Summary
Take-Two Interactive Software, Inc. reported a net loss of $50.4 million 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 million 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.
Key Highlights
- 1Net loss widened to $50.4 million from $38.0 million year-over-year.
- 2Net revenue increased by 6.8% to $256.8 million, driven by the Publishing segment.
- 3Publishing segment revenue grew 21.9% to $149.2 million, boosted by Grand Theft Auto IV and Midnight Club: Los Angeles.
- 4Distribution segment revenue decreased by 8.8% to $107.6 million, impacted by lower hardware and prior-generation software sales.
- 5Cash and cash equivalents decreased to $217.8 million from $280.3 million at the end of FY2008.
- 6Operating expenses increased by 19.7% to $106.6 million, mainly due to higher selling & marketing, G&A, and R&D costs.
- 7The company is facing multiple ongoing legal proceedings, including class action lawsuits and investigations related to past stock option practices.