- Q1 Net Bookings Surpass Expectations Net bookings reached $1.42 billion, driven by Mobile titles, NBA 2K, and Grand Theft Auto series outperformance.
- Mobile Business Growth Accelerates Peak's Toon Blast grew 22% YoY, Rollic's Color Block Jam became its highest-grossing title, and Match Factory! hit record net bookings.
- NBA 2K25 and GTA Series Outperform NBA 2K25 sold 11.5M units; GTA V surpassed 215M lifetime sales, contributing to engagement growth.
- Revised FY26 Outlook Net bookings guidance raised to $6.05B–$6.15B, with operating expenses down 3% to $923M and capital expenditures of $140M.
- Strong 2027 Outlook Pipeline includes Mafia: The Old Country, NBA 2K26, and Borderlands 4, targeting record net bookings and higher profitability in FY27.
Mobile Segment Shines
The Mobile business vastly exceeded expectations, with Peak's Toon Blast growing 22% year-over-year and Match Factory! achieving record net bookings. Rollic's Color Block Jam maintained its positive momentum, becoming the studio's highest-grossing title. This strong performance is a testament to the company's focus on mobile direct-to-consumer opportunities.
Core Franchises Drive Growth
NBA 2K25 delivered strong results, with sales of over 11.5 million units and engagement growing significantly year-over-year. The Grand Theft Auto series also exceeded expectations, with Grand Theft Auto V selling over 215 million units worldwide. As Lainie Goldstein, CFO, mentioned, "Our fiscal 1Q results were fantastic, driven by momentum in our big titles."
Outlook and Valuation
The company is optimistic about the year ahead, with a strong pipeline of releases, including Mafia: The Old Country, NBA 2K26, and Borderlands 4. Take-Two expects to achieve record levels of net bookings in FY27, establishing a higher baseline for the business and driving enhanced profitability. With a current P/E Ratio of 7.12 and P/S Ratio of 7.12, the stock appears reasonably valued, considering its strong growth prospects.
Management's Confidence
Strauss H. Zelnick, CEO, expressed confidence in the company's outlook, driven by its strong pipeline, diversified business, and focus on mobile direct-to-consumer opportunities. He emphasized the importance of delivering value to consumers, stating, "We believe that the industry's pricing environment is variable, and our approach is to deliver more value than what we charge."
Valuation Metrics
Take-Two Interactive Software's current valuation metrics include a P/E Ratio of 7.12, P/B Ratio of 17.98, P/S Ratio of 7.12, and EV/EBITDA of -12.29. The company's ROIC (%) stands at -64.64, and ROE (%) at -91.27, indicating room for improvement in profitability. The Net Debt / EBITDA ratio is -0.76, indicating a relatively conservative balance sheet.