The largest entertainment release ever took place this year, breaking records for a variety of media. I speak, of course, of Grand Theft Auto V. The much-awaited video game sold some 29 million units in its first month, driving Take-Two's (NASDAQ:TTWO) solid profits for its most recent report. Yet the market's reaction was muted, as the flurry of media reports on GTA V's rabid success has led the market to price in much of the action. With competition from Electronic Arts (NASDAQ:EA) and Activision Blizzard (NASDAQ: ATVI), can further upside be expected ahead of the holidays?

GTA V was a blockbuster title by anyone's standards, selling more than $1 billion worth of copies in its first three days on the market. For comparison, it took Activision's Black Ops 2, the previous record holder, 15 days to reach this figure. Of course, the controversy surrounding its traditionally brutal adult content, rampant violence, and glorification of crime -- in other words, all the ingredients for a great video game -- aided the game's widespread popularity. As they say, there is no such thing as bad publicity.

The game's popularity translated into formidable top-line gains for Take-Two. GAAP figures weren't particularly impressive because they exclude the period's GTA V results, but non-GAAP results were quite spectacular. Second-quarter revenue came in at $1.27 billion, up from $288 million for a more than quadruple increase. Net income rose from $10.2 million last year to $325.6 million.

In any case, non-GAAP metrics simply blew analyst expectations out of the water, not dissimilar to the way a rocket launcher would treat an approaching rival gang member. On the back of this strong performance, the company raised its full-year sales guidance to $2.3 billion from a previous $1.88 billion. Still, the Street's reaction to the figures was lukewarm, with shares up only 1.5% or so in regular trading hours after the earnings report. Clearly, much of the news had already been priced in.

Heading into the holidays
Perhaps the only problem -- and I use the word "problem" relatively here -- with GTA V's success is that the company may have peaked a little early this year. Many gaming companies schedule releases and generally clean up for the year in the holiday season. The company still expects a strong showing from GTA V over this period, but much will depend on the success of its next-gen titles, which include the sports titles NBA 2K14 and WWE 2K14.

Competitor Electronic Arts recently came out with a fairly subdued outlook for the holiday season. While it expects some decent sales figures from its latest installment of the Need for Speed series, the early popularity of the latest FIFA title may lead to a slower holiday showing than expected. Primarily blamed for the poor holiday outlook was the less-than-stellar reception of its latest Medal of Honor title, which achieved an average review score of only 50/100.

Activision Blizzard, for its part, is mostly banking on the release of its latest Call of Duty game for some holiday cheer. Although the company has warned that sales probably won't top those of Ghosts, Activision is fairly optimistic about the console transition scheduled for the holidays. Designed to cater to a mainstream audience, the series has been reliably successful over the last few years and builds on a tried-and-true formula that still seems to appeal to gamers worldwide.

The bottom line
Take-Two's latest earnings report, boosted by enormously strong GTA V sales, smoked analyst expectations. Yet the market's reaction was fairly low-key as much of this sales strength had probably already been priced in. With the holidays around the corner, and despite the holiday offerings from EA and Activision, the company should expect some more sales going into the last months of the year. This could allow the stock to continue its great run.