Take-Two Interactive Software (TTWO) 21 May 202020 Q4 Earnings call transcript

Greetings and welcome to Take-Two Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded.

I'd now like to turn the conference over to your host, Mr. President Relations Vice Corporate Senior Diamond, of and Investor Communications. Hank you. Thank

begin. You may

and ended Financial thank Good will and results Executive Goldstein, discuss quarter to afternoon. be Lainie for President; and Officer; year you fourth joining Zelnick, Welcome Chief and led for by Take-Two's Take-Two's Today's XX, March XXXX. conference Officer. Strauss call the Karl Chief fiscal call our XXXX Chairman our its Slatoff,

following questions will remarks. our be session available the We prepared your during answer Q&A to

Before not assumptions we the and information like on to forward-looking would made by under to remind us. during this These everyone made as based begin, I are beliefs statements that of call historical forward-looking laws. available are statements that currently considered our securities are management federal statements well facts as

in We from Quarterly variety have vary factors. factors section may forward-looking no Report on these summarized most XX-K SEC a XX-Q, the in recent based on described Report update Factors. risks filings obligation operating entitled important on of the and including Annual statements. results Actual Form Risk including the to our these These with company's statements Form the forward-looking significantly are

otherwise like comparisons are stated, also that discussing year-over-year. numbers to would be note GAAP we will I are all all unless today and

financial items regarding order Additional in the uses results our that in operating our results including and our our release, management GAAP actual to our details outlook are to press contained performance. internally evaluate adjust

results slide that posted we visually have a presents addition, our financial to and deck our site Web outlook. In

Web the from with filings obtained release www.takeXgames.com. at our Our press site maybe and SEC

to will turn I Strauss. now, the call over And

afternoon you Good today. us for Hank. joining thank and Thanks,

our entire this for who world, lost lives and on lost begin, every like to around or their normal corner risk at healthcare management pandemic. the team societies condolences express those responders I deep In in and lives members our put of Before the ill, during behalf I preserve incredibly for of would we form colleagues life workers of grateful. their to are heroes the return take first which world, enable to and care the to of

also for to experiences keep the seamlessly to forward organization company environment, and shifting deliver audiences. work-from-home our I'm continue to moving best our of and to our proud entire successfully entertainment

Turning as our which net quarter during we than significantly business, concluded bookings, extraordinary of our including bookings well to spending year milestones earnings. digitally record record better numerous results as delivered and Take-Two, $X our expected billion net achieved nearly another for fourth consumer

Online our Grand quarter all including and the titles mobile Borderlands Auto X Point's X, XKXX, outperformed fourth Theft Nearly Theft of V, NBA just name Dead a Social few. to in Auto and Red games Grand Redemption

fourth significantly expectations. quarter with users daily sales engagement increasing remained users NBA recurrent our and both record XK at MyTeam on full with During outperformed NBA active and growing game nearly consumer the XKXX throughout of spending XX%. levels Consumer fiscal XXXX, XX%

quarter. over on the than were increase over NBA more X million representing game-play XXXX third a of quarter hours fourth Twitch watched the XK During channels, XX% across

engagement success growth positive This to a began consumer was prior in drops recurrent sheltering of primarily trend in resulted at spending driven strong of February decline. quarter, This fourth people by and expectation our MyTeam. the for content the reversing XX% home in

XK XKXX highest in over and XX% up sports the ever nearly will business. grew the bookings in same expect largest our title. of spending lifetime to that period, remained record, recurrent XX over NBA we consumer full the contributor the on for NBA NBA million XKXX and XX% now new to year net the a spending the is units NBA recurrent XKXX units, For XK consumer for franchise be Today sold part

issues prior for XK in addressing of the concepts and another record visual results. delivering thank to XKXX like an job with I'd NBA doing year incredible

in players XX Network. ESPN comprised As with the this our Arizona during COVID-XX pandemic, We're program COVID-XX Food support to raise XK XK incredibly NBA, the Bank response to initiatives. players NBA the and stars worldwide for partnered tournament those to include Association, of need among create funds part broader our NBA of the NBA proud unique

XXXX monthly The in positive month December Theft of the Diamond XX% full drive and periods. XXXX July records Theft momentum fourth for consumer superlative August growth to year update, grew exceptional both Grand and fiscal & XX% best of through helped spending Auto bookings. Online during both XXXX. Auto the and with the achieved the new continues and in from in each its recurrent engagement net Casino Since quarter launch Resort Grand players active then ever users March performance both Online sequentially This July for

title of of and over In in the generation. million sold title Theft console addition, Auto sales Grand have XXX must surpassed current our the further V now expectations is cementing its as the position units,

to gain quarter the the full Dead spending our Dead premium to expectations bundled tripled Net the the quarter content Red to-date fourth year, have million also than in Redemption engagement Both X exceeded excluding momentum. more recurrent continue Redemption in online and Red Dead Red than for additions. with in consumer on bookings and sold worldwide. fourth digital XX grew XX% more and units

Dead Online returning Grand Auto engaged. content year, and more with Games and Red both Online excited keep coming and support will to to Rockstar the Theft updates new continue players Throughout

X in over quarter same outperformed installment fourth latest our million shooter an on up including Steam in was the Borderlands is defining of March in exceeded in period. expectations game genre of XX, X the released sales were now looter the our array the XX the retailers series title PC projections. sold our over On and XX% X, Borderlands Borderlands units,

Marriage Pass paid Gearbox fourth be X are the Hammerlock, announced of launched Season the Love During The purchased second in X separately Wainwright that Guns, quarter & release. Borderlands Deluxe four Super and can Edition and the the XK Tentacles: campaigns of included and upon

the the in each Borderlands and month be due to and release franchise's attribute long-term. Steam. on part fans March to for consistent should users coming. and Borderlands of XKs the Gearbox over fourth continued to the claimed Pass a steadily Borderlands active X its highest XKs in game to since more monthly the continues weekly largest continue and during events, software's attached content support there's effort and in the drops that the with service with to Xs have the history launch players success quarter and We title the communication new influx with in as live content The Season series X benefit rate free

sold Worlds. selectively release to-date. critical immense the and X.X our core expectations their is Outer exceeded complement contribute launched commercial an example The to-date in and our portfolio with how meaningful with The successful a World title our is Division Private XXXX million fiscal Private of can During and success Outer than perfect significantly most bottom-line. results Division more units it's to

Our VI, enhanced by Point's fiscal by led Meier's and Social mobile NBA WWE other Sid XXXX the XK games, were results also Civilization of XKXX, a variety offerings series.

a consumer total of In recurrent our fiscal XX% to XXXX, bookings. grew for record and accounted net new spending XX%

enhanced NBA Red Dead by XK, addition virtual and Grand was recurrent other Online Auto offerings. Online spending consumer a In currency variety of Theft to for

and results, our Point Chef. Tasty well to games in play through category, Dragon the two City Legends and and Life, free as a Monster biggest significant quarter fourth expectations its remains Word outperformed Social Town the as to our In contributor World

