Take-Two News Release

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Take-Two Interactive Software, Inc. Reports Strong Results for Fiscal Third Quarter 2022

GAAP net revenue increased 5% to $903.3 million

GAAP net income per diluted share was $1.24

GAAP net cash provided by operating activities for the nine-months ended December 31, 2021 was $19.2 million

Adjusted Unrestricted Operating Cash Flow (Non-GAAP) for the nine-months ended December 31, 2021 was $278.9 million

Net Bookings grew 6% to $866.1 million

Company again raises its Net Bookings outlook for fiscal year 2022 to $3.37 billion to $3.42 billion

NEW YORK--(BUSINESS WIRE)--Feb. 7, 2022-- Take-Two Interactive Software, Inc. (NASDAQ:TTWO) today reported strong results for the third quarter of its fiscal year 2022, ended December 31, 2021. In addition, the Company raised its outlook for the fiscal year 2022, ending March 31, 2022, and provided its initial outlook for the fourth quarter of its fiscal year 2022, ending March 31, 2022. For further information, please see the third quarter fiscal 2022 results slide deck posted to the Company’s investor relations website at http://ir.take2games.com.

Third Quarter Fiscal 2022 Financial Highlights

GAAP net revenue increased 5% to $903.3 million, as compared to $860.9 million in last year’s fiscal third quarter. Recurrent consumer spending (which is generated from ongoing consumer engagement and includes virtual currency, add-on content and in-game purchases) was relatively flat and accounted for 61% of total GAAP net revenue. Digitally-delivered GAAP net revenue increased 7% to $795.7 million, as compared to $743.1 million in last year’s fiscal third quarter, and accounted for 88% of total GAAP net revenue. The largest contributors to GAAP net revenue were NBA® 2K22 and NBA 2K21; Grand Theft Auto® Online and Grand Theft Auto V; Grand Theft Auto: The Trilogy - The Definitive Edition; Red Dead Redemption® 2 and Red Dead Online; Grand Theft Auto: San Andreas; Borderlands® 3; and Two Dots®.

GAAP net income was $144.5 million, or $1.24 per diluted share, as compared to $182.2 million, or $1.57 per diluted share, for the comparable period last year.

During the nine month-period ended December 31, 2021, GAAP net cash provided by operating activities was $19.2 million, as compared to $787.7 million in the same period last year. During the nine month-period ended December 31, 2021, Adjusted Unrestricted Operating Cash Flow (Non-GAAP), which is defined as GAAP net cash from operating activities, adjusted for changes in restricted cash, was $278.9 million, as compared to $854.3 million in the same period last year (please see the section below titled “Non-GAAP Financial Measure” for additional information). As of December 31, 2021, the Company had cash and short-term investments of $2.5 billion.

The following data, together with a management reporting tax rate of 16%, are used internally by the Company’s management and Board of Directors to adjust the Company’s GAAP financial results in order to facilitate comparison of its operating performance between periods and to better understand its core business and future outlook:

 

 

Three Months Ended December 31, 2021

 

 

 

 

Financial Data

 

 

Statement

of

Operations

 

Change in

deferred net

revenue and

related cost of

goods sold

 

Stock-based

compensation

 

Impact of

business

reorganization

 

Amortization

and

impairment

of acquired

intangibles

 

Business

acquisition

 

Gain on

long-term

investments,

net

Net revenue

 

$903,252

 

(37,129)

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

350,379

 

5,060

 

(9,445)

 

 

 

(12,485)

 

 

 

 

Gross profit

 

552,873

 

(42,189)

 

9,445

 

 

 

12,485

 

 

 

 

Operating expenses

 

398,767

 

 

 

(36,899)

 

(123)

 

(2,745)

 

(13,976)

 

 

Income from operations

 

154,106

 

(42,189)

 

46,344

 

123

 

15,230

 

13,976

 

 

Interest and other, net

 

(5,629)

 

1,039

 

 

 

 

 

 

 

 

 

 

Gain on long-term investments, net

 

3,662

 

 

 

 

 

 

 

 

 

 

 

(3,662)

Income before income taxes

 

152,139

 

(41,150)

 

46,344

 

123

 

15,230

 

13,976

 

(3,662)

In order to calculate net income per diluted share for management reporting purposes, the Company uses its fully diluted share count of 116.7 million.

Operational Metric – Net Bookings

Net Bookings is defined as the net amount of products and services sold digitally or sold-in physically during the period, and includes licensing fees, merchandise, in-game advertising, strategy guides and publisher incentives.

During fiscal third quarter 2022, total Net Bookings grew 6% to $866.1 million, as compared to $814.3 million during last year’s fiscal third quarter. Net Bookings from recurrent consumer spending grew 2% and accounted for 57% of total Net Bookings. Digitally-delivered Net Bookings were up 12% to $762.3 million, as compared to $679.0 million in last year’s fiscal third quarter, and accounted for 88% of total Net Bookings. The largest contributors to Net Bookings were NBA 2K22; Grand Theft Auto Online and Grand Theft Auto V; Grand Theft Auto: The Trilogy - The Definitive Edition; Red Dead Redemption 2 and Red Dead Online; Top Eleven®; Grand Theft Auto: San Andreas; and Borderlands 3.

Catalog accounted for $581.3 million of Net Bookings led by Grand Theft Auto, Red Dead Redemption, Borderlands, Top Eleven, NBA 2K, the WWE® series, and Two Dots.

Management Comments

“Our third quarter performance was outstanding, highlighted by Net Bookings of $866 million, which exceeded our expectations and increased 6% over last year,” said Strauss Zelnick, Chairman and CEO of Take-Two. “Fiscal 2022 is shaping up to be another strong year for Take-Two, and we are once again raising our Net Bookings guidance for the year to $3.37 billion to $3.42 billion.

“We remain highly optimistic about the future of the interactive entertainment industry and our multi-year growth trajectory. From investing in talent to acquiring some of the industry's leading creative studios and announcing our transformational agreement to combine with Zynga, we are taking exciting steps to diversify our business, gain market share and enhance our positioning as one of the world's top three pure-play publishers of interactive entertainment. Together with our incredible pipeline of new intellectual properties and eagerly anticipated sequels, we are confident that we are positioning our business for long-term success and shareholder value creation.”

COVID-19 Update

At Take-Two, our number one priority has remained the health and safety of our employees and their families. We are taking a prudent approach relating to our return to office cadence and planning. Some of our offices are open, and we plan for the majority of our offices to reopen in the coming weeks. Given the evolving dynamics of the COVID-19 pandemic, we are strictly following protocols from local governments and health officials to ensure that we are adhering to their safety standards.

