10-KPeriod: FY2021

TAKE TWO INTERACTIVE SOFTWARE INC Annual Report, Year Ended Mar 31, 2021

Filed May 19, 2021For Securities:TTWO

Summary

Take-Two Interactive Software, Inc. (TTWO) demonstrated robust financial performance in the fiscal year ending March 31, 2021, with net revenue increasing by 9.2% to $3.37 billion, driven by strong performance in its key franchises like NBA 2K and Grand Theft Auto. The company continues to benefit from the shift towards digital distribution, with digital online channels accounting for 86.6% of net revenue. Recurrent consumer spending, encompassing virtual currency and in-game purchases, also saw significant growth, comprising 61.5% of net revenue, indicating a successful transition to a more stable revenue model. The company reported a substantial increase in net income to $588.9 million, reflecting improved operational efficiency and revenue growth. Looking ahead, Take-Two is investing in new content for its established franchises and expanding its offerings across various platforms. The acquisition of Playdots further strengthens its mobile gaming segment. While facing industry competition and the ongoing impact of economic conditions, the company appears well-positioned to capitalize on the continued growth in interactive entertainment.

Financial Highlights

56 data points
Beta

Revenue

$3.37B

54.5% Gross Margin

Net Income

$588.90M

17.5% Net Margin

EPS (Diluted)

$5.09

Total Assets

$6.03B

Cash & Equivalents

$1.42B

Free Cash Flow

$843.40M

Financial Statements
Beta
Revenue$3.37B
Cost of Revenue$1.54B
Gross Profit$1.84B
Operating Expenses$1.21B
Operating Income$629.40M
Net Income$588.90M
EPS (Basic)$5.14
EPS (Diluted)$5.09
Shares Outstanding (Basic)114.60M
Shares Outstanding (Diluted)115.70M

Key Highlights

  • 1Net revenue increased by 9.2% to $3.37 billion for the fiscal year ended March 31, 2021.
  • 2Net income grew to $588.9 million, up from $404.5 million in the prior year.
  • 3Digital online channels accounted for 86.6% of net revenue, highlighting a strong shift towards digital distribution.
  • 4Recurrent consumer spending (virtual currency, add-on content, in-game purchases) represented 61.5% of net revenue, indicating successful monetization of live services.
  • 5The company's top franchises, including NBA 2K, Grand Theft Auto, and Red Dead Redemption, remain key drivers of revenue.
  • 6Acquisition of Playdots strengthens the company's mobile gaming portfolio.
  • 7Significant investment in software development continues, with $490.9 million in capitalized costs at March 31, 2021.

Frequently Asked Questions

Take-Two's revenue growth was primarily driven by strong performance from its key franchises, notably the NBA 2K series, Grand Theft Auto V and Online, Red Dead Redemption 2 and Online, Borderlands 3, and PGA TOUR 2K21. The company also saw increased revenue from its mobile titles like Dragon City and its recent acquisition, Two Dots.

The shift to digital distribution has been highly beneficial for Take-Two. Digital online channels accounted for a significant 86.6% of net revenue in fiscal year 2021. This trend aligns with the company's strategy to drive recurrent consumer spending through virtual currency, add-on content, and in-game purchases, which now form the largest portion of their revenue at 61.5%.

Take-Two's strategy focuses on supporting its world-class creative teams, publishing high-quality titles, leveraging emerging technologies and distribution channels, and expanding its international business. They plan to continue releasing new content for existing franchises and are investing in new intellectual property. The recent acquisition of Playdots also signals a commitment to growing its mobile gaming segment.

Take-Two Interactive Software, Inc. has never declared or paid cash dividends on its common stock. The company currently plans to retain all future earnings to finance business growth and does not anticipate paying cash dividends in the foreseeable future.