‘Grand Theft Auto VI’ leak sends Take-Two stock lower

Yahoo Finance’s Daniel Howley joins the Live show to discuss stock performance for video game company Take-Two Interactive amid the online leak of ‘Grand Theft Auto VI’.

Video Transcript

[AUDIO LOGO]

JULIE HYMAN: Shares of Take-Two Interactive are lower this morning, although not by as much as they were earlier. This, after a hacker leaked footage from the development of the company's anticipated video game, "Grand Theft Auto 6." We've got Yahoo Finance's Dan Howley here joining in this conversation. Dan, who covers the video game industry closely. Dan, why was this such a big deal?

DAN HOWLEY: Yeah, I mean, look "Grand Theft Auto" is one of the largest properties in video gaming history, of entertainment history really. So it is the cash cow that Take-Two relies on. And you know, just to give you an idea, "Grand Theft Auto 5" is still being-- having-- being updated with new releases coming out as far as downloadable content. And those still make tons of money for the company. That game came out in 2013. So just to give you an idea of how long the investment process is for these games.

Now, they've been working on "Grand Theft Auto 6" since around 2014. And so the idea that the early footage that's not completed in any way or, you know, refined in any way, was released is a big disappointment. Video games tend to not leak. We usually get introduced to them in these big splashy events that come out where we see, you know executives on stage, showing off footage, things along those lines.

But just to give you an idea, we did get a statement, obviously, from Rockstar Games via a tweet, essentially saying that they're disappointed that this is the way that the game has come out. And that they're gonna continue to work on it. And that they hope that gamers are still as excited when they reveal it under their own terms.

Now, the hacker here apparently says that they're also the same person who hacked into Uber. There's no real way to confirm that at this point. The Uber hack seemed to be more about just saying, look, your security is subpar and I managed to get in through social engineering. There's no word on how a person got access to this kind of data from Rockstar Games yet, though.

BRAD SMITH: Dan, maybe you can help educate me on why it matters that a hack, that a leak of this magnitude took place. Of course, understanding how popular "GTA" has been over the years. But for a leak like this, does that diminish the number of players that might want to see it or want to play it, rather? Like, what is the impact and what's being anticipated that we're seeing the Street try to price in, too, even before the opening bell rings?

DAN HOWLEY: Yeah, I think it has more to do with the anticipation being kind of dulled, potentially, from people looking at the screens and them not being what you would expect from a big, splashy game that's been being worked on for years. Now, you know, Rockstar, known for pushing out these incredible titles-- incredibly immersive titles. The last one they did was "Red Dead Redemption 2" that was of that magnitude.

But you know, I think when a game comes out and they have a huge event, it really does kind of get people more jacked up to play the game, for lack of a better phrase. And I think that's really what you're kind of seeing here is people saying, well, you know, this isn't the way we wanted it to come out. But that, by the way, doesn't mean that there's going to be any issues with the game itself or that the game isn't going to be incredible, as a lot of people likely anticipate.

I think it's just the fact that it's not coming out on Rockstar's terms or Take-Two's terms and the fact that there have been hacked. And there's a question of, you know, does this impact the development cycle for the game? Does it push it back even further? I think that would really start to spook investors to a degree.

JULIE HYMAN: So Dan, take a step back here and take off your corporate reporter hat and put on, I guess, your reviewer hat for just a second. I'm just curious what you thought of the footage that you saw? Like, are people right to be taken aback or disappointed by this little leak here?

DAN HOWLEY: I don't really think so, right? When it comes to early footage, it's not exactly what you're expected to see of a game. We usually see, you know, companies release prereleased footage that's not even from a game engine, meaning that it's not the game itself. It's a CGI, you know, movie that they've made for a game. And then they release that and say, this game is coming. But it's not the game that you're going to play. It looks completely different.

So I don't think that people looking at, you know, from my own perspective as a gamer, looking at prereleased footage is going to turn me off at all. Just knowing that it's going to get better is actually a good thing. You know, if that's the takeaway for a lot of gamers, I think it's just going to be, look, this game is coming. That's great. We've wanted to see more about this game. And, oh my God, it's finally on the cusp of becoming a reality. So I think that's really the big deal.

BRAD SMITH: [LAUGHS] And so in that case, the network intrusion was really just-- saved marketing in this instance here.

DAN HOWLEY: Essentially, yeah.

BRAD SMITH: Yeah.

[LAUGHTER]

All right, Yahoo Finance's own Dan Howley, Thanks for breaking this down for us, all things "GTA" and the hack that took place. We'll see what this means in the gaming space and if it deters some future gamers as well. Yahoo Finance's own Dan Howley, thanks.