XX Social its years. of innovative and than planned in invest pipeline to Point launch continues in for broad games more new coming the

mobile now title fourth our during SuperCard significantly growing online also title outperformed sports more and the XX% has and And full than title. game online times million XX The highest XK quarter one million users. PC quarter the grossing and exceeded in fourth been expectations, the XKs XX%. NBA more in XX% than China growing WWE respectively. number downloaded XX China remains registered year, The remains during with

XXXX XX% by XKXX. grew offerings for Meier's Sid Borderlands Add-on the content franchise, Civilization WWE and led fiscal VI in

to positively Finally, that is additional also which consumer results. Premium our spending include content sales of Borderlands recurrent X allocated Edition, to contributed

from its biggest history, including sequels franchises our ahead, exciting well our the development new as company pipeline strongest as IP. Looking has in

always XXXX of fiscal diversity we the Transition results live to offerings. console service While for our our be is expect to will for by and strength new and a new releases, push to ways year light development aspirations a catalogue new a due creative their very the a technology. our to industry exciting and level this strong to time taking new deliver teams cycle of are finding already limits

transitions be reflects the achievements year these bring a by particularly largest COVID-XX. can unpredictable, strategy speed release the flavor fiscal our to in creative our XXXX to of And up audience. our possible However, ended

them give achieve deliver quality to the resolute. highest and Our success commitment to optimal remains conditions titles

Karl growth detail will begin that to titles an in will discuss XXXX, have more this we sequential launch array year. expect drive which We of to fiscal that shortly.

recent at activities with to and from people should in results benefited There and people have their place to players family. is engaged no have that doubt and connections will sheltering connected once remain home results. The interactive communities benefit friends sought stay entertainment built and resume as normal our our continue industry's

positivity work time. in to bring can fortunate in industry difficult We're that the some an

of to proceeds of all April labels together charities from Take-Two's previously As worldwide. come May mentioned, portion deliver have a and COVID-XX to

over continued in Looking on creatively, to financially trends positive operationally ahead to and our and shareholders remains growth capitalize the long-term. returns deliver positioned for superbly and many Take-Two the industry our

I'll the Karl. call now turn over to

Thanks, Strauss.

Strauss world I'd and to to join uncertain who all at lost continue adversity our the and to loved difficult very pandemic. who Take-Two despite times. have this to expressing very We ones are are to colleagues dedicate mission facing around fortunate themselves like in have our global condolences those during

squad out strategy our of title X, X.X standalone released and title give addition and On Squad call unique whole Set received fans collection. and the fans including an after years has award-winning new out XK experience XCOM five reviews, for tactical series. X.X recent strategy. The Chimera new and worthy provides releases. XCOM a the for Chimera magazines stars XX, turn-based XCOM new Comics events and of a any of a turn-based dynamic who is from Firaxis said and XX I'll discuss April it players. games Rant, of Squad Screen Chimera strong five the and all upcoming an title dimension Now, gaming

the X and the all XX, new up, combines previous of available PC. Trilogy PlayStation into X by mechanics X Yesterday X, game Mafia from new Mafia while XK be a purchase the August package on currently game remade titles is delivered acting, including launched ground voice more. for the with and the trilogy, and development Mafia completely being will technology, Trilogy single studio. released XX XKs new three Hangar as One are Xbox Mafia The curated Mafia

six of part release PC. XXXX, tomorrow and March Xbox Pass Games new Civilization all New Meier's One, will XK Nintendo the begin bi-monthly content Sid through Switch packs VI, X, Firaxis downloadable as Starting and PlayStation and their Frontier for of

Later pack variety of gameplay Pass this Pass new to year, will Frontier a will and available leaders be New civilizations, Frontier will for The platforms and new come and New each individual mobile eight content. purchase. nine provide new modes the

Firaxis between that addition also and Games balance scenarios, provide free updates updates new Pass In more. will feature maps,

the On for Switch and franchises, offerings The May Borderlands BioShock: The XK XX, most successful popular their Collection. some and will Collection including continue Legendary XCOM with of X bolster Collection, our to Nintendo

In acclaimed June Switch. the driven Outer critically RPG, will choice release the the Worlds on for Private addition, Division X, player

the featuring an PC. sci-fi will elements available Developed shooter as to create real-time tactical for Disintegration well currently X, XX, co-creator and as digital multiplayer first campaign studio experience an One blends including June content founded person single array Disintegration independent launch thrilling by use is a frenetic entirely in gameplay. of Lehto. Private On Interactive, a for modes. multiplayer new Division cosmetic bonus Disintegration pre-order, is by player Halo for that VX PlayStation Marcus Xbox

Space July for European Program Early Private Space update on the which Squad partnership on a available update The and consoles. will this the Simulation for a space free Horizons on entitled is announced a Division Agency of new XXXX. be to X, this year PC week, players launch outstanding Kerbal be to Space planned Shared launch European update, exploration contribution critically with Space Horizons, Game. Agency's acclaimed will and the also later celebrates all Shared

licensed cover, Nintendo Xbox customization a and most online scanning gear, and pro player On societies. play-by-play studios, Tour Thomas and Switch, by Tour PGA Tour XX, XKXX will PlayStation the Luke Elvy Tour the for course officially PGA multiplayer, PC feature X, to-date, and players PGA online and commentary professional by will Developed XKXX new One, XK Rich and courses August HP Justin on local Stadia. course realistic career PGA Beem, mode, release

the offerings additional Borderlands coming will XK throughout content months X. NBA for release and addition, XKXX In

shortly. will details be Additional revealed

to Online gameplay open which Games Rockstar Dead And to Grand vast provide of will and for an and of worlds Online, Red records. set the engagement content continue experiences array continues Theft Auto

Collectively sports football as In with encompassing partnership of sports company. titles, the remains our The opportunity stable for for announced of properties game return themed partnership our renounced growth as games multiple NFL. expanding a of offerings an March exciting marks XKs well games. the to XK video the an expansion NFL,