Due to the shelter-in-place orders that began in calendar year 2020, we experienced heightened levels of engagement and Net Bookings growth during our fiscal 2021 period. As the return to normalcy continues to unfold, the impact to our business, operations and financial results will depend on numerous evolving factors that we are not able to predict. The key risks to our business are set forth under the heading “Cautionary Note Regarding Forward-Looking Statements” in this release and in Take-Two’s Annual Report on Form 10-K for the fiscal year ended March 31, 2021.

Business and Product Highlights

Since October 1, 2021:

Take-Two:

  • On January 9th, entered into a definitive agreement, under which Take-Two will acquire all of the outstanding shares of Zynga in a cash and stock transaction valued at $9.861 per Zynga share, based on the market close as of January 7, 2022, with a total enterprise value of approximately $12.7 billion. Under the terms and subject to the conditions of the agreement, Zynga stockholders will receive $3.50 in cash and $6.361 in shares of Take-Two common stock for each share of Zynga common stock outstanding at the closing of the transaction. The transaction, which is expected to be completed during the first quarter of Take-Two’s Fiscal Year 2023, ending June 30, 2022, is subject to the approval of both Take-Two and Zynga stockholders and the satisfaction of customary closing conditions, including applicable regulatory approvals.

Rockstar Games:

  • On November 11th, Rockstar Games launched digitally Grand Theft Auto: The Trilogy – The Definitive Edition featuring across-the-board upgrades for all three games, including graphical improvements and modern controls for all three titles, while still maintaining the classic and distinct aesthetic of the original games. Grand Theft Auto: The Trilogy – The Definitive Edition launched physically for consoles on December 17th and will release for iOS and Android devices in the first half of calendar 2022.
  • Released new free content updates for Grand Theft Auto Online:
    • Rockstar Games continued to provide an array of free content for their vast and growing online communities. To celebrate Halloween, Grand Theft Auto Online added a series of random events to shock and surprise players, including driverless phantom killer cars, superhuman slashers, UFOs that bend the laws of physics, and more, including bonuses on Alien Survival modes, and a new Arcade game.
    • On December 15th, launched The Contract, an all-new Grand Theft Auto Online story as players, whether solo or in a group, team up with returning Grand Theft Auto V protagonist Franklin Clinton and track down missing new music from Grammy-Award winning artist, legendary producer and this year's Super Bowl half-time show headliner, Dr. Dre. The update also features new co-op story missions with Franklin and sidekick Lamar Davis as playable characters; a new social space - Record A Studios - where players can hang out with Dr. Dre and special guests; a new radio station hosted by global pop stars ROSALÍA and Arca called Motomami Los Santos, named after ROSALÍA’s forthcoming album; new updates to two existing radio stations from L.A. DJ royalty, DJ Pooh and Big Boy; six exclusive new tracks by Dr. Dre which officially released to streaming services this past Friday; and new purchasable properties, vehicles, and more.
  • Throughout the quarter, Red Dead Online received a series of updates, including the fourth installment of The Quick Draw Club and holiday-themed content including All Hallows' Call to Arms, The Halloween Pass 2, and the Holiday Call to Arms.
  • On March 15th, Rockstar Games will launch Grand Theft Auto V for PlayStation 5 and Xbox Series X|S, bringing the blockbuster entertainment experience to an unprecedented third console generation. This new release features new graphics modes with up to 4K resolution, up to 60 frames per second, texture and draw distance upgrades, HDR options and ray-tracing, as well as faster loading times, immersive 3D audio, platform-specific features and much more. Also coming in March is the standalone version of Grand Theft Auto Online, which will be free on PlayStation 5 for the first three months, enabling new players to join the thriving community on the latest hardware for new-generation consoles.

2K:

  • On November 9th, acquired elite3d, one of the world’s leading creative studios dedicated to innovative 2D and 3D artwork for the video game industry. Based in Valencia, Spain, the newly acquired team will rebrand to form a second office for 2K's wholly owned developer 31st Union and will also develop a new 2K Publishing location, including a focus on its Global Services division. 2K also acquired TURIA GAMES, S.L. in Valencia, a development studio co-owned by the founders of elite3d. Financial terms and employment numbers related to the acquisition were not disclosed.
  • Launched Seasons 2, 3 and 4 for NBA 2K22, with each Season featuring new music, new content, and seasonal updates across MyCAREER, MyTEAM, and The W modes.
  • On October 19th, launched the NBA 2K22 Arcade Edition on Apple Arcade. The game offers the all-new Association mode, where players can be the GM or Head Coach of their favorite NBA Franchises and build their own NBA dream teams, as well as other popular modes including MyCOURT, Online Multiplayer, and MyCAREER.
  • In anticipation of its early March release, 2K announced that Rey Mysterio® will star on the cover of WWE 2K22 in celebration of his 20th anniversary as a WWE Superstar. WWE 2K22 offers exciting new features and innovation to establish the title as the most impressive WWE 2K experience to date. Updates include a redesigned gameplay engine, new controls, stunning graphics, immersive presentation, a new WWE 2K Showcase, new fan-requested game modes including MyGM and MyFACTION, as well as MyRISE, Universe Mode, and the Creation Suite.
  • On November 17th, 2K launched WWE SuperCard Season 8, offering the new Survivor game mode, three new card tiers, a slew of new WWE Superstars, and multiple gameplay upgrades.
  • On October 14th, 2K and HB Studios launched the PGA TOUR 2K21 Baller Edition, which includes the base game, all previously released DLC courses and game modes, an assortment of the hottest gear from Clubhouse Pass Season One, holiday gear, novelty putters, and the Golden Touch Pack featuring a gold putter and driver. The Baller Edition also features the 2K/adidas CODECHAOS MyPLAYER Pack featuring adidas CODECHAOS BOA® golf shoes and custom 2K/adidas gear, including a sport performance polo, Ultimate365 pants, and tour hat, designed by adidas Golf exclusively for PGA TOUR 2K21.
  • On November 12th, 2K and Gearbox released the Borderlands 3 Ultimate Edition in physical disc form for PlayStation 5 and Xbox Series X. The offering is optimized to take full advantage of the new-gen hardware's processing power, and includes the award-winning base game plus all six content add-ons and the full collection of bonus cosmetic packs.
  • On November 18th, 2K and Gearbox released Vault Card 3: Bunker Masters for Borderlands 3, the final of three Vault Cards included in the Director's Cut add-on. The release included new fantasy-themed cosmetic items and powerful Legendary loot, driving further excitement for the similarly fantasy-fueled Tiny Tina’s Wonderlands coming March 25, 2022.
  • On November 9th, 2K and Gearbox Software launched Tiny Tina’s Assault on Dragon Keep™: A Wonderlands One-Shot Adventure as a standalone purchase. This release laid positive groundwork for the upcoming launch of Tiny Tina’s Wonderlands.
  • In December 2021, members of the all-star celebrity cast of Tiny Tina’s Wonderlands appeared on stage at The Game Awards to introduce the game’s trailer. Additionally, 2K and Gearbox Software provided players with a slew of new gameplay information, including the reveal of new classes, fantastical new environments, fresh details on guns and damage types, and much more.

