Take-Two Interactive Software (TTWO) 8 Aug 242025 Q1 Earnings call transcript

Greetings, and welcome to the Take-Two Interactive First Quarter Fiscal Year 2025 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce to you, Nicole Shevins, SVP of Investor Relations and Corporate Communications.

Thank you, Nicole.

You may begin.

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

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

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

these factors SEC, including We our a based operating statements. the on quarterly Actual risks vary are like section Form filings will Form of with most on XX-Q, forward-looking are are company's have XX-K on to be note results These discussing that the to Risk factors. described statements no and entitled all variety unless update in all important otherwise forward-looking today annual recent significantly including numbers report year-over-year. comparisons and obligation the may stated, the from we report Factors. I'd in GAAP summarized also these

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

any reconciliation financial most a press to of GAAP non-GAAP release contains also Our measure. comparable measure the

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to over And now I'll turn call Strauss. the

year today. solid joining thank you that to Thanks, to a start. Nicole. Good off is report for I'm us XXXX pleased and afternoon, fiscal

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including our teams pipeline, work to sequential bookings we and boundless tremendous like talented hard expect their fiscal our increases for XXXX I'd our to growth, XXXX. across net in labels achieve dedication mission. our release we groundbreaking and As passion, in thank to

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I'll Karl. now turn the call over to

our entertainment our the immersive and success. for for experiences that deliver to continuing thank Thanks, Strauss. teams strengthening are foundation like engaging long-term I'd to

of land Turning to journey the RPG started marketing World. who Zynga set releases On reception title the Westeros campaign Emmy House exciting the launched the players Google Golden U.S. a and the title Player of Legends, Play recent Harington from for July Apple featuring and to Store the a of our on been in actor, and through puzzle franchises. the has year. of return Game entering game lower the with the overall of announced free to storylines and current Thrones: U.S. in Kit Dragon marked The Immersive category offerings the magical XX App Globe-nominated top games on positive, Thrones in the new franchise, in also and Game characters, XX, popular invites title, HBO's which

again my days officially NBA, and an to Concepts to on experience early. Players X and and the preordered compete game for forge the of to have and Those up in standards will the fans will launch chance the dense offer excited XK in of interactive will career my city to on new, X and are be we new and modes. in play basketball in set with launches MyTEAM ability dynasty got status cement the era Visual a W. the that NBA September able once title in a more platforms to X added Gen The our their industry realism excellence sixth XKXX.

most NBA more to of passionate that XKXX access provide PC, Visual advanced stunning community will Concepts our Xk are up launch. to details graphics. about Gen thrilled the leading gameplay which have release will version X series to game and its the will our for share We

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and launched iOS are game partnership also China Android #X on a stores and through at our civilization the in that We launch. with mobile successfully pleased title hit Tencent

of there returns margin as to deliver strategy, to enable that we opportunities are closing, us our upon long-term believe growth a for shareholder many Take-Two. and period that In continue expansion, significant we will execute

I'll now turn the Lainie. to call over

results while with our exciting solid releases Thanks, Karl, efficiency. good by players maintaining focus updates, our and and quarter new game We on everyone. engaging achieved afternoon, first content

a have our great ability to deliver to period multiyear of continue confidence We growth. in

core Our healthy. franchises remain

enabling Our vision. hard opportunities us ambitious their for teams to millions unwavering enhance players on and our most for to model remain financial development like new profile. long-term focused growth to at of history, to our on support our and thank every day work captivate the in are we teams our pipeline and I'd business company's

Puzzles. the was our which was consumer Blast hyper bookings which mid-single of guidance period Turning Toon by quarter growth & casual billion $X.X delivered Recurrent to net accounted our net digits, $X.XX XX% We in was portfolio the billion. for in spending results. Mobile to flat addition of partially for driven billion, bookings. in of line and $X.XX our with first by increased of and Factory! offset and mobile Match Empires declines range

Grand and Theft Auto Online NBA were down. both XK

Early Hunters. we the Playmakers Rest XK NFL PC, launched Star TopSpin During quarter, Wicked XKXX, Access the on and for Wars: for

GAAP operating a management year-over-year $XXX increased rose than to revenue increased cost billion net million which lower million. by due revenue $XXX X% On was our X% to R&D declined to expenses and operating X% $X.XX and to better marketing of while XX% forecast basis, expenses costs.

with I'll full Turning begin year our to expectations. our fiscal guidance.

