Yes, Take-Two's share price rose after the stolen Rockstar data was released, but don't read too much into it
Summary
This week's bump in share price isn't nearly enough to make up for the loss it's taken since January.
Rockstar Games was hacked earlier this month, and given an ultimatum: Pay up a significant amount of cash—$200,000, apparently—or all the stolen data gets released into the wild. $200 large is couch change for Rockstar, but there's also the principle of the thing to consider. Rockstar refused, and the hackers made it rain with their ill-gotten data—which turned out to be something of a wet fart.
It was interesting, for sure: Rockstar earns half a billion (yes, with a b) per year on GTA Online, and PC players account for a very small portion of that, less even than players on the old Xbox One console.
But the anticipated GTA 6 treasure trove simply wasn't there: Rockstar said when the hack occurred that "a limited amount of non-material company information was accessed," and it sure wasn't kidding.
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Take-Two's share price took a nice little bump over the next couple days, jumping from a close of just over $201 on April 13 to open at nearly $208 on April 14, and then after settling at $205 at close on April 14, bouncing again to more than $210 to open April 15, and climbing through the day to close at $214.38. Not bad!
(Image credit: Yahoo Finance)
But, I think it bears noting, also maybe not as spectacular as it might appear at first blush. It's been a pretty good week for Take-Two, but year-to-date the company is still way down from where it was trading in January, when Take-Two's share price surpassed $257—a drop of more than 16% from January 1. Not good!
(Image credit: Yahoo Finance)
At least one analyst attributed the short-term boost in Take-Two's share price to the data leak reminding us just how much money the company makes on GTA Online—it really is a monster. And it's undoubtedly good news, for Take-Two's marketing plans at least, that no GTA 6 data was revealed.
But how much of a material impact that absence had on the big picture is very hard to say, because there are so many factors at play. At the end of January, for instance, Take-Two and other game-related stocks took a notable dip when Google rolled out its world-building AI thing called Project Genie; like most other sound-and-fury AI sales pitches, Genie doesn't actually do anything useful at this point, and Take-Two CEO Strauss Zelnick did his best to shrug it off, but the company's share price took a knee to the bits anyway.
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Take-Two's next quarterly financial report will happen in early May, and that's where things will get interesting. Another GTA 6 delay is always possible, and maybe we'll finally get an official PC announcement, although given what we saw in that leaked data I'm not holding my breath.
But as Zacks Equity Research (via Yahoo Finance) notes, the money people who actually drive these graphs up and down will be looking at other things:
"Investors will be eagerly watching for the performance of Take-Two Interactive in its upcoming earnings disclosure. On that day, Take-Two Interactive is projected to report earnings of $0.58 per share, which would represent a year-over-year decline of 46.79%. In the meantime, our current consensus estimate forecasts the revenue to be $1.55 billion, indicating a 1.94% decline compared to the corresponding quarter of the prior year. TTWO's full-year Zacks Consensus Estimates are calling for earnings of $3.91 per share and revenue of $6.67 billion. These results would represent year-over-year changes of +90.73% and +18.16%, respectively."
What does that mean? Very broadly and basically, if Take-Two surpasses various financial forecasts, people are happy and the number goes up; and if it does not, people are sad and the number goes down. Unless a guy who calls himself deepfuckingvalue kicks in the door and screams "Stonks!" at the top of his lungs, I suppose, in which case all bets are off and nobody will be able to explain why even as multi-billion-dollar hedge funds are incinerated in full public view. (This is why I generally stick to game delay announcements.)
Speaking of which, we'll be tuned in when Take-Two makes its next financial report in May, and we'll let you know if anything interesting happens.