Private Division:

  • On November 15th, acquired Roll7, a London based BAFTA award-winning video game developer best known for the OlliOlli Series. The studio is preparing for the release of OlliOlli World and has additional unannounced projects in development. Private Division will support these future endeavors and empower Roll7 to continue creating their signature “flow-state gaming” experiences to achieve commercial and critical success.
  • On February 8th, Roll7 and Private Division will launch OlliOlli World, the skateboarding action-platformer digitally for PlayStation 4, PlayStation 5, Xbox One, Xbox Series X|S, PC via Steam and Nintendo Switch. OlliOlli World marks a bold new direction for the OlliOlli franchise and has received much critical praise for the unique art style and tight gameplay mechanics. Reviews for the game have been positive, with multiple sites denoting the title as a “Recommended”2 or “Essential”3 purchase, stellar review scores from many major outlets4, and the game currently earning an 85 on OpenCritic5 and 84 on Metacritic5 respectively. The game comes with diverse and rich customization options, allowing players to be whoever they want to be; body type, skin tone, and hair are all customizable.

T2 Mobile Games:

  • On October 11th, Nordeus released Top Eleven 2022, the latest installment of their mobile title that is the world’s most successful soccer management game of all time. Top Eleven 2022 delivers significant updates to the gameplay and soccer management experience.

1 Within a 7.5% symmetrical collar based on a Take-Two share price of $169.19 as the midpoint.

2 Game earned Polygon Recommends.

3 Eurogamer’s “Essential” award.

4 IGN 9/10, GameSpot 9/10, Digital Trends 4.5/5.

5 Score as of February 3, 2022.

Outlook for Fiscal 2022

Take-Two is raising its outlook for the fiscal year ending March 31, 2022 and providing its initial outlook for its fiscal fourth quarter ending March 31, 2022:

Fiscal Year Ending March 31, 2022

  • GAAP net revenue is expected to range from $3.41 to $3.46 billion
  • GAAP net income is expected to range from $361 to $373 million
  • GAAP diluted net income per share is expected to range from $3.10 to $3.20
  • Share count used to calculate both GAAP and management reporting diluted net income per share is expected to be 116.6 million (1)
  • Net cash provided by operating activities is expected to be over $340 million
  • Adjusted Unrestricted Operating Cash Flow (Non-GAAP) is expected to be over $400 million (2)
  • Capital expenditures are expected to be approximately $170 million
  • Net Bookings (operational metric) are expected to range from $3.37 to $3.42 billion

The Company is also providing selected data and its management reporting tax rate of 16%, which are used internally by its management and Board of Directors to adjust the Company’s GAAP financial outlook in order to facilitate comparison of its operating performance between periods and to better understand its core business and future outlook:

 

 

Twelve Months Ending March 31, 2022

 

 

 

 

Financial Data

$ in millions

 

GAAP outlook (3)

 

Change in

deferred net

revenue and

related cost of

goods sold

 

Stock-based

compensation

 

Gain on

long-term

investments,

net

 

Amortization and

impairment of

acquired

intangibles

 

Reorganization &

acquisition

Net revenue

 

$3,410 to $3,460

 

$(40)

 

 

 

 

 

 

 

 

Cost of goods sold

 

$1,517 to $1,543

 

 

 

$(39)

 

 

 

$(51)

 

 

Operating expenses

 

$1,481 to $1,491

 

 

 

$(139)

 

 

 

$(11)

 

$(51)

Interest and other, net

 

$3

 

$(1)

 

 

 

$6

 

 

 

$(4)

Income before income taxes

 

$409 to $423

 

$(39)

 

$178

 

$(6)

 

$62

 

$55

Fourth Quarter Ending March 31, 2022

  • GAAP net revenue is expected to range from $835 to $885 million
  • GAAP net income is expected to range from $53 to $65 million
  • GAAP diluted net income per share is expected to range from $0.46 to $0.56
  • Share count used to calculate both GAAP and management reporting diluted net income per share is expected to be 116.6 million (4)
  • Net Bookings (operational metric) are expected to range from $808 to $858 million

The Company is also providing selected data and its management reporting tax rate of 16%, which are used internally by its management and Board of Directors to adjust the Company’s GAAP financial outlook in order to facilitate comparison of its operating performance between periods and to better understand its core business and future outlook:

 

 

Three Months Ending March 31, 2022

 

 

 

 

Financial Data

$ in millions

 

GAAP outlook (3)

 

Change in deferred

net revenue and

related cost of goods

sold

 

Stock-based

compensation

 

Amortization of

intangible assets

 

Reorganization &

Acquisition

Net revenue

 

$835 to $885

 

$(27)

 

 

 

 

 

 

Cost of goods sold

 

$380 to $406

 

$(6)

 

$(8)

 

$(12)

 

 

Operating expenses

 

$389 to $399

 

 

 

$(29)

 

$(1)

 

$(11)

Interest and other, net

 

$2

 

 

 

 

 

 

 

$(4)

Income before income taxes

 

$64 to $78

 

$(21)

 

$37

 

$13

 

$15

1)

Includes 115.5 million basic shares and 1.1 million shares representing the potential dilution from unvested employee stock grants.

2)

Adjusted for changes in restricted cash.

3)

The individual components of the financial outlook may not foot to the totals, as the Company does not expect actual results for every component to be at the low end or high end of the outlook range simultaneously.

4)

Includes 115.4 million basic shares and 1.2 million shares representing the potential dilution from unvested employee stock grants.

