01—Abstract
Summary
Summary of the 10-Q filed March 11, 2009. Cited figures are marked; the original filing is the authoritative source.
Take-Two Interactive Software, Inc. reported a net loss of $50.4 milliona for the three months ended January 31, 2009, a worsening from the $38.0 million loss in the same period last year.
Net revenue increased to $256.8 millionb from $240.4 million year-over-year, primarily driven by strong performance in the Publishing segment, notably from the Grand Theft Auto franchise and Midnight Club: Los Angeles. However, the Distribution segment experienced a revenue decline. The company's balance sheet shows a decrease in cash and cash equivalents to $217.8 million from $280.3 million at the end of the previous fiscal year, reflecting cash used in operations and investing activities.
Accounts receivable and inventory also saw significant decreases. Despite the increased net loss, the company believes it has sufficient liquidity to meet its obligations for the next 12 months, supported by cash on hand and its credit facility.
02—Key points
Key Highlights
- Net loss widened to $50.4 million from $38.0 million year-over-year.
- Net revenue increased by 6.8% to $256.8 million, driven by the Publishing segment.
- Publishing segment revenue grew 21.9% to $149.2 million, boosted by Grand Theft Auto IV and Midnight Club: Los Angeles.
- Distribution segment revenue decreased by 8.8% to $107.6 million, impacted by lower hardware and prior-generation software sales.
- Cash and cash equivalents decreased to $217.8 million from $280.3 million at the end of FY2008.
- Operating expenses increased by 19.7% to $106.6 million, mainly due to higher selling & marketing, G&A, and R&D costs.
- The company is facing multiple ongoing legal proceedings, including class action lawsuits and investigations related to past stock option practices.
03—Questions
Frequently Asked Questions
What was Take-Two's financial performance for the quarter ending January 31, 2009?
Take-Two reported a net loss of $50.4 million for the three months ended January 31, 2009, compared to a net loss of $38.0 million in the same period of the prior year. Net revenue increased to $256.8 million from $240.4 million.
What drove the increase in net revenue?
The increase in net revenue was primarily driven by the Publishing segment, which saw a 21.9% rise to $149.2 million. This growth was largely attributed to strong sales from the Grand Theft Auto franchise (following GTA IV's release) and Midnight Club: Los Angeles. The Distribution segment, however, experienced an 8.8% decline in revenue.
How has the company's cash position changed?
The company's cash and cash equivalents decreased to $217.8 million as of January 31, 2009, from $280.3 million at the end of the previous fiscal year. This decrease was primarily due to cash used in operating activities.
Are there any significant legal or risk factors mentioned in this filing?
Yes, the company is involved in several ongoing legal proceedings, including class-action lawsuits related to past financial reporting and stock option practices, as well as an action concerning alleged 'copycat violence' from video games. A key risk factor highlighted is the potential for a significant charge to earnings if goodwill becomes impaired, and the negative impact of increased sales of used video game products.
04—Continue