Take-Two's Grand Theft Auto V a Hit - Analyst Blog

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Take-Two Interactive 's ( TTWO ) recently released game Grand Theft Auto V grossed $800.0 million worldwide in first-day sales. More importantly, Grand Theft Auto V broke the $500.0 million first day sales record set by Activision 's ( ATVI ) Call of Duty: Black Ops 2 in 2012.

Developed by Rockstar North, Take-Two launched the game on Sep 17 for Sony 's ( SNE ) PlayStation 3 and Microsoft 's ( MSFT ) Xbox 360. Take-Two sold the new game title through 8,300 stores in North America.

Reportedly, Take-Two sold approximately 13 to 14 million units on the very first day. Grand Theft Auto IV had sold a total of 13 million units over a one-year period. Take-Two is set to launch the new game in Japan and Brazil, which will further boost top-line growth going forward.

Grand Theft Auto V has received rave reviews from critics and game analysts. The game received "M" rating from ESRB, which means mature. The new game also includes access to Grand Theft Auto Online , which will be launched on Oct 1, 2013.

The success of Grand Theft Auto V brings new hope for the beleaguered video game industry. Retail sales have been on the decline for the last couple of years due to significant competition from free-to-play games and digital distribution.

Video game retail sales in August increased a modest 1.0% year-over-year after a long gap. Although software increased 21.0% year over year, hardware sales plunged 40.0% due to lower spending on old consoles.

Both Microsoft and Sony are set to launch their new consoles late this year. The successful launch of Grand Theft Auto V suggests that there is pent-up demand for pure console games. We believe that the upcoming release of big console titles such as Battlefield 4 and Call of Duty: Ghosts will benefit from this demand in the holiday season.

We believe that the strong unit sales of Grand Theft Auto V will significantly boost Take-Two's top-line growth in 2013. Moreover, it will improve its competitive position against the likes of EA and Activision going forward.

Currently, Take-Two has Zacks Rank #1 (Strong Buy).



ACTIVISION BLZD (ATVI): Free Stock Analysis Report

MICROSOFT CORP (MSFT): Free Stock Analysis Report

SONY CORP ADR (SNE): Free Stock Analysis Report

TAKE-TWO INTER (TTWO): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: ATVI , MSFT , SNE , TTWO

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