Investing.com -- Shares of Take-Two Interactive (NASDAQ:TTWO) fell by 3% in pre-open trading Thursday as the company’s stock reacted to its closest peer, Electronic Arts (NASDAQ:EA), revising its guidance downwards. The market move reflects concerns that the challenges faced by EA, particularly in their Global Football franchise, could have broader implications for the gaming industry, including Take-Two. EA is currently down 17%.
EA, known for its popular sports titles, had initially projected mid-single-digit growth in live services net bookings for fiscal year 2025. The company has now adjusted its forecast to a mid-single-digit decline, citing a significant downturn in its Global Football segment, which had previously enjoyed two years of double-digit net bookings growth. The revision comes after the franchise’s early positive performance in the fiscal third quarter failed to maintain momentum.
The impact on EA’s Global Football is notable as the franchise is expected to finish the fiscal year with a mid-single-digit decrease at the midpoint of the new forecast. Additionally, EA reported that the Dragon Age series engaged around 1.5 million players during the quarter, a figure that is nearly half of what the company had anticipated.
Take-Two’s stock movement today suggests investor concern that the issues affecting EA may also influence Take-Two’s performance. The gaming industry is closely interconnected, and negative trends in one major company’s franchises can often lead to broader market skepticism about sector peers.
The decline in player engagement with major titles like Dragon Age and the adjustment of growth expectations in EA’s live services are likely contributing factors to the market’s reaction. Investors in gaming stocks such as Take-Two are sensitive to shifts in consumer behavior and market trends, which can quickly reflect in stock valuations.
Today’s stock movement for Take-Two underscores the importance of industry trends and peer performance in shaping investor expectations. As the gaming market continues to evolve, companies like Take-Two will need to monitor these developments closely and adjust their strategies accordingly to maintain growth and investor confidence.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.