Take-Two Posts Wider 3Q Loss on Grand Theft Auto Debacle

Take-Two Interactive Software Inc. (TTWO), showing the effects of the controversy surrounding sexually explicit content that could be unlocked in one of its key video games, on Wednesday reported a wider loss for the third quarter and further lowered its outlook for the full year.

The quarterly loss amounted to $28.8 million, or 41 cents per share, versus a loss of $14.4 million, or 21 cents per share, a year earlier. The result was within the lowered outlook provided by the company following the announcement of a ratings change to the hit game "Grand Theft Auto: San Adreas (search)."

In July, the company said the Entertainment Software Rating Board (search) raised the game's rating to "Adults Only 18+" from "Mature 17+" after disclosure that unauthorized software could be downloaded from the Internet to modify the game's content. Analysts surveyed by Thomson Financial were expecting a loss of 38 cents per share.

Sales increased 6 percent to $169.9 million from $160.9 million, meeting the company's revised forecast, although shy of analysts estimates of $175.6 million.

Take-Two shares dropped $1.48, or 6.1 percent, to $22.68 in after-hours trading.

Take-Two also said it was further trimming full-year estimates due to a delay of the launch of "Grand Theft Auto" in Japan and of the release of "Bully" for Microsoft's Xbox and Sony's PlayStation 2 into the next fiscal year. The company added that it has moved up the launch of "Sid Meier's Civilization IV (search)" for personal computers into the current fiscal year.

Take-Two lowered its forecast for earnings for the year to 85 cents to 90 cents per share from $1.05 to $1.12 per share, and for sales to $1.22 billion to $1.27 billion from $1.26 billion to $1.31 billion. Analysts were expecting earnings of $1.13 per share on sales of $1.31 billion.