Key assumptions and dependencies underlying the Company’s outlook include: the timely delivery of the titles included in this financial outlook; a stable economic environment; continued consumer acceptance of Xbox One and PlayStation 4, as well as continued growth in the installed base of PlayStation 5 and Xbox Series X|S; the ability to develop and publish products that capture market share for these current generation systems while also leveraging opportunities on PC, mobile and other platforms; and stable foreign exchange rates. See also “Cautionary Note Regarding Forward Looking Statements” below. The Company's outlook does not take into account the potential acquisition of Zynga.

Product Releases

The following have been released since October 1, 2021:

Label

Product

Platforms

Release Date

2K

Mafia III: Definitive Edition

Stadia

October 1, 2021

Nordeus

Top Eleven 2022

iOs, Android

October 11, 2021

2K

PGA TOUR 2K21 Baller Edition

PS4, Xbox One, PC

October 14, 2021

2K

NBA 2K22 Arcade Edition

Apple Arcade

October 19, 2021

2K

Tiny Tina's Assault on Dragon Keep (standalone)

PS4, PS5, Xbox One, Xbox Series X|S, PC

November 9, 2021

Rockstar Games

Grand Theft Auto: The Trilogy – The Definitive Edition (digital release)

PS4, PS5, Xbox One, Xbox Series X|S, PC, Switch

November 11, 2021

2K

Borderlands 3 Ultimate Edition (physical only)

PS5, Xbox Series X

November 12, 2021

Rockstar Games

Grand Theft Auto Online: The Contract

PS4, Xbox One, PC

December 15, 2021

Rockstar Games

Grand Theft Auto: The Trilogy – The Definitive Edition (physical release)

PS4, Xbox One, Xbox Series X

December 17, 2021

Take-Two's future lineup announced to-date includes:

Label

Product

Platforms

Release Date

Private Division

OlliOlli World (digital only)

PS4, PS5, Xbox One, Xbox Series X|S, Switch, PC

February 8, 2022

Rockstar Games

Grand Theft Auto: The Trilogy – The Definitive Edition

Switch (physical only)

February 11, 2022 (U.S. release date; other region release dates may vary)

2K

WWE 2K22

PS4, PS5, Xbox One, Xbox Series X|S, PC

March 11, 2022

Rockstar Games

Grand Theft Auto V for PlayStation 5 and XBox Series X|S

PS5, Xbox Series X|S

March 15, 2022

Rockstar Games

Grand Theft Auto Online – Standalone

PS5, Xbox Series X|S

March 15, 2022

2K

Tiny Tina's Wonderlands

PS4, PS5, Xbox One, Xbox Series X|S, PC

March 25, 2022

Rockstar Games

Grand Theft Auto: The Trilogy — The Definitive Edition (mobile release)

iOS, Android

First Half of Calendar 2022

2K

Marvel's Midnight Suns

PS4, PS5, Xbox One, Xbox Series X|S, PC, Switch

Fall 2022 (Fiscal 2023)

Private Division

Kerbal Space Program 2

PS4, PS5, Xbox One, Xbox Series X|S, PC

Fiscal 2023

Conference Call

Take-Two will host a conference call today at 4:30 p.m. Eastern Time to review these results and discuss other topics. The call can be accessed by dialing (877) 407-0984 or (201) 689-8577. A live listen-only webcast of the call will be available by visiting http://ir.take2games.com and a replay will be available following the call at the same location.

Non-GAAP Financial Measure

In addition to reporting financial results in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses a Non-GAAP measure of financial performance: Adjusted Unrestricted Operating Cash Flow, which is defined as GAAP net cash from operating activities, adjusted for changes in restricted cash. The Company’s management believes it is important to consider Adjusted Unrestricted Operating Cash Flow, in addition to net cash from operating activities, as it provides more transparency into current business trends without regard to the timing of payments from restricted cash, which is primarily related to a dedicated account limited to the payment of certain internal royalty obligations.

This Non-GAAP financial measure is not intended to be considered in isolation from, as a substitute for, or superior to, GAAP results. This Non-GAAP financial measure may be different from similarly titled measures used by other companies. In the future, Take-Two may also consider whether other items should also be excluded in calculating this Non-GAAP financial measure used by the Company. Management believes that the presentation of this Non-GAAP financial measure provides investors with additional useful information to measure Take-Two's financial and operating performance. In particular, this measure facilitates comparison of our operating performance between periods and may help investors to understand better the operating results of Take-Two. Internally, management uses this Non-GAAP financial measure in assessing the Company's operating results and in planning and forecasting. A reconciliation of this Non-GAAP financial measure to the most comparable GAAP measure is contained in the financial tables to this press release.

Final Results

The financial results discussed herein are presented on a preliminary basis; final data will be included in Take-Two’s Quarterly Report on Form 10-Q for the period ended December 31, 2021.

About Take-Two Interactive Software

Headquartered in New York City, Take-Two Interactive Software, Inc. is a leading developer, publisher, and marketer of interactive entertainment for consumers around the globe. We develop and publish products principally through Rockstar Games, 2K, Private Division, and T2 Mobile Games. Our products are designed for console systems and personal computers, including smart phones and tablets, and are delivered through physical retail, digital download, online platforms, and cloud streaming services. The Company’s common stock is publicly traded on NASDAQ under the symbol TTWO. For more corporate and product information please visit our website at http://www.take2games.com.

All trademarks and copyrights contained herein are the property of their respective holders.

Cautionary Note Regarding Forward-Looking Statements

Statements contained herein which are not historical facts are considered forward-looking statements under federal securities laws and may be identified by words such as "anticipates," "believes," "estimates," "expects," "intends," "plans," "potential," "predicts," "projects," "seeks," “should,” "will," or words of similar meaning and include, but are not limited to, statements regarding the outlook for the Company's future business and financial performance. Such forward-looking statements are based on the current beliefs of our management as well as assumptions made by and information currently available to them, which are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual outcomes and results may vary materially from these forward-looking statements based on a variety of risks and uncertainties including: risks relating to our pending acquisition of Zynga; the uncertainty of the impact of the COVID-19 pandemic and measures taken in response thereto; the effect that measures taken to mitigate the COVID-19 pandemic have on our operations, including our ability to timely deliver our titles and other products, and on the operations of our counterparties, including retailers and distributors; the effects of the COVID-19 pandemic on both consumer demand and the discretionary spending patterns of our customers as the situation with the pandemic continues to evolve; the risks of conducting business internationally; the impact of changes in interest rates by the Federal Reserve and other central banks, including on our short-term investment portfolio; the impact of potential inflation; volatility in foreign currency exchange rates; our dependence on key management and product development personnel; our dependence on our NBA 2K and Grand Theft Auto products and our ability to develop other hit titles; our ability to leverage opportunities on PlayStation®5 and Xbox Series X|S; the timely release and significant market acceptance of our games; the ability to maintain acceptable pricing levels on our games; and risks associated with international operations.

