Looking for ways to cut losses caused by the previous board, Take Two's new management believes that its best bet is to push GTA:IV a few weeks back.
In a nutshell, Take Two plans to push GTA:IV from fiscal year 2007 to fiscal year 2008. This would increase FY:2007's losses but will improve the company's FY:2008 prospects. Take Two also "believe that a two-week delay would provide a reasonable gap between the launch of Halo 3 and the launch of GTA IV, and would actually help sales of both games.
In addition, a delay of the "normal" SKU for GTA IV by two or three weeks could allow Take-Two to maximize revenues from the $89.99 Collector's Edition of the game by shipping that SKU on October 17, and to increase overall profitability".
Take Two who sustained continues loss over a long period of time has changed its board of directors in hope of returning to profitability. The new management stated that they may have to close some studios and cancel some games. "We continue to believe that at current levels, Take-Two shares are overvalued. In our view, the company faces an uphill battle in turning around its history of generating losses in a strong video game environment."
"We think that heightened competition from the competitors above will limit Take-Two's ability to grow its market share, and we continue to believe that its sports experiment is misguided. "
"While we believe that new games like The Bigs and All-Pro Football are likely to receive critical acclaim, we are not sanguine about their prospects in a competitive sports market. We expect to see increased resolve from competitor Electronic Arts in defending its sports dominance, and think that new CEO John Riccitiello is a formidable adversary determined to bury Take-Two’s sports effort"' said Wedbush Morgan's Michael Pachter.
