Perhaps you’ve heard: A video game called Grand Theft Auto IV comes out tomorrow. Game critics (yup, they exist) are already extolling the game as the year’s best, and the New York Times’ game critic (yup, the NYT has several), who says he has spent 60 hours (!) playing the game in a Manhattan hotel room (!), calls the game the best in the GTA franchise.
So GTA is going to sell just fine. The question: Will it sell well enough to save publisher Take-Two (TTWO) from being taken over by EA (ERTS) at $25.74/share?
TTWO chairman Strauss Zelnick seems to think so: He’s argued for months once investors see how well the game sells, they’ll bid up TTWO shares and force EA to up its offer. We don’t think so: We think GTA sales are already built into the share price. But if the game blows away expectations, that might change. Here’s what analysts are predicting:
- Michael Pachter, Wedbush Morgan: 6 million shipped in first week, 9 million for 2008
- Ben Schachter, UBS: 6-8 million in first week U.S. for the year, 10.5 million total for the year
- Mike Hickey, Janco Partners: 5.8 million shipped in first week
- Daniel Ernst, Hudson Square: 13 million in 2008
If TTWO sells 6 million games in the first week, that will translate into about $360 million in retail sales. Microsoft’s (MSFT) Halo 3 did $300 million in its first week in late September, but that game was only released for the Xbox 360, whereas GTA IV is coming out for both the PS3 (SNE) and Xbox 360. When should we expect to see sales numbers? Microsoft released Halo numbers for the first week 9 days after the game came out; if TTWO uses the same schedule we should see results around May 8.
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