XXXX. time, in release year game and launch will non-simulation projects specific we and dates over While fiscal can confirm these titles, experiences will be that during developers be starting football will revealed XXXX game calendar

successful business our extremely NFL in sports be We're in highly fun, back which and the be will deeply We're thrilled social confident that with experiences. engaging one is NFL, most offerings world. the forthcoming brands the to of

that WWE that Last visual timeline announced the experience development the next game opportunity production simulation create XK and the extending team it month the possible. be the to franchise best would concepts to for XK ensure has

style To completely new expand also over meaningful arcade our XK WWE offerings. experience that XK there and a and opportunity believe top environments We announced that designs, gaming is moves. WWE will that the Battlegrounds, end, a superstar to feature action

coming by, battlegrounds have the is this in it's being the about to developed behind more share fall. playgrounds, XK XK NBA XK games scheduled WWE launch to studio and will months. the

provide Program with Space next Program the the of the from the delays game of franchise. iteration at COVID-XX to release Private Space at Divisions popular to order moving the work Kerbal time space The Seattle to simulation remains need possible. on X, they the best XXXX Kerbal studio hard team fall Due we're experience new to team the in create

the are least the weeks their from YouTube information gameplay in as the their live X, markets XXXX remote and and May shared will XK of available. on simulcast becomes Twitch six All XK homes of XXXX teams be on the remainder with eSports surrounding XK participating began to at Details XX games regular league NBA season season, gameplay. its local Turning League schedule NBA season structure channels. NBA planning league in

be for We are continued progress driver growth long-term the company. to of a very potential excited and and has league, which the profits a of about engagement our to enhance

organization, investments the our order In build intellectual continue enhance property. portfolio we of significant to scale industry our of to to make leading

now our our content. strongest I'll visibility which provide only we pipeline, that not and long-term releases into are full the is in company's history. add-on game Note including

and mid-core XX experiences XX or franchises are XX XX casual properties. these platform existing the internally Across existing through five our for new XX XX and of are are titles, titles outside core gaming from release XXXX. including currently planned studio Of development labels extensions XX have titles arcade are the owned years experiences, over titles, and are XX style from experiences. fiscal XX next we intellectual partners of titles

PC also and streaming for In XX that the including planned on mobile are of be planned available are console for will seven specifically XX and/or platforms, terms mobile. titles of XX

titles that will slate. of adding that With through it are will to XX purchased respect our titles undoubtedly not It are XX that current and developed and snapshot our free some completion, these these the to business to figures are play. today. of reflect likely as to we pipeline required XX of a is Note stands models new be be games be

fiscal As be light release here. new mentioned, will a Strauss XXXX

sequential consumer expectation strong for However, given we resume XXXX. recurrent fiscal expect growth to and pipeline in our spending, increasing

in engaging the long-term around to new about platforms, the most company are channels opportunities the as In closing, models Whether new on is for well we into deliver value positioned consumers, expansion to distribution embracing experiences business and as entertainment of shareholders. exceedingly expanding markets XK well and margin excited for audiences our and capitalizing to many all captivating growth world. to and emerging our generate incredibly

the call over now Lainie. I'll turn to

Karl Thanks, good everyone. afternoon, and

quarter additional then our contained that and note review for will year quarter outlook results, discuss release. XXXX regarding fiscal fourth Please details fiscal in financial our first results I press and our and actual outlook and are XXXX. Today our the

express affected our those immensely been who to I of who would to proud have pandemic. our colleagues by world and of to both also organization my with my I'm and support like dedication the the around condolences also to continue COVID-XX the level utmost deepest professionalism consumers. business

during year fourth record which results Take-Two, achieved As quarter Strauss significantly expected better results. we for record are this mentioned than finished

Starting with million was the our outlook quarter. to exceptional This our result in million. the of $XXX driven as fourth to total million $XXX titles the fourth grew net performance outstanding XX% of compared quarter, to $XXX by bookings

spending bookings consumer spending Recurrent and grew of exceeded total of XX% outlook as growth. outlook due and XX% the Online. XX% Grand our consumer performance primarily compared to accounted for to XK over Auto Recurrent Theft net our record NBA

grew bookings the result XX% net our accounted to XX% outlook as exceeded the full of total and of outperformance outlook for delivered delivered This game spending digitally sales. consumer to our Digitally compared growth. over recurrent XX% and of due

quarter the from current delivered year. During up XX% fourth are XX% sales digitally console of in games last generation

of goods primarily net $XXX million per $XX compared GAAP to increased million $X.XX million. sold Operating in quarter $XXX by income to X% net cost share million to fourth share XX% Expenses $X.XX grew due to fiscal R&D revenue or and $XXX XXXX. higher GAAP and the increased to as to $XXX million per grew of expense or

exceeded Theft Recurrent XX% XX% the Grand a total V to This Online accounted record and of XXXX $X.XX This by NBA to Auto growth. spending record fiscal new XK, new outlook in growth billion. and of Grand result Borderlands for driven to grew record grew Turning net results, of was of our bookings XX% bookings. Theft and a total extraordinary Auto our breaking X. consumer launch net

to delivered too of total. This growth current grew due accounted exceeded new digitally a delivered bookings and spending game XX% full net our and record the to $X.X billion than sales. for for Digitally expected of consumer XX% better XX% of outlook

compared sales XX% million cash of unrestricted XX% of was outlook adjusted delivered of XXXX, million. from current Non-GAAP fiscal During $XXX our games console generation operating as last flow $XXX year. were digitally over up to

to Expenses net due spent During billion. year $XX At primarily was in we our to of end, grew XX% revenue fiscal XX% capital and GAAP increased cash R&D higher GAAP And and increased short-term over billion billion, per fiscal XXXX, cost investments to expenditures. $X billion. million marketing grew to sold income goods or $X.X $X $X.X net $X.XX by share. Operating and expenses. million, $X.XX to

strong a fiscal financial gave outlook we Today, XXXX. for

are increase an coupled the light operating us saw investment with outlook. fiscal our we schedule, and which the continuing home, in in is at reflected lower first Our to margins our expected currently further title with this improve consumer nature in social results engagement should experience pipelines trend our to than time. people over release to began be that enable and When positive future to scale shelter to the XXXX to quarter accessibility of online We're our products. continued

We additional which for delays affect or outlook included leases, deep have further of could results. the nor any the trend from our assumed this back year have in a half we our not in benefits recession

expected XK, and Dead franchise. This driven and million Now XX% $XXX million primarily million in to Auto from and from bookings Auto NBA X the last we fiscal Red the being Borderlands and from $XXX starting range Grand Online Theft net with our $XXX Online up Dead first growth year. first guidance, Redemption by quarter Theft projected to Grand is Red to increase V the quarter,

V, Redemption and be largest Grand Grand XKXX, Online net and to Theft and X. Auto Theft bookings Red Auto NBA are Dead X Borderlands Dead The Online to Red contributor expected

