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Take-Two Interactive hurt by delay of Grand Theft Auto 4 |
Listed in: PS3, Xbox 360 Tags: Michael Pachter, Take-Two Interactive
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Frustrated with the delay of Grand Theft Auto 4? Well, probably not as frustrated as Take-Two Interactive. Not only has the company taken a financial hit due to the delay, it also has to keep burning up more cash for the game's development until it can be released.
The success of the game could also determine the fate of the company. "Video-game development is not getting any cheaper," as CEO Ben Feder once said. The company has already restructured its operations in an effort to cut costs.
Last January, Take-Two still had US$ 138 million in assets, but this decreased to US$ 61.62 by the end of July. The company has also increased its five-year revolving credit facility up to US$ 140 million from its previous US$ 100 million.
The delay caused Take-Two to drop its revenue forecasts for the year from US$ 1.25 billion to US$ 1 billion. Analysts predict that if it continues at this rate, Take-Two might have to draw from its credit facility by January or February.
Despite it all though, analysts are optimistic that Grand Theft Auto 4 (Xbox 360, PS3) will be successful. Michael Pachter, an analyst from Wedbush Morgan, predicts that the game will sell 10.5 to 11.5 million copies in the first year of its release.
Via TheStreet.com
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