Put on your game face
You can't go wrong if you're a video game maker these days. Activision (NASDAQ:ATVI) inched higher on Thursday after raising its quarterly guidance. The day before, Take-Two Interactive (NASDAQ:TTWO) shares rose even after the company hosed down its expectations for the current quarter.
I guess we should explain that Take-Two didn't simply talk down its fiscal first-quarter prospects. The company also reiterated its full-year targets, waxed positively about its pipeline, and pretty much let us all know that the video game industry will be a market darling for the next few years.
Making games is a lot more lucrative than making consoles. Sometimes the hardware makers will take a subsidized hit, hoping to recoup it in software royalties. The game makers have it easier, enjoying high margins once they've recouped the games' development costs.
The future will get even brighter for the companies, now that digital delivery of episodic installments, in-game advertising, and in-game accessory purchases will fatten hit titles with minimal overhead.
It really is like shooting fish in a barrel. In easy mode.
Briefly in the news
Let's take a quick look at some of the other stories that shaped our week.
- Publishing software giant Adobe (NASDAQ:ADBE) was quite the acrobat when it coupled a healthy quarterly report with an aggressive share-repurchase announcement. It brought new meaning to the company's proprietary PDF file platform: Pretty Darn Fantastic.
- iRobot (NASDAQ:IRBT) landed a deal with the U.S. Army that could be worth as much as $286 million over the next five years. iRobot makes consumer robotics like the floor-sucking Roomba, as well as military robots like the bomb-detecting PackBot. At home and on the front lines, iRobot sure does a lot of sweeping.
- You've got to like the friendly ways of XM (NASDAQ:XMSR) lately. The company settled with record label Universal over the use of XM satellite receivers that can rewind and replay music. Playing nice as it tries to win support for its merger with Sirius (NASDAQ:SIRI) is the right thing to do, even if means kissing up to corporate. If that doesn't work, it can always kill 'em with Oprah's kindness.
Until next week, I remain,
Rick Munarriz