Auto growth recurrent XKXX. This We NBA grow consumer project spending by Theft our to is driven to expected be approximately by and XX%. Grand primarily Online

forecasts net XX% in game console assumes current expect around period that last of XX% We delivered our also digitally generation year. double, the to delivered our sales digitally be will same bookings

to and million, Expenses million are We to represents to range increase At over higher XX% $X million $XXX expect million we $XXX last by rates of from to $XXX tax year Operating this $XXX expect $XXX driven Management to from contribution. $XXX million. share. $XXX throughout $XXX income range per range from net GAAP GAAP goods a net million. expected XX% revenue our And cost or and is expected be to to purposes, sold R&D the from million to primarily reporting to fiscal million range $X.XX expense midpoint, XXXX. charitable to cents

our billion project to the outlook year. to billion. bookings for to from $X.XX net range full Turning $X.XX We fiscal

to expect Grand We and from lower results, Theft X, X V. offset be Dead growth NBA Red XK Borderlands Auto Redemption

in Redemption content Theft bookings Auto Dead with be excluding Online Grand net edition the expected XXXX. contributors to The Online projected Red fiscal are digital line and be XK, mobile Worlds. largest NBA are Theft bundled premium Outer Grand with approximately Red to VI Auto V, Theft Grand Point's Civilization and Dead Dead to and X the and Online game, Auto X, Borderlands Red Online, Social

labels to States net and XX% Point's. the XX% bookings breakdown Games, our and from net bookings and our expect be geographic we Social Division to And Private XX% XX% about be XK, United split forecast, International. XX%, Rockstar roughly We

in approximately recurrent Premium expected a be XX% Dead XXXX, Borderlands to NBA Edition. We as XK lower to allocated expect consumer consumer of and year. grow percentage The is our spending offset versus growth to spending X compared X driven primarily as consumer by flat XX% current to Redemption from fiscal last the by recurrent business roughly Red spending

project by X%. bookings about to digitally We delivered net decline

projected As XX% last up a is represent percentage of to business, year. from XX% digital

of current be games generation that digitally Our last will year. forecast from delivered up console assumes XX% XX%

cash flow expenditures. operating capital million to we than approximately We adjusted in expect and to in generate deploy million non-GAAP more $XX $XXX plan unrestricted

capital prior and spending on office and is IT build expense. The to year studio increase over expenditures in due out the primarily

$X.XX $X.XX billion. net revenue GAAP to expect from billion range arrange billion for to We and goods cost $X.XX sold to billion, $X.XX of

partially midpoint contribution. decrease $X.X range by At this Total and driven marketing X% the charitable the are a by R&D prior to stock compensation over $X.XX billion. represents and billion expenses, operating lower year higher offset expected expenses expense to

income from $X.XX $XXX We expect to share. per $XXX GAAP or range $X.XX million to net million to

In around our closing, that audiences better. services Take-Two, the be Fiscal opportunities our year another a standalone the ability providing incredible promises has year XXXX entertainment we're was world, to fiscal captivate times. XXXX connect and our on never or delivering great for engaging of experiences, serve live record whether for to to capitalize to well uncertainties and and been navigate many positioned organization these both the communities

We growth have excellence the strongest world-class development pipeline disciplined we our capital fiscal with assets, potential on in approach our expect company's XXXX, creative history the focus in and resume and to operational allocation. to

is growth term. the Take-Two expansion over and positioned generate to long margin significant

to Thank back turn Strauss. you. call I'll now the

Karl. Thanks, Lainie and

On behalf their work, excellence and outstanding year, particularly team, hard colleagues management for thank commitment our delivering to for under to like of these I'd circumstances. our entire their another

our for take want now to I your For shareholders, Operator? express your questions. our support. appreciation We'll continued

from first Colin Please with Thank Robert with you. your W. Baird. Our proceed comes question Sebastian question. Instructions] [Operator

all four question. hope year doing if on you the three that and linearity well. on period? a of helpful. That's bigger visibility And pipeline. wondering or add was quarter Congrats I the maybe planned could releases over time the strong Strauss And for very you are picture then, on thanks any a color also

know the is this more circles and world you open of right real most opportunity with I the the you. one given on any I environment. of As what I for in the think we've gen a business publisher going that. wonder there's if metaverse through, a certain horizon just now, successful if the next but wonder world's points Thank topical discussion type you for see been franchise, potential industry

it we existing sloping mean And or curve new tell And from and And of of great desire. intellectual reflects cash reflects there'll doesn't year, property. think every a we constant have plenty upward as expect is, releases, I that aiming coming are have is, what that year, gentle you're that really content in new put By fiscal you But as it. any greater asking answer and to franchises that. significant should be linearity, description, our Karl's flow? handful Colin releases of XX linearity bookings from could you net a the this we given year

is have launch with even have annual do The our even the a we're fortunate year a though then catalogue, strategy. to than well. good light news we light offerings, that, year, some to in to our have releases, a our is where service with strength, our and it's even not if a live with able great of strong And that goal better and can we of titles, than better title we have which were number as those have even and blockbuster our enough year,

biggest away, remain, year they if to out So, are out the that results, in our have they remain come you if titles. on are don't go I properties biggest to every think variability the the will when of can't ever some entertainment not They earth don't come every year.

view my still be our definitely It's goal on grow. smoother that's There So be some will to linearity. variability. to and

a question I anything love more broadly, really I answer more while to else. label your And question that's than think

we're As in better label these level at much that visibility questions doing creative into specific calls. the what future, in those labels. are the give and the we our the due as get into matters, we we'll nature we We by But answered to announce content as core of as can no, soon when on aim get time.

with question Sachs. Our Goldman Mike question. Ng comes proceed Please next your with from

think PC what completion rate help a just Thanks us increase in a the what for so XX just a what on or the games core years. you or been five the of relative you year, us the exactly games console in about said those think there past give something about gaming for done That's sense significant add-on has content question guys in next development average. output in had just I games just numbers? a This Could XX a I past? is visibility. over you else streaming pipeline in the experiences? much. you've Thanks. is to And can

question. Just of to your answer your last part

content on add those and include not did we First, numbers.

there's And So new much -- more and speaking, reflect necessarily gamers gaming core this those bigger means necessarily to lot to make, art really investments, because experience lower that. bit be to said games more expect of how to doesn't generally to budgets define on we core more but how be targeting is. going define IP. on not there full but are say they speaking, what is are is risky. tend our And an we releases of a And tend it, new we think really for the be investments to core it games development all new IP. bigger are largest new we can that engaging, that we a generally a but is you front before, mean IP as the

So games, there'll was. of really investments doing those of types wrong wide five Then because the that's kind about question, to commentate AAA releases including our five all where play things across core So at specifically anywhere what that range here. the are we're first And but it engaging really core experiences is the part looking of could update, of from take not a right? forget to time, way a for of be the talking you games hours minutes what it's it does probably that I investment. we're

was development about in in completion games of It the the past. go through typically percentage that

games out much, is rate of that don't have that on number Yes, much of completion a area have are are I specific Obviously, coming obviously you. a for there the existing don't that specific, I franchises, though higher. part

can you stages various in could be development, anywhere know, For XX% of the I might you know, you be something that stages that it new mean it IPs could and a from, in we've prototype just be prototype, stage, for time, of various I different of time, that development it depends. that And half or be got are really titles suggested. the in pipeline maybe

we all And just look, could And but new of case is that with also the to new it probably to things be assume added the to there. have we lot not slate rate numbers also a assumes stress all just we be franchises. was not the release case. IP be lower that IP, nothing it the existing going in to that going again, is have if completion those than gets to And expect out, the do more which you which that know come those projects

been this We this best. time. is, for before. is one So velocity. some our like up our we've this doing is And it. And us about pipeline really to talking important need that we're larger more this expectation keep quite had we'd a build We've that It's scale. way to for

