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NBA Lockout May Prove Damaging to Take Two
Interactive Bottom Line
by Perry H. Rod,
Published: October 10th, 2011 9:07 AM EDT
While Take Two Interactive (NASDAQ:TTWO) CEO Strauss
Zelnick reiterated on his company’s last conference call
that the implications of an NBA lockout were unknown and would not
affect company guidance for their related NBA title, NBA 2K12 has
quietly hit the market this week. The only problem is it has
been a little too quiet with sales appearing to be less robust than
last year, when Take Two made a splash by having NBA legend Michael
Jordon appear on the game’s cover for the first time.
Now, Michael Jordon is making his second appearance as the cover
athlete. However the title, which was listed at
#5 and #6 on the Amazon.com overall bestselling chart last
year, debuts at
#11 and #13 during the same weekly period this year. This
may be surprising for some, since the pre-order bestselling
placement of the title on Amazon.com in September 2011 ranked
similar to its September 2010 pre-order sales. Yet, today,
the title appears to be falling fast on the Amazon chart, quickly
sinking below the top 30.
Company guidance for the quarter is highly dependent on the NBA
title, as analysts expect a healthy non-GAAP profit of .34 per
share during the quarter. Last year, the company posted a .52
profit during the period mainly from a profitable 2K Games title
called Mafia, as well as the NBA title, which was the top selling
overall title in October 2010 according to the NPD Group.
When asked about the potential impact of an NBA lockout this year,
CEO Zelnick suggested Take Two would wait and see if the potential
lockout would have any impact on game sales.
"Given…
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