Two had three Xbox 360 launch titles--Amped 3, NBA 2K6, and NHL 2K6--and a solid PC hit in the form of Civilization IV, the company admits it had a lackluster Christmas in 2005. 'Clearly, the holiday season did not live up to anyone's expectations,' said Paul Eibeler, Take-Two's president and CEO, in a statement."
I can see this happening to Take Two. Civ 4 was a great game, but the 4th in a series of games and, lets face it, we've all played it before (ie Civ 1-3). The 2K* line isn't anything special either - and not being EA means their football titles lack actual NFL stats, which I've witnessed being the deciding factor on which sports game to purchase.
- I voted for Nintendo and against Bush
(...and whatever happened to Gary Grigsby?)
... when there aren't any Xbox's to play them on. I've seen shelves and shelves and shelves of Xbox 360 games for *weeks* now. The '07 sports stuff might well be current before 360's are commonly available.
If they had released a linux version of CIV4 I would have bought 2 copys.
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Maybe they'll try to make a new, original game, instead of rehashing there old titles?
"...did not live up to anyone's expectations" eh ?
Who are these people and where did they get their expectations from? If I recall correctly the 4th quarter of 2004 included Grand Theft Auto : San Andreas. I'd expect that to mean higher revenue than this year - Civ4 is PC only and as has been pointed out there aren't enough XBox 360s in play yet for the platform to generate huge revenues.
Can anyone explain why these results are surprising ?
It sounds like publishers are getting fed up with the 360 fiasco.
No one is going to go right out and state the fact but almost certainly 360 titles are quietly getting either canceled or put on a wait see status.
Even though the PS2 is still flying off the shelves at $150, the PS3 can't come quick enough for the games market. The battle for next gen dominance between Sony and Nintendo is going to be insane - especially now that the 360 is pretty out of the picture.
Of course the sales will be down from same period last year - that's when GTA:San Andreas came out. Did they really expect to even come close to that?
:P
More importantly, who gives a crap, other than stock holders. They still had 1.2 billion in sales. Obviously only a part of that number will be profit, but the important thing is they still MADE MONEY. How is that a bad thing?
Joseph?
Bill Harris over at Dubious Quality has been talking some about Take 2. He pointed out, a few days ago, that they're using an old trick.... reserves.
When something bad happens, you 'set aside' an obscenely large amount of money to 'deal with the problem'. You announce, loudly, that you WOULD have made money ('beat the Street') if only the terrible thing hadn't happened. Investors sigh, and your stock gets hit, but usually not that badly. Then, later on, you take some of the money out of the Rainy Day Fund to make a quarter that's not doing so well.
That's exactly what they did here. They set aside THIRTY MILLION DOLLARS to take care of the 'Hot Coffee' problem. This quarter, they announced that the problem wasn't as bad as they thought, so they 'unreserved' eight million dollars...enough to mitigate the damage, so they don't look quite so much like a sucking chest wound.
This is totally an accounting game. By now, they know how much damage Hot Coffee did. They could unreserve all but a million or so... that should be more than enough to handle any additional returns and/or pay for any lawsuits. They didn't do that, because they want to be able to 'beat the Street' in some later quarter, and artificially drive up the stock price.
Investing is EXTREMELY risky if you don't know accounting. Accounting is the language of business, and companies are very good at whitewashing a rotten infrastructure.... only if you 'speak' accounting (or pay someone who does), can you be sure they're on the level.
There are very, very few trustworthy, accurate analysts. When was the last time you saw a 'sell' on ANYTHING?
Reminds me of the Atari disaster a while back. One executive thought the consumer would buy not one but TWO copies of the same Atari title. One for the house, the other for their ski resort.
Which makes me question if there were 500 xbox 360s for sale at a single place, did they have more than 500 copies of a single game title? If so, wow that's not a good idea. Or, they have extra stock in anticpation of people scratching their disks.
TTWO has recently postponed more than one game (one of the GTA games in Japan and Europe, and TES:Oblivion in general) and was collaterally stricken by the production problems that failed to get enough Xboxes to market quickly enough during the holiday season. The problem was bad enough that they prewarned for their fiscal Q4'05 and Q1'06 right when their Q4 ended at the end of October 2005, so this really isn't news, but just the culmination of what we all already knew about.
That sounds like a serious pitfall. I have never even seen a 360 system, crap load of games on the shelves though. I probably would have bought the system if I could have found it. Christmas has come and gone and my budget has shrunk back to reasonable levels; I won't be getting one till after the first price drop or more than likely next christmas, if then. Between here and there, there is a PS3 and a Nintendo coming out to compete with. Now they get to compete with which system has the most games I am interested in.
I think the shortage over the holidays was a VERY bad move on Microsoft's part, if they wanted to get a big install base. They should have risked losing a christmas launch in a less popular/critical region (Europe?) and sending more to sure markets than having such lack-luster results due to shortages in all regions. Now they just have a very unimpressive user-base in all regions launched. But that's Microsofts problem.
TakeTwo's problem; if I had a 360, NONE of those games would be one I would buy. I would own PGR3, and DOA. I'd buy Oblivion, but they keep pushing it back.
IMHO everything after Civ2 just got too convoluted and a pain in the ass to play. Also I realize I am a minority, but I can't stand the GTA games. They bore me to tears and offer me nothing I can relate with. "Steal this car, deal some drugs, shoot some cops, join gang X..." Honestly I've never felt the drive to do any of those things and just can't for the life of me have fun doing them in a game. Oh and I like some dark subject material for my games; vampires, demons, dragons, aliens, genocide, mayhem... I guess I just like games that offer me the ability to do things I could NEVER do in real life, like annihilate demons from hell, or be a space pirate.
Am I the only one that dislikes the GTA series?
"If I were bound by all laws everywhere I'm sure I would have committed a capital crime somewhere."
The holiday season sure lived up to my expectations.
DS! Woo!
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If nobody notices, it's not illegal.
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Why is it that when you believe something it's an opinion, but when I believe something it's a manifesto?
There is no competition in the PSP game market. Take-two can make all the games there and be in a win-win situation. Help Sony and help themselves.
I'd say the delaying of The Elder Scrolls: Oblivion could have had some effect as well.
Blessed are the 1337, for they shall pwn the earth.
This is just a theory. As more and more games are made, more players are satisfied playing older games and aren't as interested in shelling out actual money to buy new games. I think this is something that is catching on, especially since there is a new generation of gamers entering into the field who haven't played all the games us old timers have. Now... If a mega hit comes out that is radically fun, everyone will have to buy a copy.
God spoke to me.