Mario Our proceed next Lu your question. Barclays. question with from with Please is

level on NBA one have one I and high question.

what is you a NBA XKXX consumers the that fall Any average, XX your then, Strauss, vision hours on like So is that in of or past that through How NBA, on will and one happen on as of on shifted the time And those environment of watch slated still linear games. I increase suspended NBA and release will is COVID be you can the the entertainment to terms the XXXX. post-COVID to what hours year. the and spent video for TV current games? rest season provide mentioned continues and thoughts what in during look date XXX video noticed hours its calendar title, of

Sure. we're for the we've the hoping that with NBA obviously, past, have have This In starting NBA. all We've a Look, had season had not is is season. actually an going situation we we're past. on time. been And scrape through. Karl in history to NBA

that. we So have with familiarity

we be to kinds continue delays starting, in of even our wouldn't way, to don't in at different starting. seasons of light say the that business want the tend season You a to impact But or able in robust game it all. in

standalone we've of some season. don't that If experience, the we think obviously, reason, an is be we'll world NBA as game compelling hope for the So I got all around a basis and fine. us a

And this is Strauss.

about a XX%. us groups, engagement the Regarding which consultancy groups, during time with provided all media COVID increased place some All spent leading all gaming research. demographics, this with time in age has shelter Activate, just is period,

video, entertainment has spent time XX%. increased with linear about While

levels. research So to they're shows in about spent gaming what's about is increase sustained normal increase Linear entertainment their ballpark. time pre-COVID-XX at with increase X% people about grow interesting expect of since to video, in versus a XX% return once spent a an did that compared post-COVID, rate entertainment greater XX% sustained more. same time linear their routines, the with But they to

not that late, do to the that? entertainment shift to returned caused as think sea engaging, change look have outstrips a it's or to realize be potentially tragic and I in characters, of represents the interactive are it the the all they the sad depending is, I why seen it meaningful it. lines is sheltering for to going have think linear engaged people on course. think competitive favor at great are And I fun as not only of people not is with and in And around there friends growth begin going game, but entertainment. can meaningfully communities stories And diverge home, But we've only that we're entertainment, growth new also interactive interactive So beautiful, in see I trend not to that to is only only it entertainment, a and begin people world. think that and of it you entertainment. to has come

You those can new those you because you're with while people can them. world with all you playing can friends create around play And the communities connect games. and

clients. can to You playing them, talk you're over chat while

pre-existing So, have view, saddened view deeply trends. on this shift that one the the that growth trends of crisis. smart the moment is think for And in is a the and I accelerated all those the in is this We're what's interactive entertainment celebration. by by to going world. But, been not sector the

still we great sector we The going help execute make don't Now hits. that the have if every we in us games with is to said, deliver don't day. growth if to all not

question Please Our Wells question. next with Brian from your with proceed is Fargo. Fitzgerald

ask Thanks. about How as bit and to there's home are the as on problems because kind return to real side. places normal responding the dynamics, to if then development world meter regions get want kind seeing then work the back a then and you any that of as some hit lockstep are of Just to what and Asia-Pac? is what in from we your areas, through shift of hard getting no China on a around you to differentiating work regional see engagement basis,

so We delay. I'm regionally changes and the don't not sorry meaningful to we meaningful seen Brian. for were as Thanks, far working remotely. We see regions all work. differences have back have gone

in NBA registered XX% the sports XX example, And number year-over-year. China. now in it title remains up China users online has XK one For was PC million

in was XX% up quarter. the I it think

not we differences, significant head level back think is quoted, that It it to not research as that before. I expectation stay be seeing But I are changes not it'll as we things than this meaningful in do that the higher we year So engagement will to just seeing same are I people is. of it but return work, think normal. full reflected was the just

a systems. a And in And fortunate, in up Sandy we're a time really terms company addition working were not highly quite company, which to call had have company been when disaster prepared. ago, being then, of a we since look, from real is some is recovery. very but we state-of-the-art wake And home, during we've Hurricane we've on particularly compliant ever

front course, in increased when used to to needed. test XXXX that from people apart day after with in completely place desktops. out, have have crisis, a effectively XX. are because their we to much they sitting office And had then over turns on people set go with to right work-from-home could a their that, up them equipment working from all planned not got productivity, that as week have live anyhow, people know one in the if we online, we else completely the do it we working And of March see connected we this anything fact, In about home of

meet very the on Zoom. And three have we during we and largely this in with of with believe working difficult company's who uplift really as to who together. colleagues to time. working hard I'm connect teams. saw Three zones, time. very connected we're hope all talented, works people company. incredibly mission to them almost the it love townhall fortunate a group And everyone mission talking doing our different week our with mostly held time We're We're next this

we works gets start estate harder. So really it's well shutting everyone a as a But it's does gone that the But and it home. beat. that you And Over I expect missed miss harder. view will get down from incredibly not your I I'm we think haven't don't beat. it of still just time, effective. real

together no have a pinch work. effective to close substitute and it in you pretty I in no their to and like a think as connection. there's do where person it's for and great people choice see pull But as in obligation crisis this collaboration

with is UBS. with your Sheridan Please Eric question next Our question. from proceed

in game longer pretty couple What means the Maybe at sort given environment I can game seen the out increased another over ask you've answers back should far, you've about question of that more long-term the the levels development as or about current view way just it and of playing quality moving of short of to see in know backdrop, thinking to on interactive for over of all even manner the be engagement the And beyond they're long-term. again, also last thinking that maybe form months. may the over and Thanks entertainment the has some make term distributed the be for horrible the medium and content, of so long-term, a which of it's monetization of engagement of engagement. I much. or you monetization but what of period surge game capturing sure that changed time your so type

learned there have are can learn. already things and we sure that many I'm

about monetization when of care approach. first foremost. talk entertainment monetization, always And change to We do haven't a is seen itself. phenomenal our remember, them takes And we that a deliver that we our we and experience, goal massive if in figured

do naturally, monetization, need Our get goal talented colleagues with we the a We job to investors. paid It's our all constituents. care about not return we so our of proceeds our build appropriately is both. constantly share create our for and to to can

wouldn't So a we're call we're be for organization, aren't. the feed, organization, if charitable not we a on profit obviously

quality take entertainment best the the for out them for experience, you nature organization. axiomatic of the problem it. whether on people this experience experience. We the and we of a valuable intersection as that Earth, of show they something for for value put the that give feel, incredibly pay isn't is it it. We monetization that's receive When up an But you

a you incredible an phenomenal cost. go it to and have restaurant should bill, but If meal, have