growth Redemption is largest & to performing bookings Puzzles, Toon outlook Blast, represents XXXX. billion, mobile and mentioned, Civilization hypercasual well. the VII Sid Words Friends. The series, are bookings Auto X% reiterating the net Strauss expected series, to XK, business be With contributors Empire Dead $X.XX our Match over billion And Grand portfolio, NBA of our to range Red Our we Theft $X.XX net as which Factory!, are fiscal Meier's

spending representing approximately expect to of X%, consumer growth XX% of continue bookings. We net recurrent

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declined for Auto has results Grand for Theft NBA expect Online. flat We XK and

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be million, of million to expect capital office and non-GAAP approximately now $XXX of build-outs. we game technology operating and adjusted flow primarily plan deploy unrestricted for outflow an to $XXX expenditures cash We

and billion billion billion expect We are to to $X.XX to operating range to last of from $X.X $X.XX range revenue $X.XX net expected to $X.XX The from revenue to compared billion expenses total from $X.XX GAAP range year. as billion $X.XX billion to billion. cost

of growth Gearbox for Match launches by expense due planned immersive a is addition On year-over-year. The management increase XX% program. to we partially operating mobile expect This an basis, cost reduction and from costs, in year. the of Factory! well marketing ongoing core offset as support approximately our higher as other largely savings and from personnel

single addition to of last and grow marketing operating expected year. expenses are over incremental low Gearbox, our the Excluding digits

project billion for Now to guidance billion bookings billion fiscal second moving net to last to range on our We compared $X.XX in to quarter. the quarter second $X.XX the from $X.XX year.

Our largest contributors Thrones: series, release of includes XK, and Puzzles, be and to hyper-casual to are Dragons!. Dead our Red the expected Blast, net Theft XKXX. Friends, mobile Legends Factory!, Match bookings series Auto quarter Game With for the Words slate & The Merge Grand NBA portfolio, the NBA Empires Redemption Toon

portfolio are and by We a and the Puzzles. project by low of Match from offset to recurrent our Blast addition & in assumes approximately X%, mobile Factory! partially double-digit increase driven in which consumer Empires spending declines Toon mobile growth which increase hypercasual by

and Online. Grand a to NBA We decline XK expect results Auto flat Theft for

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In industry-leading trajectory development of by multiyear talent, ability closing, growth, in our strong of deliver groundbreaking properties portfolio iconic and driven confident to intellectual diverse our we pipeline. owned our are a our

profitability will and believe and to value business, As strategic for our our advantages on our that long-term competitive capitalize enhance we shareholders. priorities, we deliver our grow pursue we our continue

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

I On the our ability To highest I'd like for unique engaging to Karl. colleagues management communities. and appreciation support. of continued and thank to entertainment results to your our player express consistently quality Lainie our shareholders, to Thanks, behalf reflect entire team, offerings our most our delivering our provide for want that

Operator? take now We'll questions. your

[Operator Instructions] with Creutz TD And the question of Doug from Cowen. comes first the line

released has just the sure largest well, Your exceptionally game I'm as peer done that college you've seen. football

college seems NBA thoughts Just nice opportunity another or curious unit-based basketball might feature mode adding game. in a XK, any the like caused that's a be a there item if about potentially whether it's just there. to It

for Thanks the question, Doug.

to note obviously [ colleges did with we we're might interested with history that listening it and with that. of in community -- of take XK. did did obviously, have now, if Nothing noticed And always have a football our So future. -- in the see announce do yes, colleges but obviously, necessarily speaking. not to we how the board, and it. And the across -- just something it's we success exciting there's college [ do we industry. take be able ] we notice just generally the We with ] to a to That's basketball

Sebastian And comes question Colin the next line the from of with Baird.

could curious with in the or are marketing testing I for to you so development would Gearbox? the a of game is if Or I of that are first new of Are year Any this parts just of to the something least Lainie, GTA, approaching guidance midst follow-up, color there scale, as you perhaps was generically OpEx stage? was clarification I be in at cycle production great. development? at to with more a point And think, the the a that to you the would next support core of the I sort still increase be at related there, year, interesting. titles? in what Any development sort guess, left of on complete, guess off, go outline

Thanks, Colin.

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increase the the it's of extent, to marketing, Gearbox and And driven personnel in occupancy in mostly and terms higher expenses. lesser the of a OpEx, acquisition by

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comes the with question of line Crum Drew next the from And Stifel.

