On August 8, 2024, Take-Two Interactive Software Inc (TTWO, Financial) released its 8-K filing for the first quarter of fiscal year 2025, ended June 30, 2024. Founded in 1993, Take-Two consists of three wholly owned labels: Rockstar Games, 2K, and Zynga. The firm is one of the world's largest independent video game publishers on consoles, PCs, smartphones, and tablets. Take-Two's franchise portfolio is headlined by Grand Theft Auto and contains other well-known titles such as NBA 2K, Civilization, Borderlands, Bioshock, and Xcom. Zynga mobile titles include Farmville, Empires & Puzzles, and CSR Racing.
Performance Overview
Take-Two Interactive Software Inc (TTWO, Financial) reported total net revenue of $1.34 billion for Q1 FY2025, a 4% increase from $1.28 billion in the same period last year. However, the company posted a GAAP net loss of $262.0 million, or $1.52 per share, compared to a net loss of $206.0 million, or $1.22 per share, in the prior year. This performance fell short of analyst estimates, which projected an earnings per share (EPS) of -$1.37 and revenue of $1.353 billion.
Key Financial Metrics
Take-Two's total net bookings grew by 1% to $1.22 billion, compared to $1.20 billion in the previous year's first quarter. Recurrent consumer spending, which includes virtual currency, add-on content, in-game purchases, and in-game advertising, remained flat and accounted for 83% of total net bookings. The largest contributors to net bookings were NBA 2K24, Grand Theft Auto Online, and Grand Theft Auto V, among others.
| Financial Metric | Q1 FY2025 | Q1 FY2024 |
|---|---|---|
| Total Net Revenue | $1.34 billion | $1.28 billion |
| GAAP Net Loss | $262.0 million | $206.0 million |
| Net Bookings | $1.22 billion | $1.20 billion |
Operational Highlights
Take-Two's management highlighted the company's solid first-quarter results, driven by engaging new game releases and content updates. Strauss Zelnick, Chairman and CEO of Take-Two Interactive, stated,
We achieved solid first quarter results by engaging our players with exciting new game releases and content updates, while also maintaining our focus on efficiency. Our management team remains confident in our path forward and we are reiterating our Net Bookings outlook for the year of $5.55 to $5.65 billion."
Challenges and Future Outlook
Despite the revenue growth, the increased net loss poses a challenge for Take-Two Interactive Software Inc (TTWO, Financial). The company is revising its outlook for the fiscal year ending March 31, 2025, with total net revenue expected to be between $5.57 billion and $5.67 billion. The net loss for the fiscal year is projected to be between $757 million and $690 million, translating to a net loss per share of $4.33 to $3.95.
Take-Two's future lineup includes several anticipated releases, which the company hopes will drive sequential increases in net bookings in fiscal 2026 and 2027, ultimately enhancing long-term shareholder value.
For more detailed information, please refer to the 8-K filing.
Explore the complete 8-K earnings release (here) from Take-Two Interactive Software Inc for further details.