You're not going back, Even it. inelastic. even if price if you can your afford

going It are not You doesn't feel good. back. just

sure increased company. we what With labels. always comes make So more of that's that's that engagement we that And of increased our than and with all goal the monetization. said, all to deliver charge the of our need we goal

effects results guidance. that in this You're in these and initial of seeing the

question. Bank Our America. is Gee proceed your of question from Please with with Ryan next

'XX you're for here AAA year share Couple that's that, per last for was the have quick I robust count would compared ones, doesn't I any what big Lainie, sports. as fiscal 'XX? one as as end. one earnings to why to, tax to is look maybe Lainie, know to then the going Karl. differences you guiding us difference fiscal new rewind on, XX, didn't fiscal call you rate and maybe titles for probably even to than maybe we 'XX, share noticed the higher at what's if the beyond or back two profit high but really fiscal margin the

ports the like can quick, is material with for Mafia it. that And It this with been on then, you new trilogy real past? a franchise game some quasi in us just remind has Take-Two and along Karl how sounds remasters

should So about what's Thank the type of we trilogy think you. the really 'XX? this game, opportunity in

can that it's sure numbers be tell going off don't R&D right now. of me, one is of those are be Hi, the numbers the to I expense definitely in I for higher top head my higher of but have Ryan. you much going front

and has the Karl titles we you've growing detail if worked has that seen titles we've about on the been our last pipeline of schedule talked our our years As -- coming five and release over significantly the couple about, in next have of that out grown something significantly. what years, has

And games. that's, that the look is is personnel expense, well expense the our of line. going grown affected just our is has as we expense, margin G&A operating expense And for business. that IT and overall And business our for overall, to online I development, R&D see for hire expense at the growing and as OpEx going bottom-line which as lot since cybersecurity, as our that an a for as the well through which

think the business. I probably the for where you're that's overall seeing biggest increase

Mafia about And franchise successful X, the X sold just has X incredibly In Mafia incredibly between idea, has also successful is terms in over opportunity, million units or while three. been of Mafia Mafia well. Mafia Mafia already of X, give Mafia for period Mafia time as long us X it's you a X and to an so.

tech, us. it improvements So it's for with remade. really much basically more to are that voice It's there's new but excited fully X completely are game. and new be to obviously been three games, than be Mafia We're a significant the occurring acting, going the is more a is going contributor a not that. but same about game-intend, lot that gimmicks really there's new going trilogy. there's be It the to The made,

trilogy. up bringing is quite into there going the bit a of work So that's

can titles of a way. success out, then just generation always different depending out though those the in to each fans not again, a they're new even even there's these And we've bringing collections. with had great new audience a experience the came enjoy catch. new brand always And where existing And there's that experiences, individual on

meaningful coming us out. excited franchise. We're as about a been it's the for So really trilogy

Stanley. with proceed Please Our question. is Nowak Brian your with next question Morgan from

GTA. on Two

people in entry GTA, there's Epic Store whether with barriers it's and versus recent and do on your think big big part into PC. XX earlier one for driving able GTA or those is reward Game recently? the to you following Thanks. NBA on where RCS extensions, ultimately platform Can such in for effects of some and mentioned a on thing free at up changed offering them driven to been all XK network to the about of charging V, thinking bringing on of getting monetizing these the is, about has obviously, the ecosystem came get So update then engaging just, people that something been GTA them of games, you free presumably, the business? up risk us How lowering an people the that recently, engagement for And call, you XX? access,

Brian Thanks for your question.

-- opportunities Obviously, old initial a offered was than I are we answer think online is the title. lower your that points sort an And have it's all price offering point. been V offering. at there price do good and Auto Grand its seven obviously of also that within above. question a Theft pretty release of monetization year

grow can specific users. do that specific So grow idea And engagement, will bookings with to the and with that believe come we more sense deals promotions specific outlets great behind grow will net in come a to them audience us. general with make And more it's profits.

it. in We're sense titles. they So available when limited for behind that very, was of time thesis those catalogue typically selective the very kinds make and only promotions periods of for they are

don't made any announcements aren't titles know labels. talk We that yet at those release. the new in leave to calls. reflected haven't we we these And today's you about as discussions specific And

question. proceed question next with your Todd Sanford Please Our Bernstein. with from is Juenger

who question about And gaming? who either by But time. this versus platform, can of When PC based or people or yet to major the that lapsed gamers think you lot. Karl you on going your I'd much understand whoever proportionally driven I like answer is it. new increased playing Appreciate mind Thanks you me either the you think that a help love versus Strauss any recently, franchises. to to engagement it come it, engagement are mobile, For one feels more hope differences way. don't perhaps, how explore gamers back back console have versus us perhaps existing versus in more by

Hey, it's Karl.

of really to of engagement, not we all people and don't all we gamers; you we both, but overly people but around they're It's back out And what if that. engaged I'm every publicity it there answer is, who probably really it it's coming, franchise, in. is track time to franchises going new track gamers; the of it's publicize We that. even people question it, is an the And things. to answer those satisfying, folks keeps new terms of that's engaged currently some it's new give In new it's and your coming back existing brings also back Because it franchise, content. the people that. keeps coming coming and brings with content, constant of a people new keeps in with ultimately in are the come release all

So it really all above. of is the

as relates avenues it pandemic. really with there us always the new to I models. are playing going to to bring so change much seen We're folks other in. open obviously, haven't And pricing But on specifically during that anything

of or mentioned away You period subscription things a we're oriented into certain like services things putting doing things giving for time.

came out, time us point data in promotional most that the look allows into get our continues getting really of isn't time. we We're in that in to price in still seen engagement? where just franchises generates at subscription of like experimental full a or player analytics these that service us, for games. I'd better And It maximize and future. economic What that real-time hopefully temporary analyzing all thing that our does All we've over new better. better someone to context activity does engagement How context price? for context show for And new like? and in investment and free really our coming do we're in opportunities. we're mode. and to who a things low And excitement That a to getting is, better compare optimize to we cohort see it paying well the our so a or what

Handler is proceed MKM question Partners. your with Eric with question. Our Please from next

pipeline healthy personnel is games given of And games fruition, wondering to come need the these effectively if everything well. distribute you scale a have could even everyone talk about that you these I'm of hope just games? games market do and in now, Strauss, little and I and at infrastructure. look place those terms have bit you to you in when if your you in of all half

do up I everything in we building development going still ask, place our to you teams. have were them, we thought to will develop be

operating highly have the margins, yes, I In for scale, mean, talked terms gross we've distribution, and about have in margins. already that one competitive, need of competitive we competitive marketing to of -- margins the reasons gross order

would operating have because with competitive that's margins you our But your operating overhead digital you fixed get those typically you net distribution. build here. include We level efficient reason margins, distribution to fully expect fixed of more success the a world your games moves already efficient with more don't higher of scale and bookings that I distribution need become overhead our the have as marketing and distribution is We mechanism. expenses. more and your highly up will the same goal

the our already your and development development all significantly, And you're of up, might headcount headcount seeing And that volume making the part yes, naturally, our goes increase that. with not expect marketing is with you of But you volume, cost game. modestly. expense that should

