Weak earnings expectations are no obstacle to watching Take-Two Interactive Software (TTWO.US)! Investors are betting on the game masterpiece “GTA 6” to start a new cycle of growth

The Zhitong Finance App learned that the stock price of Take-Two Interactive Software (TTWO.US) surged nearly 13% last week, the best weekly performance in nearly 5 months. Investors are making early adjustments to their position layout just before the game company announces its second-fiscal quarter results after the market on Monday.

Take-Two Interactive Software's upcoming second-fiscal quarter earnings report may indicate a decline in its performance. Wall Street currently expects Take-Two Interactive Software's second-fiscal quarter revenue to drop 16% year over year to US$1.66 billion, and adjusted earnings per share will drop 33% year over year to $0.97.

At the same time, however, investors expect that the Take-Two interactive software will announce more relevant details before “Grand Theft Auto 6” (“GTA 6”) goes on sale on November 19. The company may even reveal pre-order data for the game's most anticipated title in recent years.

The predecessor, GTA 5, is one of the best-selling video games in history, and has sold over 230 million copies since its launch in 2013. In August of this year, Take-Two Interactive Software said that the company observed that the market demand for the “GTA 6” game had reached an “unprecedented” level, but the 2027 pre-order revenue guidelines were not adjusted at the time, and it remained at 8 billion to 8.2 billion US dollars. At the time, Take-Two Interactive Software expected reservation revenue for the second fiscal quarter to be between $1.62 billion and $1.67 billion, lower than market expectations. This indicates that the company's business continues to face weak pressure due to a lack of new games other than the “GTA” series.

Last week, Macquarie covered Take-Two Interactive Software shares for the first time, giving it an “outperforming market” rating, with a target price of $300. The investment research agency said that with the launch of “GTA 6,” the Take-Two interactive software is entering a phase where profit growth and free cash flow generation capacity have accelerated for several years.

Meanwhile, investment bank BTIG lowered the target price of Take-two interactive software from $313 to $262 to reflect the weak performance of the mobile game business data. The bank also lowered its performance forecast for the “NBA 2K” series.

On the Stocktwits platform, retail investors are “bullish” about the Take-Two interactive software. One user said, “Take-Two interactive software has dropped 17.7% since the last earnings report, and management says pre-order demand for “GTA 6” is unprecedented.” Another user said, “GTA 6” will go on sale on November 19, and the net pre-order revenue guideline for fiscal year 2027 is $8 billion to $8.2 billion, which means an increase of about 20%. Operating cash flow is expected to exceed $1 billion. I bought it at the current price before the biggest game in the game industry's history went on sale.”

Another user wrote, “Unless Strauss Zelnick (CEO of Take-Two Interactive Software) releases pre-order data, the stock price is likely to drop. But in any case, I think the stock price will recover lost ground within a day or two and hit a 52-week high before the game goes on sale.”