Updated from Monday's stock price
NEW YORK, (
) -- For the second time this month,
has slashed its financial forecast, this time due to the sale of its distribution unit.
The video game shop said Monday that it was selling its Jack of All Games business to
for $36.5 million in cash, and up to $6.75 million more based on unspecified achievements.
The removal of the business will cut Take-Two revenue by more than half in the fiscal first quarter ending in January. The company expects to book between $90 million to $140 million in sales for the quarter, excluding the Jack of All Games proceeds. The company had previously expected sales in the range of $235 million. Analysts had been looking for $227.3 million in revenue, according to Yahoo! Finance.
The company also updated its bottom-line prediction calling for a net loss of 50 cents a share, or a nickel more than the company expected just three weeks ago.
earlier this month when it warned that it would swing from a profit to a steep loss as business deteriorated. At the time, the company said it expected to have an adjusted loss of about 45 cents a share for the current quarter ending in January, well below the 26 cent loss analysts were expecting.
Take-Two, which makes games including
Grand Theft Auto
Major League Baseball
, has blamed a weak retail climate for its troubles. The second downward revision to guidance comes as other players in the sector such as
haven't been as severely affected by the same issues.
"The sale of Jack of All Games is consistent with our stated intention to focus our resources on our core business strategy -- delivering globally the most innovative and creative interactive entertainment products," CEO Ben Feder said in a press release Monday.
Take-Two shares were down 3.5% to $9.10 in premarket trading Tuesday.