Other important factors and information are contained in the Company's most recent Annual Report on Form 10-K, including the risks summarized in the section entitled "Risk Factors," the Company’s most recent Quarterly Report on Form 10-Q, and the Company's other periodic filings with the SEC, which can be accessed at www.take2games.com. All forward-looking statements are qualified by these cautionary statements and apply only as of the date they are made. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31,

 

Nine Months Ended December 31,

 

 

 

2021

 

 

 

2020

 

 

 

2021

 

 

 

2020

 

Net revenue

 

$

903,252

 

 

$

860,889

 

 

$

2,574,796

 

 

$

2,533,341

 

Cost of goods sold:

 

 

 

 

 

 

 

 

Internal royalties

 

 

172,766

 

 

 

137,657

 

 

 

477,730

 

 

 

479,524

 

Software development costs and royalties

 

 

43,057

 

 

 

83,514

 

 

 

274,963

 

 

 

374,332

 

Licenses

 

 

61,507

 

 

 

57,917

 

 

 

198,041

 

 

 

206,880

 

Product costs

 

 

73,049

 

 

 

67,156

 

 

 

186,042

 

 

 

194,702

 

Total cost of goods sold

 

 

350,379

 

 

 

346,244

 

 

 

1,136,776

 

 

 

1,255,438

 

Gross profit

 

 

552,873

 

 

 

514,645

 

 

 

1,438,020

 

 

 

1,277,903

 

Selling and marketing

 

 

135,286

 

 

 

139,906

 

 

 

375,159

 

 

 

338,376

 

General and administrative

 

 

130,706

 

 

 

98,624

 

 

 

362,484

 

 

 

292,230

 

Research and development

 

 

116,656

 

 

 

86,428

 

 

 

310,458

 

 

 

233,752

 

Depreciation and amortization

 

 

15,996

 

 

 

14,007

 

 

 

44,642

 

 

 

40,116

 

Business reorganization

 

 

123

 

 

 

(377

)

 

 

546

 

 

 

(138

)

Total operating expenses

 

 

398,767

 

 

 

338,588

 

 

 

1,093,289

 

 

 

904,336

 

Income from operations

 

 

154,106

 

 

 

176,057

 

 

 

344,731

 

 

 

373,567

 

Interest and other, net

 

 

(5,629

)

 

 

1,098

 

 

 

(7,228

)

 

 

12,022

 

Gain on long-term investments, net

 

 

3,662

 

 

 

39,291

 

 

 

6,054

 

 

 

38,636

 

Income before income taxes

 

 

152,139

 

 

 

216,446

 

 

 

343,557

 

 

 

424,225

 

Provision for income taxes

 

 

7,642

 

 

 

34,198

 

 

 

36,507

 

 

 

54,151

 

Net income

 

$

144,497

 

 

$

182,248

 

 

$

307,050

 

 

$

370,074

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

Basic earnings per share

 

$

1.25

 

 

$

1.58

 

 

$

2.66

 

 

$

3.23

 

Diluted earnings per share

 

$

1.24

 

 

$

1.57

 

 

$

2.63

 

 

$

3.2

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

Basic

 

 

115,269

 

 

 

115,004

 

 

 

115,572

 

 

 

114,436

 

Diluted

 

 

116,708

 

 

 

116,117

 

 

 

116,810

 

 

 

115,573

 

Computation of Basic EPS:

 

 

 

 

 

 

 

 

Net income

 

$

144,497

 

 

$

182,248

 

 

$

307,050

 

 

$

370,074

 

Weighted average shares outstanding - basic

 

 

115,269

 

 

 

115,004

 

 

 

115,572

 

 

 

114,436

 

Basic earnings per share

 

$

1.25

 

 

$

1.58

 

 

$

2.66

 

 

$

3.23

 

Computation of Diluted EPS:

 

 

 

 

 

 

 

 

Net income

 

$

144,497

 

 

$

182,248

 

 

$

307,050

 

 

$

370,074

 

Weighed average shares outstanding - basic

 

 

115,269

 

 

 

115,004

 

 

 

115,572

 

 

 

114,436

 

Add: dilutive effect of common stock equivalents

 

 

1,439

 

 

 

1,113

 

 

 

1,238

 

 

 

1,137

 

Weighted average common shares outstanding - diluted

 

 

116,708

 

 

 

116,117

 

 

 

116,810

 

 

 

115,573

 

Diluted earnings per share

 

$

1.24

 

 

$

1.57

 

 

$

2.63

 

 

$

3.20

 

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

 

 

 

 

 

 

 

December 31, 2021

 

March 31, 2021

 

 

(Unaudited)

 

 

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

986,741

 

 

$

1,422,884

 

Short-term investments

 

 

1,479,013

 

 

 

1,308,692

 

Restricted cash and cash equivalents

 

 

267,010

 

 

 

538,822

 

Accounts receivable, net of allowances of $350 and $350 at December 31, 2021 and March 31, 2021, respectively

 

 

647,907

 

 

 

552,762

 

Inventory

 

 

11,678

 

 

 

17,742

 

Software development costs and licenses

 

 

47,576

 

 

 

43,443

 

Deferred cost of goods sold

 

 

15,369

 

 

 

15,524

 

Prepaid expenses and other

 

 

249,719

 

 

 

320,646

 

Total current assets

 

 

3,705,013

 

 

 

4,220,515

 

 

 

 

 

 

Fixed assets, net

 

 

235,957

 

 

 

149,364

 

Right-of-use assets

 

 

212,491

 

 

 

164,763

 

Software development costs and licenses, net of current portion

 

 

737,935

 

 

 

490,892

 

Goodwill

 

 

679,997

 

 

 

535,306

 

Other intangibles, net

 

 

274,297

 

 

 

121,591

 

Deferred tax assets

 

 

77,721

 

 

 

90,206

 

Long-term restricted cash and cash equivalents

 

 

103,445

 

 

 

98,541

 

Other assets

 

 

331,097

 

 

 

157,040

 

Total assets

 

$

6,357,953

 

 

$

6,028,218

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

100,720

 

 

$

71,001

 

Accrued expenses and other current liabilities

 

 

1,026,246

 

 

 

1,204,090

 

Deferred revenue

 

 

910,899

 

 

 

928,029

 

Lease liabilities

 

 

34,480

 

 

 

31,595

 

Total current liabilities

 

