TAKE TWO INTERACTIVE SOFTWARE INC Quarterly Report for Q1 Ended Jun 30, 2015

Summary

Take-Two Interactive Software, Inc. reported a significant increase in net revenue to $275.3 million for the three months ended June 30, 2015, up from $125.4 million in the prior year period. This growth was primarily driven by strong sales of the 'Grand Theft Auto' franchise, particularly 'Grand Theft Auto V' which saw its PC release in April 2015 and continued revenue from its online component. Despite the revenue surge, the company experienced a widening net loss of $67.0 million compared to $35.4 million in the prior year. This increase in loss is attributed to a substantial rise in the cost of goods sold, largely due to higher internal royalties, alongside increased operating expenses in selling, marketing, general administrative, and research and development functions. The company maintains a strong liquidity position with $815.8 million in cash and cash equivalents and short-term investments as of June 30, 2015.

Key Highlights

• 1Net revenue increased significantly to $275.3 million, driven by 'Grand Theft Auto V' PC release and ongoing 'Grand Theft Auto Online' revenue.
• 2Cost of goods sold rose substantially, impacting gross profit margins, primarily due to increased internal royalties.
• 3Operating expenses saw a notable increase across selling & marketing, general & administrative, and R&D, impacting profitability.
• 4Net loss widened to $67.0 million from $35.4 million in the prior year's comparable quarter.
• 5The company holds a substantial cash and short-term investment balance of $1.19 billion ($815.8 million cash + $375.0 million short-term investments) as of June 30, 2015.
• 6Console platform revenue dominated, representing 80.8% of total net revenue, a significant increase from the prior year.
• 7Digital online distribution channels accounted for 55.9% of net revenue, though this proportion decreased year-over-year.

Frequently Asked Questions