Take-Two skid leads Communications Services sector losses

On Monday the weakest S&P 500 sector was communications services .SPLRCL, and that sector's biggest percentage decliner was Take-Two Interactive Software TTWO.O, which was last down 6.8% after falling to its lowest level since June 16.

According to Benchmark analyst Mike Hickey, the selloff is possibly related to speculation around Grand Theft Auto VI, which is published by Rockstar Games, a Take-Two subsidiary. Rockstar has announced that GTA VI would be released on November 19.

Hickey noted the wide circulation of a Forbes story speculating about when the online version of the popular game would be released following the single-player version, which comes out in November. A spokesperson for Take-Two did not immediately respond to a request for comment on Monday.

Forbes wrote that Rockstar had said nothing about the release date for the online version of GTA VI so far and suggested that this could imply a massive delay.

"Our view is that this seems unlikely: based on GTA V, we would expect Rockstar to reveal the online experience around October and launch it close to the base game, although a longer delay remains a risk," said Benchmark's Hickey.

While he said that the base game should generate substantial upfront sales, Hickey noted that "online is expected to be the longer-term recurring-revenue opportunity."

He also noted that Rockstar is not behind its prior timetable.

"GTA Online was fully revealed only 33 days before GTA V launched and went live 14 days afterward. Applying that cadence to GTA VI would suggest an online reveal around mid-October, so the article’s one-to-two-year scenario is speculation rather than a reported delay," he added.