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'Grand Theft Auto V' remains chief moneymaker for Take-Two

Rockstar Games' "Grand Theft Auto V" is the gift that keeps on giving for parent company Take-Two Interactive Software Inc.

The game, which originally launched in September 2013, has sold more than 90 million units worldwide, Take-Two Chairman and CEO Strauss Zelnick said during a Feb. 7 earnings call for the company's fiscal third quarter 2018.

Moreover, 2017 was the best year ever for the game's online component "Grand Theft Auto Online" which exceeded performance expectations and remained the single largest contributor to consumer spending during the company's fiscal third quarter.

Zelnick also highlighted data from the NPD Group, according to which "Grand Theft Auto V" was the No. 3 selling game in terms of units in 2017 and No. 6 selling game by revenue based on combined U.S. digital and physical sales across the PC, console and portable devices.

SNL ImageRed Dead Redemption 2
Source: Rockstar Games

Rockstar Games' next game, "Red Dead Redemption 2," will launch Oct. 26 and is set to lead record bookings and record net cash for Take-Two's fiscal 2019, Zelnick said. The sequel to the 2010 action-adventure video game was originally set to launch in the fall of 2017 before it was delayed to the spring of this year and then again to the fall.

"Rockstar Games felt more polish was required and naturally we're in favor of that decision," Zelnick said in response to a question about the delays. The CEO added that he is confident the game is on track to meet this release date.

Meanwhile, "NBA 2K18" also managed to deliver better-than-expected bookings during the holiday quarter, with more than 8 million unit sales to date. Published by Take-Two's 2K Games unit, the latest entry in the annual basketball franchise will mark the company's foray into a professional sports league.

"We are very pleased with the progress of the NBA 2K League and look forward to expanding our presence in competitive gaming, which has a long-term potential to enhance engagement and to be a meaningful driver of profits for our company," Take-Two President Karl Slatoff said during the earnings call.

Take-Two also formed a new publishing label called Private Division, which is the publisher of simulation game "Kerbal Space Program," acquired by the company in May 2017. The company expects Private Division to be a meaningful contributor to revenues and profits in the long term, Slatoff said.

Take-Two on Feb. 7 posted net income of $25.1 million, or 21 cents per diluted share, in the fiscal third quarter, compared with a net loss of $29.8 million, or 33 cents per share, in the year-ago period. The video game publisher booked an incremental income tax expense of $11.9 million, or approximately 10 cents per share, as a result of the new U.S. tax law.

Net revenue rose to $480.8 million in the quarter that ended Dec. 31, 2017, from $476.5 million in the year-ago period. Digital online net revenue, which accounted for 54% of total revenue, rose 8% to $258.4 million from $240.2 million in the year-ago period. Total net bookings slipped to $653.9 million in the third fiscal quarter from $744.8 million in the year-ago period. Of these, 40% came from net bookings from recurrent consumer spending.