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for the question, Thanks Drew.

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overall your modeling regarding your open you you PC maybe franchises? UGC on and Can how games? future are for across to And give console your approach updated view. different view both us on question First to

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next question Benchmark Hickey line the from The the Mike And of Company. with comes

quarters Strauss, Nicole. Karl, Lainie, guys. Great

of Just on Always about more a impact obviously, sort term. economic thinking debate lot curious darkening future to maybe Strauss, But just here on picture I your guess macroeconomic near opinion. of you're how your importantly, our a business.

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industry As is in businesses growth mode, digits, back you single know, low console our for mobile's software that up is digits. mid-single up

where within that results guidance 'XX. or there the well, tremendous our is we're year, fiscal to new tailwinds pipeline and on growth and as will we mobile business consensus. announcing titles, squarely with and expect which We've about are reiterated than consistent our a So right in continue we're track referenced guidance said very really really we performing which for and we're perform. Obviously, better 'XX think that all our great and console quarter these we we've are with today, excited

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And the Omar next Bank America. question from comes Dessouky of the line of with

strength XK the I how take ask you any wanted your in for license? simulation second and is rumors comment opportunity would a Strauss, to you on that developing games, what philosophy Whether sports the soccer is how the they game market? big about on what be acquiring FIFA might And long in your might regard.

a Yes, there's software lot there. Look, the business. we're in

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and on, list will I'm course. make in the goes due So we sure more announcements

question Griffin MoffettNathanson. with line of next the from The comes Clay

business. think have see hypercasual to And of to this there? the suspect in Strauss, think on your you talk opportunity what titles revenue, about I net like, of in of demand more sources in you But advertising the direct-to-consumer the what side? Curious with in-app core change would for that's advertising of year-over-year I and external can do the continued mobile in something really into investing of peak. the more advertising portfolio is push do just the maybe guess, kind prefer you bigger do just Or reorientation you

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And the UBS. line the from Schoell of next with comes question Chris

us operating ramp think these remind pointed initiatives recognize to going is the a your builds can to we you're you've 'XX. You can in period to are and I But more recent about cost released? the been of alongside margin amongst as has you Lainie, bookings levels and titles pipeline development in investment, margins new and implemented how 'XX ramp? are and see fair leverage bookings years. which multiyear the impacted a return through in thinking it efficiencies historic

at of more We're going have at to that look pipeline structure and working places hard bring and looking could in it we when We very we 'XX in efficient. cost terms really more organization and do and the be 'XX to been of fruition. our the reducing

at costs we've think our So couple couple corporate for and we cost-cutting can announced of been commercially looking as most over continue last that our streamline the ways our initiatives that years departments successful. our to a look looking label and improve. Also areas of at as titles doing that pipeline, at well looking between the we to will we have be

of and lot a annualization doing past we'll that in been we've So year, costs 'XX. this of those fiscal see an year

in margins, improve 'XX to future, So to improve and those our in 'XX continue and the margins look continue well. we our which expect will to that will as for opportunities

[ question Alter comes line final Jefferies. ] of with our from And the Ed

I was to this arbitrary the where did noticed right big the of those than Could compare with rather the kind few the quarter X last how it a talk end quarter updates was you end? year June update each weeks of other at just GTA earlier. about

and about us. for actually fantastic release So this for a the online result we're it year, summer was really excited detail

strong the expectations to comparing to certainly -- all giving terms in comparison different a have not In that's prepared very different. do. something different the us, for deliveries. direct terms directly -- of was our it between that and the have very we're and and releases. really and typically, of we even They one, this They're don't one exceed had them they compare we quarter. us the last for expectations helped But This

Ladies Q&A session. time, at have and gentlemen, the reached this the end we of

would I over Strauss pass any call back comments. Now the for to to like closing

leadership in want the just and we're and the have these executive so always. to team talented best we that business, thank phenomenally do, believe delivered our grateful well. results, creative we We teams team as I most that we as great talented a have

the ahead. all to our X,XXX and We're [ today. what world deserve, really aim colleagues give That's joining and in delivering for year every we Thank that's consumers. us who entertainment have what years the best ] work of of the day, about the they We rest optimistic hard them. around service you really to the

does And ladies gentlemen, and that today's teleconference. conclude

your your at for disconnect Thank may You you lines time. this participation.