Michael Pachter Quotes (52 Quotes)

The earlier movers aren't making a decision between the two.

The year's a mess. None of us thought six months ago the holidays would be so weak, and no one expected there'd be such a dramatic decline in sales for the current-generation of games.

I don't think there are four million people in the world who really want to play online games every month. World of Warcraft is such an exception. I frankly think it's the buzz factor, and eventually it will come back to the mean, maybe a million subscribers. It may continue to grow in China, but not in Europe or the U. S. We don't need the imaginary outlet to feel a sense of accomplishment here. It just doesn't work in the U. S. It just doesn't make any sense.

The company continues to invest in its future, generating large losses along the way, and we expect this to continue throughout 2006.

They can manage in a down-3 percent market because they've done it for years, ... That just means mom-and-pop stores are going to disappear.

Warcraft is so good and so good-looking that it got this immediate attraction everybody who would ever consider playing an online game said, 'This is the one. I gotta try it.' And what'll happen is inevitably, like the health club model, after you pay your 30 bucks a month for 3 or 4 months and you only go once a week, you realize it's not worth it and you split. That's what will happen with Warcraft ... I think it's going to roll back to a million. I'm not predicting it's going to happen in three weeks I'd guess it has a half-life of 6 months to a year,

The number of units is a manufacturing constraint,

I think they are very close to the edge with the banks. If the business plays out the way I think it will play out, they won't trip the covenants. I think they are not giving themselves enough cushion to weather a downturn and it makes me hesitate in recommending the stock.

We believe that industry sales have been quite weak since Take-Two's late October negative preannouncement, primarily due to consumer malaise and a shortage of Xbox 360 hardware... Given weak November NPD sales and Electronic Arts' and Activision's recent earnings warnings, we believe that Take-Two likely experienced weak sales during the holiday period, as consumers continue to shun current generation games while waiting for next generation consoles.

We expect modest growth in November and dramatic growth in December,

I think selling studios is not the right move. The first thing the company should do is shut down everything in Europe. Bruno (Bonnell) is out to lunch. ... The guys in the U.S. make games. The guys in Europe just sell them.

There are many, many things that are happening that are not normal.

We believe that January sales may have been even worse had Microsoft continued its marketing push, and believe that sell through was helped in part by deep discounting of new releases during the month. January marked the fifth consecutive month of software sales decline, and we expect a return to double-digit sales declines in February, with an accelerating rate of decline in March.

We note that NPD U.S. retail video-game software sales data for the January quarter implies that Take-Two's sales are down 40 percent compared with the prior-year quarter, so we believe that the company is likely on track to meet our revenue and earnings per share estimates for the period.

I am skeptical that we are going to see content that even comes close to harnessing the power of either box for the next several years. It's like using a 3.2 gigahertz PC or a 3.4 gigahertz PC for word processing -- it's not going to make much of a difference.

We think that the decline in overall sales of current-generation software in December indicates the beginning of a trend that will persist well into 2006, and we anticipate double-digit declines in current-generation software sales for the first half of 2006.

The best business for a publisher is to give people what you know they want. And what you know they want is a sequel to what they wanted last time. So we don't see a whole lot of innovation.

Sony's people have bet the entire future on this, ... It's too important for them to lose, so they will do everything they can to win.

Every now and then a company will come up with something really innovative and they'll sequel it to death.

I think the SEC is very likely trying to understand what industry practices are and see if these guys have the potential to manipulate earnings,

One reason they didn't make my number was because they added so much to the reserves.

The worst effects of the transition lie ahead. Although we expect a brief respite from double-digit sales declines in April, when Microsoft is likely to double the supply of Xbox 360 hardware units, we expect a return to software sales declines over the next several months.

I'm surprise that the navet of the NFL and its players, ... By giving a five-year license and giving EA an exclusive, they're going to eliminate all of the competition. So in five years, the license fee is going to be whatever EA decides it wants to pay.

I guess that is the equivalent of betting 25 of your stack on four hands of blackjack and busting each time.

The amount involved is so small, I think they sent a strong negative signal to the market for not a lot of money.

Nobody at Take-Two will have the guts to put any hidden sexual content in any game so people are making a bigger deal out of this than is there, ... At the end of the day, the stock is really cheap and the discount makes no sense.