Great.

you you think about M&A versus and there's opportunities? balancing thinking you're are games it the from all need pipeline, industry or M&A follow-up, allocation seem about thinking external this to what it have a given all do given time. have an you developing be hand, for how lessens cash when Just you you But standpoint in the going doesn't capital much currently like at on as think you the about on the

our ways. three We in best capital still that different is used feel

that's no an exception. was story meaningful First, this organic We only this company incredibly which really acquisition, one to Point. been successful growth, done year Social support for is

paid a we've around And we've shareholders. great I'm The of opportunistic, second capital was if done is they've price to it buybacks, that done we and mistaken. think highest of deal $XX, And through support been ever I a selectively. the not return

far, reasonably well. So so we've obviously, called that

in growth sheet some there reserved would incredibly looking forward been And acquisition. And opportunity very will a Those by aren't the that deals. move selective opportunities. only of accretive We're for rubrics. capital very bring diversify We're lot possibility there talent. right; driven this of We're and company of our strong and then, you're potentially for intellectual property we've organic be balance that operations have and hopeful its our and disciplined.

us stay to but within they shouldn't expect diversify squarely We few of it. do between, those far And expect opportunities exist. to are entertainment, you outside interactive and

of And would operating to done highly right, be that benefit competitive have the margins.

of have that we means then reflect the we financial competitive thing margins. So we to results standing business, foolish obviously help success a our would the if then in and But in that for margins, way, of your again, and if won't But for best scale in is you. don't organization, and that benefit to you want you we margins. need scale thereby sake. scale. be highly scale have do, the the if not you operating scale, your ruining And buy buy us the can't gross way that it only And operating maintain

why sense, coming the of the soundly that's crisis make integrates acquisitions out And not smart. disciplined. for going post run we we has otherwise most relatively that way, then closing, opportunities in more tall it's to It there be of and business there would be another That's to why business certainly immediately. got it accretive the But fail. will view corporate than incredibly have it if order. you've are But may expected. we're you're do That's quickly, this order to so be and an opportunities acquisition, to has successfully be

Thornton Matthew question. from Please is question proceed next Our your with SunTrust. with

coming a have label, you but talked to first you one. if wondering breakdown pipeline if terms that back you have Maybe we I the account Wondering don't question of label by about think title earlier. just in discussed it breakdown,

times come question, total XK, is Is which count think that to or about five think everyone. Thanks, when curious growth look kind launch the Do will next how growth that like then, five NBA I blockbuster you business type the some over how five an year recurring of guess that we five Secondly, third bogeys or curious milestones over counted a blockbuster one this Strauss, counted the years. launch? think at titles, times Or recurring you a out And multiyear about when growth in obviously, lens? about look maybe it rate, over you time? is with at that you just just a frame timeframe? multiyear of

Hi. It's Karl.

-- Division, break how You're in share label. by the right. it We not releases We Social obviously of are from including are terms a have But they Rockstar don't there well. all XK, really releases all our down there Private from in labels. few labels to works. are did as that quite And of But breakdown anything Point that regard. the and

comes somebody of year, there's every out -- there's sequel pipeline. a a our that out if view if this is franchise So, comes our that entire

that yes, counted. be So would

look growth are less it's releases of we're solidity be. and also the much at looking for would. you could shareholders. initial because news is, bookings. it in terms We're than it exactly growth look in net we for at operators, we volatile in in we're EBITDA. investors, We're also reflects spending, We looking growth big business, recurrent consumer for way We're the looking growth, And good how

stock price. we're And finally, we're judged. our in growth how that's for And looking

all be. We're of largely as So we're on not total judged from economic EPS. an touched point we shareholder return on should it view

a it's no judged. we're hide. can team your to it. obvious that's think And with reasons fiddle as place you terrible around to management judge how I for there's Shareholder way return,

the the or that I with And and the price. it's So I scale correlated way it, flow, for earlier, said operating metrics, cash very stock well we've you look of at done quite course, because scale, way think and your those EBITDA, exactly indeed, some in your your time. of or your margins would profit operating operating on

your question. from comes Benchmark Please Hickey with Our next proceed question The with Mike Company.

was year obviously difficult environment. on 'XX, It's view a over your I and execution fiscal 'XX. the very curious solid economy your

it expect I'm unemployment a online didn't sales what at how I impact think you could see and you relates game factors look you said you of deep that recession. live or service But as your to recovery other sort curious guidance. or

Thanks, Mike.

had we've for back expectations period year. 'XX the been the not success that for adjusted have half the in of Our this tragic in fiscal recent

we continue prolonged equally, not spending level a we're counting of though, recession. to for on and this deep planning were engagement consumer not So

you recovery would where there middle, say we influence driven I'm is sooner opinions. if numbers a not an to is is personal, And own consumer is going we're my be, which don't probably right does my own rapid in But many when it. since the I dust My probably our had and we dust the view to the on think. people which call relatively than clear So peg to clears. plan we based optimist, see we're going that should it, can't

stable down I relatively unexpected that were ongoing by surprised, we influenced we would that massive were assume able and could a would and benefit there implement be consumer say we negatively there right middle, So was results we're economic conditions, results. and expansion if to recession, deep be equally that if not the could our

think I assuming we're stability. relative So

we the not have of enhanced likes are seen continued We recently. which assuming monetization, and engagement

'XX, half I to looks guys Thanks. fiscal of conservative, growth is you can sequential 'XX. like to That's for year obviously, first of good for 'XX? guidance quarter course, your year you talk noted, years helpful. and missed fiscal be very a but which broadly speaking, one for your in Last on Maybe me And your growth expectation for sort you the drivers tend thing. it, of

you there? think we upside to 'XX? 'XX over you. year in So grow there's expect Thank fiscal probably Do

Yes.

