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TAKE TWO INTERACTIVE SOFTWARE INC Quarterly Report for Q2 Ended Jul 31, 2002

Filing Date
Filed September 16, 2002
Period End
July 31, 2002
Security
TTWO
In the record · 2016–202610-K1110-Q338-K116

TTWO filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 116 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Mar ’17Mar ’17
  2. FY2019 annual report10-K · May ’19May ’19
  3. Deal closed8-K · May ’22May ’22
  4. Leadership change8-K · Sep ’25Sep ’25

01—Abstract

Summary

Summary of the 10-Q filed September 16, 2002. Cited figures are marked; the original filing is the authoritative source.

Take-Two Interactive Software, Inc. reported a significant turnaround in financial performance for the nine months ended July 31, 2002, compared to the same period in the prior year.

The company achieved a net income of $49.2 milliona, a substantial improvement from a net loss of $3.9 million in the prior year. This positive shift was driven by a strong increase in net sales, primarily from the publishing segment, which rose by 139.2% to $411.9 million. The success of titles like "Grand Theft Auto 3" and "Max Payne" on various platforms, especially the PlayStation 2, was a key driver of this growth.

The company also demonstrated improved operational efficiency, with total cost of sales as a percentage of net sales decreasing from 64.6%b to 63.0%. While selling and marketing expenses and general and administrative expenses increased in absolute terms, they as a percentage of net sales either decreased or remained stable, indicating better leverage.

The company's cash position significantly improved, with cash and cash equivalents increasing to $73.9 millionc from $6.1 million, largely due to robust cash flow from operations. Despite facing ongoing legal proceedings and regulatory investigations, Take-Two appears to be on a path to profitability, buoyed by its strong product portfolio.

02—Key points

Key Highlights

  1. Net income of $49.2 million for the nine months ended July 31, 2002, a significant improvement from a net loss of $3.9 million in the prior year.
  2. Net sales increased by 76.0% to $575.7 million for the nine months ended July 31, 2002, driven by strong performance in the publishing segment.
  3. Publishing revenues surged by 139.2% to $411.9 million for the nine months ended July 31, 2002, largely due to the success of 'Grand Theft Auto 3' and 'Max Payne'.
  4. Total cost of sales as a percentage of net sales improved, decreasing from 64.6% to 63.0% for the nine months ended July 31, 2002.
  5. Cash and cash equivalents significantly increased from $6.1 million at October 31, 2001, to $73.9 million at July 31, 2002.
  6. The company settled a consolidated class action lawsuit for $7.5 million, with most of the cost offset by insurance proceeds.
  7. Despite facing an SEC investigation, the company reported compliance with covenants on its credit facilities and had no outstanding borrowings as of July 31, 2002.

03—Questions

Frequently Asked Questions

  1. What is the company's overall financial performance for the nine months ended July 31, 2002?

    Take-Two Interactive Software, Inc. reported a significant improvement in its financial performance. For the nine months ended July 31, 2002, the company achieved a net income of $49.2 million, a substantial turnaround from a net loss of $3.9 million in the same period of the previous year. This was driven by a 76.0% increase in net sales to $575.7 million, primarily fueled by strong publishing revenues, and an improvement in the cost of sales as a percentage of net sales.

  2. What were the main drivers of the revenue growth?

    The primary driver of revenue growth was the publishing segment, which saw a 139.2% increase to $411.9 million for the nine months ended July 31, 2002. Key titles such as 'Grand Theft Auto 3' (especially on PlayStation 2 and PC) and 'Max Payne' (on PlayStation 2 and Xbox) were major contributors. Console games, in particular, represented a larger portion of publishing revenues compared to the previous year.

  3. How has the company's cash position evolved?

    The company's liquidity has substantially improved. Cash and cash equivalents grew from $6.1 million at October 31, 2001, to $73.9 million at July 31, 2002. This increase was primarily due to $118.8 million in cash provided by operating activities, more than offsetting cash used in investing and financing activities.

  4. What are the significant legal and regulatory matters facing the company?

    Take-Two is involved in several significant legal and regulatory matters. It has settled a consolidated class action lawsuit for $7.5 million, with a substantial portion covered by insurance. Additionally, the Securities and Exchange Commission (SEC) has issued a formal order of investigation concerning accounting matters, financial reporting, and internal controls. The company is also settling ordinary course litigation with Red Storm Entertainment Inc. (a subsidiary of Ubi Soft Entertainment).

04—Continue

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