Although Midway continues to generate large losses, we continue to believe that Midway is a potential turnaround story. The company's cost structure suggests that it can achieve profitability at revenue levels of 300 million annually, and we remain confident that Midway will be able to generate revenues at the 300 - 800 million level over the next several years. However, to achieve this level of revenues, the company must continue to expend resources on growing its development capability.

There are 5 million people who really believe they are getting an Xbox 360 relatively soon, by February. Microsoft has shipped 500,000 units, so 4.5 million people are doing nothing. That's enough to just kill Christmas.

We believe that speculation about a potential leveraged buyout is unfounded. If anything, Take-Two's disclosure that it may require additional capital to fund next generation game development suggests to us that it is not an LBO candidate.

We do not expect a current generation Xbox price cut from Microsoft this year, notwithstanding the company's stated intention to 'support' the current generation console. We believe that Microsoft's production cost of the Xbox is higher than the current retail price, precluding further price cuts, and we also think that the company prefers that consumers buy its next generation console when that box is introduced.

Nobody comes in to bid on that. They wait for the body to stop twitching, then swoop down and pick the meat off the carcass.

The analysis is significant, insofar as Take-Two's overhead has dramatically increased over the last five years.

... like the health club model, after you pay your 30 bucks a month for 3 or 4 months and you only go once a week, you realize it's not worth it and you split. That's what will happen with Warcraft ,

I think they are being appropriately conservative about Christmas because it's November 1.

Most of the press are fixated on video games. They think Sony is only in a battle with Microsoft. Sony is in a battle to make as much money as possible for the privilege of putting entertainment content in a Sony format. They already have a large group of people paying them for video games. They want a large group of studios paying them for movies.

We expect a price cut for the PS2 later this year. We believe that Sony will respond to Microsoft's introduction of its next generation console with a cut from 149 to 99 some time before the November 22 Xbox 360 launch, ... We think that Sony has positioned itself to lower price by reducing the production costs of its console when it redesigned the box to a smaller format... Should Sony choose to discount the PS2 to 129 or even 99, we would expect a dramatic lift in PS2 hardware sales, and a corresponding lift in PS2 software sales. Our model forecasts that Sony PS2 hardware sales will be 1.8 million units higher this year compared to last year.

You're going to see the Revolution as the second console of choice in the household.

If they paid more than 200 million, then I seriously question their judgment.

Take-Two has always been a 'trust us' story. We think that Take-Two has become a 'show me' story.

What everybody needs to understand is Sony is not competing with Microsoft. Sony's competition is with Toshiba.

The question is, How many of those who didn't buy a 360 in December will now wait for the Sony Some will.

They clearly aren't in the big leagues. They're back in the minors now and we'll see if they can build the business back up.

It will limit the success if they're not materially better than the current-generation games. The analogy is, do you buy a new PC if you don't have a reason to You just don't do it.

Clever and different and new doesn't necessarily work unless you convince consumers that they really want it.

Spielberg is a magnet to bring in talent. He will get all of Hollywood to start thinking about video games. Now you've got the guy who's got a guaranteed 300-million box office thinking about it. It's a big plus.

We believe that Midway's recent share-price weakness is more attributable to a slow down in purchases by its major shareholder than to a downturn in its business.

It appears that 2006 is following a similar pattern to 2000, when the last console transition began. Consumers have slowed purchases of current generation console software while waiting for the opportunity to purchase an incredible next-generation console, the Xbox 360, and its associated software.

It was a perfect storm. One could say it was a bad strategy I would say instead of bad it was a very risky strategy. Essentially, they played blackjack and put a quarter of their money on each hand and busted every time.

The reason we play football (games) is because of the identification with the players. The reason we update is because we care that Randy Moss isn't with the Vikings anymore.

After April, we expect monthly next generation software sales to remain fairly stable at around 100 - 150 million through October (representing year-over-year growth of 80 - 130 million), with declines of current generation software sales expected to remain at around 130 - 150 million monthly. We expect relatively flat sales through the summer months, with potentially robust sales in November and December, once next generation consoles from Sony and Nintendo are launched.