Grand Theft Auto IV, the latest version of Take-Two Interactive Software's gangland video game, generated a record $500 million in sales during its first week in stores.
Sales beat the $300 million benchmark set by Microsoft's Halo 3 in September. Stores sold six million copies of Grand Theft, including 3.6 million, worth $310 million, on the first day, Take-Two said Wednesday in a statement.
Take-Two is depending on the game to restore the company to profit and encourage investors to resist a $2 billion hostile takeover bid from Electronic Arts, the largest game publisher. Take-Two has reported losses for more than two years.
''We expected this to be a hit, and the magnitude of the hit is a pleasant surprise for us,'' Chief Executive Officer Ben Feder said in an interview.
Take-Two fell 3 cents to $26.32 at 12:12 p.m. New York time in Nasdaq Stock Market trading. Before Wednesday, the shares had gained 52 percent since Electronic Arts made its offer, now valued at $25.74 a share, public on Feb. 24.
''Many analysts have said that has bound the share price, but the magnitude of the game sales have to factor into how people think about the company,'' Feder said.
He declined to comment on whether Take-Two is holding discussions with Electronic Arts or any other possible suitors.
The sales probably will give Take-Two leverage to resist the bid or insist on a higher price, said Mike Hickey, an analyst with Janco Partners in Greenwood Village, Colo. He forecast retail sales of $1.2 billion by the end of 2009 and said Take-Two will keep about 80 percent of that.
''This game has legs because the quality is there,'' Hickey said.
Hickey had projected first-week sales of 5.8 million units and $360 million. Take-Two surpassed the estimate partly because it sold a higher-than-expected number of special editions, priced at $89.99, compared with the $59.99 price of the regular game. The company also benefited from currency exchanges from foreign sales, he said.
Grand Theft Auto IV has been praised by reviewers for its graphics and play that allows gamers to depart from the story line. The Parents Television Council, an organization devoted to limiting sex, violence and profanity in media, called the game ''brutally violent'' in a statement last month.
In the game, former soldier Niko Bellic is lured to the United States from Eastern Europe by a cousin who brags of great wealth. On arrival, Bellic discovers his cousin lied and actually is deep in debt to gangsters. He reluctantly takes on assignments from the mob to save his relative.
Grand Theft Auto IV has a ''mature'' rating from an industry council, which says it's appropriate only for players ages 17 and older because of graphic violence and partial nudity.
Redwood City, Calif.-based Electronic Arts began a $26-a-share tender offer on March 13, after Take-Two refused to negotiate in February. The offer expires May 16. Electronic Arts, which makes the Madden football games, lowered the bid after Take-Two investors approved an incentive plan that increased the shares it would have to buy.
