Take-Two Interactive Software Inc posted a quarterly profit as sales of its hit sports game NBA 2K11 helped it weather a year without a new version of its blockbuster franchise Grand Theft Auto.
Shares of Take-Interactive rose 7.5 percent in after-hours trading on the Nasdaq on Thursday.
The company reported net income of $53.8 million, or 58 cents a share, in its fiscal fourth quarter ended October 31. In the same period a year ago, the company posted a loss of $23.5 million, or 30 cents a share.
On an adjusted basis, the company posted net income of 67 cents per share, beating analysts' estimates of 31 cents, according to Thomson Reuters I/B/E/S.
They are blowing out expectations, said Janco Partners analyst Mike Hickey.
This year marked the first time the company has been profitable in nearly a decade without the release of a new Grand Theft Auto game.
They've always been plagued as a one-trick pony because of 'Grand Theft Auto,' but now they've shown how successful they can be with another massive hit, 'Red Dead Redemption,' Hickey said.
The company attributed the improved results, including an increase in revenue of 32 percent to $373.7 million, to brisk sales of its basketball game and the first-person shooter game Red Dead Redemption. Analysts were looking for revenue of $325.23 million, according to Thomson-Reuters I/B/E/S.
The company, which is changing its fiscal year to end March 31, expects to post earnings per share on a non-GAAP basis of 25 to 35 cents in the three months ended December 31. Revenue for the period will likely range between $290 million and $315 million.
For the year ended in March 2011, Take-Two expects a profit excluding items of 50 to 65 cents a share on revenue of $1 billion to $1.1 billion. This is above the forecast of 47 cents a share on revenue of $1 billion by Arvind Bhatia, analyst at Sterne Agee.
Bhatia said investors are looking ahead to Take-Two's fiscal year 2012, when he expects a new edition of Grand Theft to be released and when there will be no overlapping months because of changes to its fiscal calendar.
Shares closed at $11.94, down 0.5 percent, on the Nasdaq on Thursday.
(Reporting by Liana B. Baker; Editing by Tim Dobbyn and Matthew Lewis)