Despite somewhat disappointing holiday results, shares of Take-Two Interactive Software Inc. and Activision Blizzard Inc. jumped Tuesday, after analysts wrote that Wall Street’s view of the videogame industry must change.
“Like Ubisoft and [Entertainment Arts, Take-Two’s] management attributed the miss in part to difficult macro conditions, indicating that pressured consumers opted to stick to established franchises,” Creutz said. “While we are not discounting management’s reasoning, we tend to think this may simply be the new normal for the console/PC videogame market.”
Basically, what the analysts are saying is that it is becoming harder to get gamers to adopt a new game, but the games they do adopt will produce more revenue for a longer period. Take-Two Chief Executive Strauss Zelnick’s repeated use of the word “blockbuster” in Monday’s earnings call drove home the point that videogames have become even more like movies, in that Hollywood makes its real money by churning out sequels rather than taking a chance on new franchises.
The “potential new paradigm” of how videogames are developed and sold favors Take-Two “in the long run,” Uerkwitz believes. That will make the big hits even more important for companies and their investors. Some to watch this year include Bandai Namco Holdings Inc.’s 7832 “Elden Ring” and Warner Bros. Discovery Inc.’s WBD “Hogwarts Legacy,” or what Creutz called breakouts among “big budget, well-marketed games .”
Wells Fargo analyst Brian Fitzgerald, who has overweight ratings on both Take-Two and Activision Blizzard, called Take-Two’s report “meh,” adding that the publisher’s “strong catalog” and “imminence of GTA VI” helps.
Canada Canada Latest News, Canada Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: KPRC2 - 🏆 80. / 68 Read more »