Shares of Take-Two (NASDAQ:TTWO) gained over 9% in after-hours trading after the company reported earnings for its third quarter of Fiscal Year 2023. Earnings per share came in at -$3.62, which may not even be comparable to analysts’ consensus estimate of $0.68 per share. Sales increased by 55.9% year-over-year, with revenue hitting $1.45 billion. This beat analysts’ expectations of $1.34 billion.
Don't Miss our Black Friday Offers:
- Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
The biggest reason for the discrepancy between the actual earnings per share figure and analyst projection seems to be traced back to two points. One, Take-Two took an impairment charge of $465.3 million connected to “acquisition-related intangible assets.” Two, Take-Two also took an impairment charge of $54.2 million connected to “capitalized software development costs for unreleased and canceled titles.”
Despite that, Take-Two still rolled out some impressive numbers for its second quarter. Fourth quarter net bookings came in at $1.4 billion overall, which was well above even the highest end of previous guidance. Take-Two’s flagship titles, “Grand Theft Auto V,” “Grand Theft Auto Online,” and “Red Dead Redemption 2,” led the way, along with the mobile games under the Zynga banner.
Take-Two management also offered guidance going forward. GAAP Revenue for the full year, scheduled to end March 31, 2024, should come in between $5.37 billion and $5.47 billion, which is well below consensus projections of $6.16 billion. Meanwhile, net cash from operating activities is projected to come in at around $90 million.
Overall, Wall Street has a consensus price target of $134 on TTWO stock, implying 7.18% upside potential, as indicated by the graphic above.