Analyst expects Houser brothers to receive huge Red Dead royalties

UPDATE: Take-Two clarifies that last year's royalties of $383m shared across all studios

Update: Take-Two has since clarified reports that Rockstar will receive $538 million in royalties with the majority going to the Houser brothers.

That figure is actually for across all of Take-Two's labels. And a company spokesman denied that the Housers will take a majority of the internal Rockstar royalties as speculated by analysts.

Chairman and CEO, Strauss Zelnick then added in a statement: “We have a profit-sharing arrangement with Rockstar Games. Thousands of team members benefit from the profits generated by the games that they create. I am incredibly proud of the entire team at Rockstar Games, and Red Dead Redemption II is a masterpiece.”

Original Story: Sam and Dan Houser are due a massive windfall by the end of the year, thanks to today's release of Red Dead Redemption 2.

Bloomberg reports that analyst Gerrick Johnson from BMO Capital Markets estimates Take-Two's royalties will reach $538 million in 2018 following the Wild West epic's launch, plus the ongoing success of Grand Theft Auto V.

Last year, Take-Two issued $383 million to its labels, including to Rockstar's more than 2,000 employees, according to a company spokesman.

While the firm did not say how much the Housers received, Johnson estimated the two brothers will have received the majority - and expects them to do so again this year.

Bloomberg reports a lawsuit filed by a former employee - likely former GTA lead Leslie Benzies - alleges the Housers and 'a few key insiders' share half the profits Rockstar receives. Benzies is actually suing Rockstar for $150 million after allegedly being forced out of this royalty pool, but suffered a setback in his case earlier this year.

Analysts expect Red Dead Redemption 2 to sell more than 15 million copies worldwide by the end of the year. However, the run-up to launch has been mired by controversy over working conditions behind-the-scenes.

Dan Houser's claims that select staff were working 100-hour weeks kicked off a massive debate about the firm's practices, with numerous former staff saying the amount of overtime expected created a culture of fear. Rockstar disputes these claims, insisting that overtime is not mandatory.

FURTHER UPDATE: We originally reported Take-Two issued $383 million in 'internal royalties' to Rockstar Games. The publisher has contacted to clarify that this was spread across all its labels, and we have amended the paragraph above. Take-Two declined to comment further.

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Latest comments (3)

Ross Erickson Sr. Product Manager, Aristocrat Technologies3 years ago
Hurray for them. Yay - they started a successful company and success product line. And now they're making bank.
What's your point with this article?
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Rockstar Games is the most loved name in gaming similar to Disney-owned Marvel or Pixar in Hollywood. Great one, well deserved. Take-Two could even spin it off into a publicly traded company years from now -already owned it for 20 years-.
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50-60 million copies lifetime number.
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