Shares in Take-Two Interactive Software rally on fiscal 1Q earnings beat despite revenue dip

Shares in Take-Two Interactive Software Inc (NASDAQ:TTWO) rally in premarket trade Friday as the video game company posting earnings that trounced Wall Street estimates.  

Investors sent Take-Two stock flying 12.52% to US$127.42 in the premarket.

For its first quarter of fiscal 2019, the New York-based company posted earnings of US$71.69mln, or US$0.12 per share. It beat consensus earnings estimate of US$0.7 per share.

The company’s revenue did fall 7.2% compared to the year-ago quarter from US$418.22mln to US$387.89mln.

The company said that recurrent consumer spending in the shape of virtual currency, add-on content and in-game purchases accounted for 62% of revenue, compared to 41% in last year’s fiscal first quarter.

The biggest contributors to revenue were its bestselling Grand Theft Auto Online and Grand Theft Auto V, NBA 2K18, Dragon City and Monster Legends, and WWE SuperCard and WWE 2K18.

The company said that as of June 30, 2018 it had cash and short-term investments of US$1.10bn.

For its second quarter of the fiscal year, Take Two forecast earnings of US$0.85 per share, below the US$0.89 per share analysts forecast.

Contact Uttara Choudhury at [email protected]

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Story by ProactiveInvestors