 

2,072,345

 

 

 

2,234,715

 

Non-current deferred revenue

 

 

68,218

 

 

 

37,302

 

Non-current lease liabilities

 

 

209,646

 

 

 

159,671

 

Non-current software development royalties

 

 

113,991

 

 

 

110,127

 

Other long-term liabilities

 

 

228,016

 

 

 

154,511

 

Total liabilities

 

 

2,692,216

 

 

 

2,696,326

 

Stockholders' equity:

 

 

 

 

Preferred stock, $0.01 par value, 5,000 shares authorized; no shares issued and outstanding at December 31, 2021 and March 31, 2021

 

 

 

 

 

 

Common stock, $0.01 par value, 200,000 shares authorized; 139,007 and 137,584 shares issued and 115,326 and 115,163 outstanding at December 31, 2021 and March 31, 2021, respectively

 

 

1,391

 

 

 

1,376

 

Additional paid-in capital

 

 

2,541,492

 

 

 

2,288,781

 

Treasury stock, at cost; 23,681 and 22,421 common shares at December 31, 2021 and March 31, 2021, respectively

 

 

(1,020,584

)

 

 

(820,572

)

Retained earnings

 

 

2,178,021

 

 

 

1,870,971

 

Accumulated other comprehensive loss

 

 

(34,583

)

 

 

(8,664

)

Total stockholders' equity

 

$

3,665,737

 

 

$

3,331,892

 

Total liabilities and stockholders' equity

 

$

6,357,953

 

 

$

6,028,218

 

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

 

 

 

 

 

 

 

Nine Months Ended December 31,

 

 

 

2021

 

 

 

2020

 

Operating activities:

 

 

 

 

Net income

 

$

307,050

 

 

$

370,074

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Amortization of software development costs and licenses

 

 

112,117

 

 

 

113,392

 

Impairment of software development costs and licenses

 

 

65,689

 

 

 

 

Depreciation

 

 

44,732

 

 

 

40,790

 

Amortization and impairment of intellectual property

 

 

49,506

 

 

 

22,006

 

Stock-based compensation

 

 

142,540

 

 

 

139,835

 

Gain on long-term investments

 

 

(6,054

)

 

 

(40,588

)

Other, net

 

 

12,200

 

 

 

(89

)

Changes in assets and liabilities:

 

 

 

 

Accounts receivable

 

 

(85,788

)

 

 

19,544

 

Inventory

 

 

5,929

 

 

 

(6,452

)

Software development costs and licenses

 

 

(376,455

)

 

 

(144,951

)

Prepaid expenses and other assets

 

 

(123,709

)

 

 

(49,321

)

Deferred revenue

 

 

10,615

 

 

 

208,182

 

Deferred cost of goods sold

 

 

126

 

 

 

463

 

Accounts payable, accrued expenses and other liabilities

 

 

(139,337

)

 

 

114,776

 

Net cash provided by operating activities

 

 

19,161

 

 

 

787,661

 

Investing activities:

 

 

 

 

Change in bank time deposits

 

 

(43,921

)

 

 

73,000

 

Proceeds from available-for-sale securities

 

 

494,919

 

 

 

363,628

 

Purchases of available-for-sale securities

 

 

(632,530

)

 

 

(563,815

)

Purchases of fixed assets

 

 

(133,392

)

 

 

(40,207

)

Proceeds from sale of long-term investment

 

 

 

 

 

22,472

 

Purchases of long-term investments

 

 

(8,650

)

 

 

(16,452

)

Business acquisitions

 

 

(157,291

)

 

 

(79,525

)

Other

 

 

1,100

 

 

 

 

Net cash used in investing activities

 

 

(479,765

)

 

 

(240,899

)

Financing activities:

 

 

 

 

Tax payment related to net share settlements on restricted stock awards

 

 

(59,131

)

 

 

(60,586

)

Issuance of common stock

 

 

19,658

 

 

 

14,215

 

Loan repayment

 

 

(235

)

 

 

 

Repurchase of common stock

 

 

(200,012

)

 

 

 

Net cash used in financing activities

 

 

(239,720

)

 

 

(46,371

)

Effects of foreign currency exchange rates on cash, cash equivalents, and restricted cash and cash equivalents

 

 

(2,727

)

 

 

19,006

 

Net change in cash, cash equivalents, and restricted cash and cash equivalents

 

 

(703,051

)

 

 

519,397

 

Cash, cash equivalents, and restricted cash and cash equivalents, beginning of year

 

 

2,060,247

 

 

 

1,993,392

Cash, cash equivalents, and restricted cash and cash equivalents, end of period

 

$

1,357,196

 

 

$

2,512,789

 

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

 

 

Net Revenue and Net Bookings by Geographic Region, Distribution Channel, and Platform Mix

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

December 31, 2021

 

Three Months Ended

December 31, 2020

 

 

Amount

 

% of total

 

Amount

 

% of total

Net revenue by geographic region

 

 

 

 

 

 

 

 

United States

 

$

534,869

 

59.2 %

 

$

528,324

 

61.4 %

International

 

 

368,383

 

40.8 %

 

 

332,565

 

38.6 %

Total net revenue

 

$

903,252

 

100.0 %

 

$

860,889

 

100.0 %

 

 

 

 

 

 

 

 

 

Net Bookings by geographic region

 

 

 

 

 

 

 

 

United States

 

$

504,357

 

58.2 %

 

$

491,530

 

60.4 %

International

 

 

361,766

 

41.8 %

 

 

322,752

 

39.6 %

Total Net Bookings

 

$

866,123

 

100.0 %

 

$

814,282

 

100.0 %

 

 

 

 

 

 

 

 

 

Three Months Ended

December 31, 2021

 

Three Months Ended

December 31, 2020

 

 

Amount

 

% of total

 

Amount

 

% of total

Net revenue by distribution channel

 

 

 

 

 

 

 

 

Digital online

 

$

795,715

 

88.1 %

 

$

743,141

 

86.3 %

Physical retail and other

 

 

107,537

 

11.9 %

 

 

117,748

 

13.7 %

Total net revenue

 

$

903,252

 

100.0 %

 

$

860,889

 

100.0 %

 

 

 

 

 

 

 

 

 

Net Bookings by distribution channel

 

 

 

 

 

 

 

 

Digital online

 

$

762,327

 

88.0 %

 

$

679,043

 

83.4 %

Physical retail and other

 

 

103,796

 

12.0 %

 

 

135,239

 

16.6 %

Total Net Bookings

 