Sorry, I much not add. probably to think

year-over-year sequential investing release the schedule growth that expect in. and and in We fiscal driven Karl 'XX pipeline is by that that we're the described

of sequential coming some 'XX expect expect we growth. we in So that pipeline to and releases them generate fiscal out

as it's that. So simple

your with Our Doug Please next Company. & with from Creutz proceed Cowen question. question is

major XX Going you supported an there on the on. of multiple had years out sports most successful franchises were so lot a back league years golf, extreme was and so MOB, [ph] to tennis, there [in of your] there, XX sports ago, simulation titles,

are it NBA including few Presumably, in XK, that's the is the diminishing sports unit go to market, and titles their that You ones at it. the them on kind make by on became skin uneconomical hanging because in of today basically there of enormous way other are three with teeth and other numbers.

title. got PGA a You've

titles. some working NFL You're on

WWE. continuing invest in to You're

low down up are didn't you function getting Thanks. Is unit the the they X, see where exist, it X, level at that cost opportunities be opening X of in profitable something numbers, you years simply where to a can a or ago? maybe structure do relatively market think there

not drive business football. NFL football, is moving or with example the excited back most audiences for that before. before. in There been NBA to very We've that the world. or FIFA the in sports certain NFL the about We've going excelled in -- going we're Obviously, one with are the NFL into obviously the are brands you're to powerful of business get

space, into going to not very that bring the market. we're we're about we simulation Although can excited what

sports, think where now. bigger of opportunity we you're are need the market, is economics, that be right, you're expand to within to your not us smaller going you to able it to drive you there significant So some on spend out. that money But sports for other the we balance to kind just can of

by sports, need economics -- necessarily is between to to So development to popularity get that. but itself, because the people generate lot once game budgets. that you a But audiences, smaller is significant you're into mean sport smaller actually the correlation opportunity definition, of the and obviously to there not of there going it smaller not balance limited with doesn't it's

golf an for very, aren't over over who fans seen into golf think games. of people So we go that these and us very some sports that We've play is do to can again. opportunity and And well. there

economics with engage will the and a reasonable budget to them come. can course, the content then Of but we bring best consumer, to

from with Research. proceed comes your Stochel question question. with next Please Consumer Our Edge Ray

you more thinking you process. a yourselves that NBA. lot video that with smaller and tuck-in A head titles been in on lot has lot GTA high I or XX And in forward are plus look AA seen topic pipeline. in and at this how to investments years about I a you I'd even gaming, have really pipeline. you titles or of light content, love does there have titles of focus your seem scale of guess, of it success like your your or about know level the are question last if on guys so guess green And a growing

per PGA do titles for what think things you just in how like lighting about some titles that And structure could those a relative and talked what the the to look basis, of releases? sort we AAA So about addition about you're unit to are would scale? that unit green margin you lower something with upside like is and big economics the I guess, lead with talking those which on of eventually of NBA limit

from because IP leaned But in obviously think franchises. you you're we results our We've part, a know keep the is do still to hit approach well because have the consumer franchises industry, Take-Two such you fresh about your engagement your that never generated leaned speaking significant and franchise. by as to I IP is the in economic come we new next really to into going same in where got going think but new that with for in you're generally talking at is to how pipeline most right, you invest we've because those the can't way and powerful huge them. it's what critical driven invest

new in him the get always And doesn't I necessarily to have to Springsteen, like product a few album, be time portfolio, a IP chance a has releases him long to take to have enhance seek of successful. it Bruce even do it. mean, a to to happen to hit we're first use bringing the new there. out took you ways gold took to iteration. innovative it it So example our approach a to different I always continuing including that

these to need curate You titles. pro

out, many your is one us about, powerful, some of always for work idea such shots But as Do the iteration is it So is you is so don't but as an you idea And create way you can. great to that reaction, the lose grow a iteration. doesn't there maybe the is economically did. take something share. something after that kind in if first you then

we've that marketing about. expand we we So an push can franchise budget, development expand the what forward. invest audience, second got a that budget know one, development lot more franchise That's when that is and and all

and Auto one. the to don't Theft successful debt out the a an at Grand level in as NBA day same You have be come of or

we're it's never we're think you'll take efficient if anything take I the and have you doing. about very tempting, grown. our over no patient franchise about that's what there's a at have franchises, the approach, in that way and And ourselves mean, economically reason we that are there's because investment be and to take and it's shortsighted. structures But very, iteration I just release long because don't doubt that not enormous. our long-term. look be that's for mindful mean, we and go If new. the margin launch to every that view. development limiting it But and case, creatively release levels path we after I almost single the other They do

have recurrent immediately as and blockbuster do Can remain on think a pipeline of Auto, Grand you out mean, of path new have towards that in of separate, or do sort that do in expect you some studios spending about, jump? you your opportunity, attack you keep you do maybe you sort other be IPs putting a have some not all of out? I say, these off sudden that reposition resources but say And of you do this success to then these how you'll hit a the rebuilding let's there, paths is Borderlands, to you tier the you've recurrent maybe do Theft spending that studio of or let's something meaning laid the reposition model

example do resources Well, when takes you opportunity there is And took can a absolutely got extent franchise. can you Borderlands if do X like off certainly Borderlands recurrent and the And extend so, of you on X to pivot a the title actually successful, can that Borderlands because a that a that the the was Borderlands consumer X great off life is significant took off, go. you've unexpectedly, to spending, crazy. then

don't where remember Our I XX releases, up. ended our DLC but a basis. to wasn't plan which is XX it daily on original what DLC plan expanded we

always where micro obviously you've more robust you got that in transaction a And can model. time. game you So a can do invest over

way the the because of have But what you like a hit people is be nature can't That do is. would because reason it the the you is can't suicide game. you change

And going run value get of audience nature extracting that the of you with you to screwing not consumer, risk again, if purely motivation the the game, franchise. the the do. you something and up from that's change the of would know So economic we

Giaimo Alex from proceed Please is Jefferies. question. with question your next with Our

to digital back also circling gross if that's conservatism up, relates expected. improvement margins how that helpful? the we just call full Lainie, accelerated margin around and Curious, see earlier right color bit for to understand especially some be it year there the Thanks If with would would out. shift question than it any gross or guidance implying expenses guide. R&D we're now. the seeing on are specific something We looks being color a think Just but I would the lighter guys. is that like to margins in you the

Sure.

is basically margin flat gross it's from the slightly year. down, So last

having digital a So us, margin the out and year. seeing is little offset from but bit business releases that's by we being consumer the new for come it recurrent are spending consumer recurrent this because higher mix less a spending

it in seeing we're early why the that's it's So but flat year.

spending go toward up the should toward part latter lift for latter the consumer continues hopefully bit So little We the see stay year of that and us. of the we'll see we a how strong part recurrent year. to

like question-and-answer for session. turn comments. the end the reached now to management the I have call closing would to of We over

ones for for to health to know to feel today or and want best people. light again, extend for we call. just our to everyone to give for loved be health, is some an we loved consolation everyone entertainment wishes any thank want your challenging able is by time. this bringing We that Well, you the suffered. small to have losses who blessed your We our Once listening attending ones condolences your incredibly

able what are grateful we it. do, do of We to to proud be

to express for again, gratitude smile function with to that colleagues showing their up once a I to for The amazing doing able their work. And we're solely our such for is results extraordinary my want face, reason of work. these have on dedication,

So thank us and much you wishes. very best so for joining our

conference. today's concludes This

disconnect we may at time you thank your your You lines this for and participation.