Take-Two stock tumbles after it cuts outlook

$Take-Two Interactive Software(TTWO.US)$ $FactSet Research Systems(FDS.US)$ Take-Two said in a statement that its fiscal 2023 net bookings would come in between $5.4 billion and $5.5 billion, lower than the company’s previous expectations of $5.77 billion at the midpoint.

Analysts surveyed by Refinitiv expected $5.88 billion in sales for the year. Take-Two’s net bookings primarily includes digital game sales or sales to wholesalers, as well as licensing fees and merchandise.

It also said it expects a fiscal year ending March 31, 2023 net loss between $674 million to $631 million, worse than the guidance of a net loss between $438 million to $398 million that it provided in its first-quarter earnings.

Take-Two’s slashed outlook comes as gaming slows, and particularly games on mobile devices like smartphones, after two years of elevated sales and engagement thanks to the Covid-19 pandemic. Game sales are also being hurt as consumer confidence falls in the face of rising interest rates and a possible recession.

“Our reduced forecast reflects shifts in our pipeline, fluctuations in FX rates, and a more cautious view of the current macroeconomic backdrop, particularly in mobile,” Take-Two CEO Strauss Zelnick said in a statement.

Take-Two is known for games including “Grand Theft Auto” and its “NBA 2K” series. In September, a hacker published some files including the source code of the company’s unreleased and highly anticipated title “Grand Theft Auto 6.”

Take-Two also owns mobile giant Zynga, known for “Words with Friends,” after purchasing it for $12.7 billion earlier this year.