Why Some Smart People Think You'll Be Playing Grand Theft Auto V By April

There is no release date for Grand Theft Auto V. There are no confirmed platforms for the game. All we have is one trailer and two screenshots, but some of the people who follow the business of the publisher of Grand Theft Auto, Take Two Interactive, are convinced the game will be out before the end of March.

Here's a jargon-filled explanation as to why from the oft-quoted stock analyst Michael Pachter, a man known by those who follow the gaming press for lots and lots of predictions. This comes from his latest note to investors about Take Two:

FY:13 guidance implies the release of Grand Theft Auto V in FY:13 [Note from Kotaku: That's Take Two's fiscal year, which runs from April 1, 2012 through March 31, 2013]. Management expects revenue to more than double yearover-year in FY:13, with non-GAAP EPS [Earnings per share] increasing from a loss of $US0.71 in FY:12 to a profit of $US1.75 — 2.00 in FY:13. In addition, FY:13 guidance includes an estimated 1H [First-half] loss of $(1.46) — (1.31), which implies 2H earnings of $US3.06 — 3.46. We cannot construct a scenario in which Take-Two could generate the revenue or EPS needed to achieve FY:13 guidance without GTA V, given the highest combined EPS for two consecutive quarters in Take-Two's history was $US2.46 (Q2/Q3 2008). We expect GTA V to sell at least 18 million units, representing a 20% attach rate to the estimated 2011 year-end installed base of PS3 and Xbox 360 in the U.S. and Europe. At this level, we estimate that Grand Theft Auto will generate at least $US2.65/share in incremental EPS, making Take-Two's full-year forecast attainable. Should the game sell 24 million units (in line with its historical attach rate), we expect contribution of more than $US3.65 per share in incremental EPS. Importantly, the company has a history of providing conservative guidance, and without a GTA game, we would not expect management to be so bold as to provide FY:13 earnings guidance of $US1.75 — 2.00. Also, we believe that the game's developers are unlikely to risk delay very far into CY 2013 and battle declining current-generation software sales in the face of the potential introduction of next-generation consoles that year or the next.

Translation: Take Two expects their current business year to get a lot better by the end of March 2013 and it doesn't seem like the boost they're expecting could be wholly attributed to how well Pachter thinks X-Com: Enemy Unknown, Borderlands 2, NBA 2K13 and BioShock Infinite — all games planned for release between now and February — will do.

Pachter is not alone in predicting a looming GTA V release. On a conference call yesterday, another analyst, Mike Hickey, asked Take Two boss Strauss Zelnick about the "believability" of GTA V coming out by the end of March, something Hickey said Wall Street expects it based on Take Two's financial guidance for the year. "We just haven't talked about a release date," Zelnick said. "So obviously we can't talk about the credibility of a release date that we haven't announced."

Are these guys underestimating the possible success of Take Two's announced games? Or are these folks who are paid to understand what Take Two means when it predicts its earnings on to something? It's strange that a potential March release of GTA V would not yet be announced by Rockstar, stranger still that Pachter has even predicted that the game will be out in late 2012. The latter is hard to believe, but it's clear that the financial folks expect GTA V in the next eight months.


Comments

    I think Pachter's wrong on this one (he's been spruiking this "theory" for months now) surely a new Bioshock and a new Borderlands in addition to NBA2K are enough to see 2K in the black.

      It's an odd one... GTA history points to October, but recently Rockstar games hit in May, the type of revenue they are talking about is really GTA revenue.

      Borderlands 2 will be big, supposedly the companies 3rd most pre-ordered game, NBA 2K13 will only really be big in the US and despite Bioshock looking like a good game, I think it will tank compared to their sales forecasts (it will still be a strong seller, but not as big as everyone thinks).

      Rockstar North are due though, with GTA IV out in 2008 and RDR in 2010, it's still possible they shock announce and release this year, forecasts are met and everyone is happy.

      Otherwise, expect all the revenue to shift into their next FY and bank on a late Apr or May release in 2013.

      Scratch what I said here - I've just watched this http://www.youtube.com/watch?v=myA76Hvtg3k this dude from IGN says they actually stated they expected 55% of their predicted revenue to come from Rockstar!!! That's GTA V!

    everyone go buy more take 2 games so they don't rush GTA5 and bollocks it. lols

    Rockstar north didn't make Red Dead Redemption, and people are saying that since they haven't announced anything and most games need a good 6-12 months stream of announcements, but dont understand that Take Two can release the game tomorrow and it will still be a smash hit.

    October 31st is my big guess since Take Two has promised there investors big profit margins in Q4 so that can only be from a GTA release.

      Working for an american company myself, their financial end of year is early next year. Q4 might be in context of that and not the actual calendar year. Possibly :)

      If the R* North portion was directed at my comment, I know technically San Diego were the lead, but RDR was co-produced.

      So even if you exclude that title from North, then they haven't done anything since the Episodes in 2009, the engine is built, they just needed to refine it, they've enough time to polish the game, there is no way it could be considered rushed.

      If GTA comes out by suprise there are gonna be a lot of rival companies who are pissed off!

    Christmas 2012 is my bet.

      I think they have had too much success in recent years with the May time frame to differ from that. My guess for AU/EU is Friday the 17th of May, 2013. Out in the US on Tuesday the 14th of May.

      Previous AU/EU dates: -
      RDR May 21st 2010. LA Noire May 20th 2011. Max Payne 3 May 18th 2012. I don't see them breaking this trend.

    Not just smart people but also Michael Pachter, too! :P

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