Red Dead Redemption, the blockbuster Western video game from Take-Two Interactive, sold more than 8 million units through Dec. 31, thanks in no small part to online content sales.
The results show that a big blockbuster console game can get a second life and continuous growth in sales with a strong online expansion strategy. The 8 million games (shipped in) figure is huge for Red Dead Redemption and it’s a great result for a game that didn’t have much of a pre-defined following. At $60 a copy, Red Dead Redemption generated an estimated $480 million, which makes it one of the most successful games of the year.
Take-Two reported the new number of games shipped with its third fiscal quarter earnings announcement. The company’s shares rose 4.5 percent in after-hours trading. Take-Two said it hit its earnings targets thanks to some big hits. Revenues for the quarter ended Dec. 31 were $334.3 million, down 7 percent compared with $360.4 million a year ago.
GAAP net income from continuing operations was $40.8 million, or 45 cents a share, compared with $39.4 million, or 44 cents a share, a year ago. Non-GAAP net income from continuing operations was $49.5 million, or 52 cents a share, compared with $49.2 million, or 53 cents a share, a year ago. Analysts had expected non-GAAP earnings of 34 cents a share.
The biggest contributors to revenues were NBA 2K11, Red Dead Redemption, the disc version of Red Dead Redemption Undead Nightmare, and other old titles. Digital content was a big part of the sales of Red Dead Redemption, Borderlands, and Sid Meier’s Civilization V.
Take-Two has had erratic financial performance for years because it was dependent on Grand Theft Auto sales. When it shipped a GTA game, profits were huge. But when it didn’t, it usually reported a loss. For the first time, the company has had strong profits in an off-GTA year. That was because the Western gunslinger game, Red Dead Redemption, was such a huge hit. Take-Two measures sales in terms of units shipped into retailers.
In the coming year, Take-Two is confident in its ability to deliver more outstanding titles. The company is also going to expand in Asia and Latin America, grow its revenues on new platforms and distribution channels, and launch new downloadable content and online games.
Take-Two’s Rockstar Games division plans to launch L.A. Noire (pictured at top), a cool-looking game with realistically animated human faces, on May 17 in North America. Take-Two’s 2K Games label also plans to launch Duke Nukem Forever on May 6. That title has been in the works for more than a decade. Take-Two said that NBA 2K11 sold more than 4 million units.
For its fourth fiscal quarter ending March 31, Take-Two estimates revenue will be $130 – $150 million, with a loss per share of 40 – 45 cents. For the fiscal year ending March 31, the company expects revenue to be $1.08 – $1.10 billion. The fourth-fiscal quarter outlook is better than Take-Two’s previous forecast, which anticipated a loss of 50 – 60 cents a share on revenues of $100 – $150 million.