Take-Two Interactive posted today its quarterly financial results, giving a detailed look at how the company did in the third quarter of fiscal year 2016, ended on December 31st, 2015. The results are described as stronger than expected.
- GAAP net revenue: $414.2 million.
- GAAP net loss: $42.4 million.
- Non-GAAP net revenue: $486.8 million.
- Non-GAAP net income: $99.7 million
We also get a few highlights for the company’s labels 2K Games and Rockstar, including the fact that Grand Theft Auto V has now sold over 60 million units:
- Entered into a new multi-year partnership agreement with WWE granting 2K the exclusive worldwide rights to develop and publish WWE video game properties across all major platforms and distribution channels.
- Launched WWE 2K16 on Xbox One, Xbox 360, PlayStation 4 and PlayStation 3. Developed collaboratively by Yukes and Visual Concepts, the title received significantly improved review scores and has generated growth in sales versus last-year’s release. WWE 2K16 is being supported with downloadable add-on content, including a Season Pass.
- Released Sid Meier’s Civilization: Beyond Earth™ – Rising Tide for PC. Developed by Firaxis Games, Rising Tide is a massive expansion pack for the 2014 turn-based strategy title, Civilization: Beyond Earth.
- Released The Borderlands Triple Pack for Xbox 360 and PlayStation 3, which includesBorderlands, Borderlands 2 and Borderlands: The Pre-Sequel, plus all of the games’ previously-released downloadable add-on content.
- Released Evolve Ultimate Edition for Xbox One and PlayStation 4, which includes the 2014 Electronic Entertainment Expo and Gamescom “Game of Show” award-winning title along with its Monster Expansion Pack, Hunting Season 1 and Hunting Season 2 downloadable add-on content packs.
- Expanded the Company’s online offerings in Asia with the commercial launch in Korea ofCivilization Online, a free-to-play, massively multiplayer online game developed in partnership with renowned South Korean studio XLGAMES. 2K also plans to bring Civilization Online toTaiwan, Hong Kong, Macau and China through publishing partnerships with Game First andQihoo 360.
- Expanded the Company’s offerings for tablets and smartphones with the releases of NBA 2K16,My NBA 2K16 and NHL SuperCard for tablets and smartphones.
- Announced that Battleborn™, which is currently in development for PlayStation 4, Xbox One and PC by the creators of Borderlands at Gearbox Software, is planned for release on May 3, 2016.
- Announced that XCOM® 2, which is the sequel to the Game of the Year award-winning strategy title XCOM: Enemy Unknown and is currently in development at Firaxis Games, is planned for release on February 5, 2016 for PC. XCOM 2 has received outstanding early review scores, withGame Informer Magazine, GameSpot and IGN each scoring the title in the 9-out-of-10 range. According to IGN, “XCOM 2 is an amazing game,” while Game Informer Magazine called it “one of the deepest and most rewarding strategy games on the market.”
- Announced that Mafia® III, the next installment in 2K’s successful organized crime series, is currently in development for Xbox One, PlayStation 4 and PC at Hangar 13, 2K’s new development studio. Mafia III is planned for release during calendar 2016 (fiscal year 2017).
- Grand Theft Auto V has now sold-in over 60 million units worldwide across all platforms.
- Released new free content updates for Grand Theft Auto Online, including:
- A January 28, 2016 update featuring the new ‘Drop Zone’ Adversary Mode, two new high-end vehicles and additional improvements to Grand Theft Auto Online.
- Festive Surprise 2015, featuring holiday-themed attire, Christmas trees, snowball fights, and new holiday-themed adversary modes;
- Executives and Other Criminals, which offers players the chance to run their own criminal organizations and face off against rival operations across Freemode. The update also includes new customizable real estate, super yachts, armored vehicles, weapons and much more;
- Lowriders, which adds new and upgraded vehicles including specific lowrider customization options such as hydraulics, new Adversary Modes, new Lowrider-themed Contact Missions, an array of new clothing, tattoo and accessory options, as well as upgrades to both Freemode and the Rockstar Editor’s Director Mode; and
- Halloween Surprise, featuring a new Halloween-themed adversary mode plus special vehicles, masks and more.
- Released Grand Theft Auto: Liberty City Stories for select iOS devices. Originally designed with mobile gameplay in mind, Grand Theft Auto: Liberty City Stories returns with significant enhancements for iOS and also will be coming soon to Android.
The press release included a deeper analysis of the results:
“For fiscal third quarter 2016, Non-GAAP net revenue was $486.8 million, as compared to $954.0 million for the year-ago period, which had benefited from the launches of Grand Theft Auto V® for PlayStation®4 and Xbox One, Borderlands®: The Pre-Sequel, and Sid Meier’s Civilization®: Beyond Earth. Non-GAAP net income was $99.7 million, or $0.89 per diluted share, as compared to $211.6 million, or $1.87 per diluted share, for the year-ago period. Non-GAAP net income for fiscal third quarter 2016 reflects approximately $32 million in tax benefits related to video game development costs.
The largest contributors to Non-GAAP net revenue in fiscal third quarter 2016 were Grand Theft Auto V and Grand Theft Auto Online, NBA® 2K16, WWE® 2K16, and the Borderlands series. Non-GAAP net revenue from digitally-delivered content was $213.6 million and accounted for 44% of total Non-GAAP net revenue. The largest contributors to Non-GAAP net revenue from digitally-delivered content were the Grand Theft Auto, NBA 2K, WWE 2K, and Sid Meier’s Civilization series. Revenue from recurrent consumer spending (virtual currency, downloadable add-on content and online games) grew 45% year-over-year and accounted for 54% of Non-GAAP net revenue from digitally-delivered content, or 24% of total Non-GAAP net revenue. Catalog sales accounted for $235.3 million of Non-GAAP net revenue led by the Grand Theft Auto and Borderlands series.”
CEO Strauss Zelnick accompanied the press release with a comment:
“During the holiday season, Take-Two enjoyed immense consumer demand for its recent releases and catalog, enabling the Company to deliver another quarter of strong revenue, Non-GAAP earnings and cash flow. These outstanding results were driven by robust sales of Grand Theft Auto V, NBA 2K16 and WWE 2K16, along with our highest-ever revenue from recurrent consumer spending.
“As a result of our third quarter outperformance and solid forecast for the balance of the year, we are once again raising our financial outlook for fiscal 2016, which is poised to be another year of meaningful profits for Take-Two. Looking ahead, we have an extensive development pipeline that positions our Company for revenue growth and margin expansion over the long-term. We are excited about this Friday’s release of XCOM 2, which has received stellar early review scores, and anticipation already is building for the fiscal 2017 launches of Battleborn and Mafia III.”
The full fiscal year forecast, for the period between April 1st, 2015 and March 31st, 2016, was increased to reflect the better than expected results for this third quarter, to a non-GAAP net revenue of $1.48 billion to $1.53 billion.
Last, but not least, is the list of titles releasing in the next few months: