In Take-Two Interactive‘s (TTWO -1.57%) recent quarterly conference call, CEO Strauss Zelnick commented on the company’s approach to its most important upcoming game — Grand Theft Auto VI (GTA VI). Here’s what the executive had to say about the video game:
We’re seeking perfection, and when we feel we’ve optimized creatively, that’s the time to release. There is inherent tension, potentially, between getting something to market and creating perfection. But this company errs on the side of perfection.
The first trailer for Grand Theft Auto VI was released in November and stated that the game would debut in 2025. Given management’s sales and cash flow guidance and the fact that Take-Two’s 2025 annual fiscal term ends March 31, signs point to the game releasing in the first three months of next year.
But Zelnick’s comments about making GTA VI perfect before its release suggest there’s a possibility the game could miss that release window. Is Take-Two Interactive stock still a buy?
Long-term investors shouldn’t sweat a possible GTA VI delay
Zelnick’s commitment to perfection when it comes to GTA VI is an implicit warning. If it looks like the upcoming video game is poised to fall short of that lofty goal, it wouldn’t be surprising to see it slip beyond its previously implied release window.
Notably, it already looks like the game’s release will be a little later than the company originally thought. In the quarterly conference call it held last week, management announced it was lowering its bookings target for fiscal 2025 from $8 billion to $7 billion. That suggests that the company thinks the title will release sometime in March.
If a substantial delay were to be announced, Take-Two stock could see a significant pullback in the near term. On the other hand, such a scenario wouldn’t necessarily mean all that much for the company’s long-term stock performance.
Zelnick is correct about the importance of making GTA VI as good as it can possibly be. When it’s ready, the game stands a good chance of being this decade’s highest-grossing, most profitable entertainment release.
Keith Noonan has positions in Take-Two Interactive Software. The Motley Fool has positions in and recommends Take-Two Interactive Software. The Motley Fool has a disclosure policy.
