Take-Two Interactive posts Q2 loss

Empty

NEW YORK -- Video game publisher Take-Two Interactive Software Inc. said Monday its fiscal second-quarter net loss was slightly wider than a year ago, as revenue declined 23%.

Take-Two, best known for its popular, violent "Grand Theft Auto" video game series, also outlined a restructuring plan that aims to cut costs by about $25 million a year by 2008.

Take-Two, which earlier this year underwent a shareholder coup that ousted its chief executive and nearly all of its board, posted a loss of $51.2 million, or 71 cents per share, for the second quarter, which ended April 30. That compared with a net loss of $50.4 million, also 71 cents per share, in the same period a year ago.

Revenue fell 23% to $205.4 million from $265.1 million. The company attributed the decline to strong sales a year ago of its "Elder Scrolls IV: Oblivion" game.

Analysts, on average, were expecting a loss of 58 cents per share on sales of $204.4 million, according to a poll by Thomson Financial. The analyst estimates exclude items but include stock-option costs, which totaled 5 cents per share for the quarter.

The company said the restructuring plan will require layoffs. It did not give a specific number, but spokesman Edward Nebb said it will be "meaningful." Take-Two has about 2,100 employees.

The plan calls for consolidating the management, marketing and business development operations of the company's 2K label, which publishes "Elder Scrolls" and its expansions, and the 2K Sports label on the West Coast. Take-Two also plans to consolidate its international operations and realign label and studio administrative functions.

The company said it would stick by 2007 financial forecast and said it has named its interim chief financial officer, Lainie Goldstein, to the post on a permanent basis. Former CFO Karl Winters resigned in April following the shareholder coup

In a conference call with investors, Take-Two also said it is in "active discussions regarding possible alternatives" for its Jack of All Games distribution business and its Joy Tech unit.

The company's shares rose 28 cents to $19.22 in extended trading after the release of the results. The stock had closed the regular session up 29 cents at $18.94.
comments powered by Disqus