$

866,123

 

100.0 %

 

$

814,282

 

100.0 %

 

 

 

 

 

 

 

 

 

Three Months Ended

December 31, 2021

 

Three Months Ended

December 31, 2020

 

 

Amount

 

% of total

 

Amount

 

% of total

Net revenue by platform mix

 

 

 

 

 

 

 

 

Console

 

$

665,535

 

74.7 %

 

$

656,079

 

76.2 %

PC and other

 

 

133,907

 

14.8 %

 

 

135,565

 

15.7 %

Mobile

 

 

103,810

 

10.5 %

 

 

69,245

 

8.0 %

Total net revenue

 

$

903,252

 

100.0 %

 

$

860,889

 

100.0 %

 

 

 

 

 

 

 

 

 

Net Bookings by platform mix

 

 

 

 

 

 

 

 

Console

 

$

622,377

 

71.9 %

 

$

602,860

 

74.0 %

PC and other

 

 

135,557

 

15.7 %

 

 

136,184

 

16.7 %

Mobile

 

 

108,189

 

12.5 %

 

 

75,238

 

9.2 %

Total Net Bookings

 

 

866,123

 

100.0 %

 

$

814,282

 

100.0 %

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

 

 

Net Revenue and Net Bookings by Geographic Region, Distribution Channel, and Platform Mix

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

December 31, 2021

 

Nine Months Ended

December 31, 2020

 

 

Amount

 

% of total

 

Amount

 

% of total

Net revenue by geographic region

 

 

 

 

 

 

 

 

United States

 

$

1,542,975

 

59.9 %

 

$

1,502,397

 

59.3 %

International

 

 

1,031,821

 

40.1 %

 

 

1,030,944

 

40.7 %

Total net revenue

 

$

2,574,796

 

100.0 %

 

$

2,533,341

 

100.0 %

 

 

 

 

 

 

 

 

 

Net Bookings by geographic region

 

 

 

 

 

 

 

 

United States

 

$

1,526,916

 

59.6 %

 

$

1,691,457

 

61.1 %

International

 

 

1,035,489

 

40.4 %

 

 

1,076,609

 

38.9 %

Total Net Bookings

 

$

2,562,405

 

100.0 %

 

$

2,768,066

 

100.0 %

 

 

 

 

 

 

 

 

 

Nine Months Ended

December 31, 2021

 

Nine Months Ended

December 31, 2020

 

 

Amount

 

% of total

 

Amount

 

% of total

Net revenue by distribution channel

 

 

 

 

 

 

 

 

Digital online

 

$

2,315,618

 

89.9 %

 

$

2,204,401

 

87.0 %

Physical retail and other

 

 

259,178

 

10.1 %

 

 

328,940

 

13.0 %

Total net revenue

 

$

2,574,796

 

100.0 %

 

$

2,533,341

 

100.0 %

 

 

 

 

 

 

 

 

 

Net Bookings by distribution channel

 

 

 

 

 

 

 

 

Digital online

 

$

2,318,770

 

90.5 %

 

$

2,409,672

 

87.1 %

Physical retail and other

 

 

243,635

 

9.5 %

 

 

358,394

 

12.9 %

Total Net Bookings

 

$

2,562,405

 

100.0 %

 

$

2,768,066

 

100.0 %

 

 

 

 

 

 

 

 

 

Nine Months Ended

December 31, 2021

 

Nine Months Ended

December 31, 2020

 

 

Amount

 

% of total

 

Amount

 

% of total

Net revenue by platform mix

 

 

 

 

 

 

 

 

Console

 

$

1,864,058

 

72.4 %

 

$

1,909,033

 

75.4 %

PC and other

 

 

409,554

 

15.9 %

 

 

439,511

 

17.3 %

Mobile

 

 

301,184

 

11.7 %

 

 

184,797

 

7.3 %

Total net revenue

 

$

2,574,796

 

100.0 %

 

$

2,533,341

 

100.0 %

 

 

 

 

 

 

 

 

 

Net Bookings by platform mix

 

 

 

 

 

 

 

 

Console

 

$

1,838,242

 

71.7 %

 

$

2,087,109

 

75.4 %

PC and other

 

 

420,254

 

16.4 %

 

 

475,941

 

17.2 %

Mobile

 

 

303,909

 

11.9 %

 

 

205,016

 

8.4 %

Total Net Bookings

 

$

2,562,405

 

100.0 %

 

$

2,768,066

 

100 %

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

 

 

 

 

 

 

 

 

ADDITIONAL DATA

 

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2021

Net revenue

 

Cost of goods sold-

Internal royalties

 

Cost of goods sold-

Software development

costs and royalties

 

Cost of goods

sold- Licenses

 

Cost of goods

sold- Product

costs

 

Selling and

marketing

As reported

$

903,252

 

 

$

172,766

 

 

$

43,057

 

 

$

61,507

 

 

$

73,049

 

 

$

135,286

 

Net effect from deferred revenue and related cost of goods sold

 

(37,129

)

 

 

 

 

2,586

 

 

 

(194

)

 

 

2,668

 

 

 

Stock-based compensation

 

 

 

 

 

(9,445

)

 

 

 

 

 

 

(7,189

)

Amortization and impairment of acquired intangibles

 

 

 

 

 

(12,485

)

 

 

 

 

 

 

(800

)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2021

General and

administrative

 

Research and

development

 

Depreciation and

amortization

 

Business

reorganization

 

Interest and

other, net

 

Gain on

long-term

investments, net

As reported

$

130,706

 

 

$

116,656

 

 

$

15,996

 

 

$

123

 

 

$

(5,629

)

 

$

3,662

 

Net effect from deferred revenue and related cost of goods sold

 

 

 

 

 

 

 

 

 

1,039

 

 

 

Stock-based compensation

 

(16,478

)

 

 

(13,232

)

 

 

 

 

 

 

 

 

Amortization and impairment of acquired intangibles

 

 

 

(1,614

)

 

 

(331

)

 

 

 

 

 

 

Impact of business reorganization

 

 

 

 

 

 

 

(123

)

 

 

 

 

Acquisition related expenses

 

(13,976

)

 

 

 

 

 

 

 

 

 

 

Gain on long-term investments, net

 

 

 

 

 

 

 

 

 

 

 

(3,662

)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2020

Net revenue

 

Cost of goods sold-

Internal royalties

 

Cost of goods sold-

Software development

costs and royalties

 

Cost of goods

sold- Licenses

 

Cost of goods

sold- Product

costs

 

