Take-Two Takes Financial Hit 24
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."
Love / Hate Relationship (Score:2)
Re:Love / Hate Relationship (Score:1)
Civ 4 did suffer from some bugs that affected a decent number of people, and as a result it hurt sales. Note that the game is still doing decently, and it's better than most sequels.
3 Xbox launch titles aren't particularly lucrative (Score:5, Insightful)
Re:3 Xbox launch titles aren't particularly lucrat (Score:2)
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.
Linux version (Score:1)
hmmm... (Score:3, Insightful)
Re:hmmm... (Score:4, Funny)
Anyone's Expectations ? (Score:2, Insightful)
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 ?
Gimme a friggin break (Score:4, Insightful)
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?
Re:Gimme a friggin break (Score:4, Insightful)
The Stockholders are the ones who the company cares about. Not you or me (unless were stockholders.)
This lackluster performance could in some investors eyes signal a preview of what is yet to come, causing them to reduce or liquidate their holdings in take-two. As the stock hits the market, the price drops and that in turn indicates that the company is doing something wrong.
Most of the employees probably have a decent portion of the compensation given to them in the form of employee stock options. As the price of the stock drops, the value of the stock options decrease, lowering the employees compensation and normally their morale as well. Which can lead to defections to other companies and a general sliding of take-two's stock price progressively lower, which leads to lower compensation, lower morale, higher defections, etc.
We don't matter, the stockholders do, period. If it makes the stock holders happy, the company will try to do it, regardless of what we think.
they're playing accounting games, too... (Score:5, Informative)
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?
Re:they're playing accounting games, too... (Score:2)
Yes it's an accounting game. They set that money aside so that the issue doesn't hang like a cloud over the company for an indefinate period of time. The worst thing in the stock market is uncertainty. In this case you tell your investors, worst case is $30 million dollars, take your lumps and move on. There is still the possibility that some angry parent or bored lawyer decides to sue over the Hot Coffee mod. Over t
Re:they're playing accounting games, too... (Score:2)
Not really new news (Score:2)
They were banking on 360 games? (Score:2)
Re:They were banking on 360 games? (Score:2)
No, I can't stand them. But I cannot stand any game that does not let me save at any time I like. I hate replaying a long sequence simply because I am not a good buttonmasher.
Didn't live up? (Score:2)
DS! Woo!
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Go after PSP (Score:2)
Another factor (Score:1)
The 'mega hit' phenonomena? (Score:2)