Selling and

marketing

As reported

$

860,889

 

 

$

137,657

 

 

$

83,514

 

 

$

57,917

 

 

$

67,156

 

 

$

139,906

 

Net effect from deferred revenue and related cost of goods sold

 

(46,607

)

 

 

 

 

1,240

 

 

 

4,617

 

 

 

3,991

 

 

 

Stock-based compensation

 

 

 

 

 

(13,100

)

 

 

 

 

 

 

(4,131

)

Amortization and impairment of acquired intangibles

 

 

 

 

 

(6,428

)

 

 

 

 

 

 

(1,550

)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2020

General and

administrative

 

Research and

development

 

Depreciation and

amortization

 

Business

reorganization

 

Interest and

other, net

 

Gain on

long-term

investments, net

As reported

$

98,624

 

 

$

86,428

 

 

$

14,007

 

 

$

(377

)

 

$

1,098

 

 

$

39,291

 

Net effect from deferred revenue and related cost of goods sold

 

 

 

 

 

 

 

 

 

(2,874

)

 

 

Stock-based compensation

 

(15,538

)

 

 

(8,347

)

 

 

 

 

 

 

 

 

Amortization and impairment of acquired intangibles

 

 

 

(1,708

)

 

 

(236

)

 

 

 

 

 

 

Impact of business reorganization

 

 

 

 

 

 

 

377

 

 

 

 

 

Acquisition related expenses

 

(3,427

)

 

 

 

 

 

 

 

 

 

 

Gain on long-term investments

 

 

 

 

 

 

 

 

 

 

 

(39,291

)

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

 

 

 

 

 

 

 

 

ADDITIONAL DATA

 

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended December 31, 2021

Net revenue

 

Cost of goods sold-

Internal royalties

 

Cost of goods sold-

Software development

costs and royalties

 

Cost of goods

sold- Licenses

 

Cost of goods

sold- Product

costs

 

Selling and

marketing

As reported

$

2,574,796

 

 

$

477,730

 

 

$

274,963

 

 

$

198,041

 

 

$

186,042

 

 

$

375,159

 

Net effect from deferred revenue and related cost of goods sold

 

(12,391

)

 

 

 

 

6,166

 

 

 

199

 

 

 

(83

)

 

 

Stock-based compensation

 

 

 

 

 

(31,831

)

 

 

 

 

 

 

(22,356

)

Amortization and impairment of acquired intangibles

 

 

 

 

 

(37,581

)

 

 

 

 

 

 

(4,450

)

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended December 31, 2021

General and

administrative

 

Research and

development

 

Depreciation and

amortization

 

Business

reorganization

 

Interest and

other, net

 

Gain on

long-term

investments, net

As reported

$

362,484

 

 

$

310,458

 

 

$

44,642

 

 

$

546

 

 

$

(7,228

)

 

$

6,054

 

Net effect from deferred revenue and related cost of goods sold

 

 

 

 

 

 

 

 

 

1,364

 

 

 

Stock-based compensation

 

(50,341

)

 

 

(38,012

)

 

 

 

 

 

 

 

 

Amortization and impairment of acquired intangibles

 

 

 

(4,964

)

 

 

(1,037

)

 

 

 

 

 

 

Impact of business reorganization

 

 

 

 

 

 

 

(546

)

 

 

 

 

Acquisition related expenses

 

(39,530

)

 

 

 

 

 

 

 

 

 

 

Gain on long-term investments, net

 

 

 

 

 

 

 

 

 

 

 

(6,054

)

Nine Months Ended December 31, 2020

Net revenue

 

Cost of goods sold-

Internal royalties

 

Cost of goods sold-

Software development

costs and royalties

 

Cost of goods

sold- Licenses

 

Cost of goods

sold- Product

costs

 

Selling and

marketing

As reported

$

2,533,341

 

 

$

479,524

 

 

$

374,332

 

 

$

206,880

 

 

$

194,702

 

 

$

338,376

 

Net effect from deferred revenue and related cost of goods sold

 

234,723

 

 

 

 

 

21,499

 

 

 

173

 

 

 

403

 

 

 

Stock-based compensation

 

 

 

 

 

(61,529

)

 

 

 

 

 

 

(13,298

)

Amortization and impairment of acquired intangibles

 

 

 

 

 

(14,122

)

 

 

 

 

 

 

(2067

)

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended December 31, 2020

General and

administrative

 

Research and

development

 

Depreciation and

amortization

 

Business

reorganization

 

Interest and

other, net

 

Gain on

long-term

investments, net

As reported

$

292,230

 

 

$

233,752

 

 

$

40,116

 

 

$

(138

)

 

$

12,022

 

 

$

38,636

 

Net effect from deferred revenue and related cost of goods sold

 

 

 

 

 

 

 

 

 

(5,300

)

 

 

Stock-based compensation

 

(42,568

)

 

 

(22,440

)

 

 

 

 

 

 

 

 

Amortization and impairment of acquired intangibles

 

 

 

(4,945

)

 

 

(519

)

 

 

 

 

 

 

Impact of business reorganization

 

 

 

 

 

 

 

138

 

 

 

 

 

Acquisition related expenses

 

(5,939

)

 

 

 

 

 

 

 

 

 

 

Gain on long-term investments

 

 

 

 

 

 

 

 

 

 

 

(38,636

)

 

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES

 

 

 

 

RECONCILIATION OF GAAP TO NON-GAAP MEASURE

 

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended December 31,

 

 

2021

 

2020

Net cash from operating activities

 

$

19,161

 

$

787,661

Net change in Restricted cash (1)

 

 

259,777

 

 

66,671

Adjusted Unrestricted Operating Cash Flow

 

$

278,938

 

$

854,332

 

 

 

 

 

 

 

Nine Months Ended December 31,

 

 

 

2021

 

 

2020

Restricted cash beginning of period

 

$

637,363

 

$

635,728

Restricted cash end of period

 

 

370,455

 

 

862,957

Restricted cash related to acquisitions

 

 

7,131

 

 

293,900

(1) Net change in Restricted cash

 

$

259,777

 

$

66,671

 

(Investor Relations)
Nicole Shevins
Senior Vice President
Investor Relations & Corporate Communications
Take-Two Interactive Software, Inc.
(646) 536-3005
Nicole.Shevins@take2games.com

(Corporate Press)
Alan Lewis
Vice President
Corporate Communications & Public Affairs
Take-Two Interactive Software, Inc.
(646) 536-2983
Alan.Lewis@take2games.com

Source: Take-Two Interactive