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Take-Two (TTWO) Reports Loss in Q1 Earnings, Revenues Up Y/Y

·4-min read

Take-Two Interactive Software TTWO reported a first-quarter fiscal 2023 loss of 76 cents per share against the year-ago quarter’s earnings of $1.30 per share.

Net revenues jumped 35.5% year over year to $1.10 billion. Net Bookings surged 40.9% to $1 billion.

The Zacks Consensus Estimate for earnings and revenues was pegged at 53 cents per share and $1.04 billion, respectively.

Game revenues (92.5% of revenues) improved 28% year over year to $1.02 billion.  Advertising revenues (7.5% of revenues) jumped 389.4% year over year to $83.2 million.

TakeTwo Interactive Software, Inc. Price, Consensus and EPS Surprise

TakeTwo Interactive Software, Inc. Price, Consensus and EPS Surprise
TakeTwo Interactive Software, Inc. Price, Consensus and EPS Surprise

TakeTwo Interactive Software, Inc. price-consensus-eps-surprise-chart | TakeTwo Interactive Software, Inc. Quote

 

Top-Line Details

Digital revenues (94.1% of revenues) improved 40.1% year over year to $1.04 billion. Physical retail revenues (5.9% of revenues) declined 10.9% year over year to $64.6 million.

Recurrent consumer spending (virtual currency, add-on content and in-game purchases, including the allocated value of virtual currency and add-on content incorporated in special editions of certain games) increased 44% year over year and accounted for 75% of total revenues.

Region-wise, revenues from the United States (61.9% of revenues) soared 38.5% year over year to $682.9 million. International revenues (38.1% of revenues) increased 31.1% year over year to $419.5 million.

Based on platforms, revenues from consoles (55.1% of revenues) increased 0.8% year over year to $607.2 million. Revenues from mobile (33.5% of revenues) surged 349.1% year over year to $369.6 million.

Revenues from PC and other (11.4% of revenues) decreased 2.3% year over year to $125.6 million.

Operating Details

Take-Two’s gross profit increased 37.9% year over year to $666.7 million. Reported gross margin of 60.5% expanded 100 basis points (bps) on a year-over-year basis.

Operating expenses surged 124.9% year over year to $704.1 million.

Operating loss was $37.4 million against the year-ago quarter’s operating income of $170.5 million.

Balance Sheet

As of Jun 30, 2022, Take-Two had $2.55 billion in cash, cash equivalents and short-term investments compared with $2.55 billion as of Mar 31, 2022.

The company had a debt of $3.3 billion as of Jun 30.

Net cash provided by operating activities was $100.8 million compared with $148.2 million reported in the year-ago quarter.

Guidance

For the second quarter of fiscal 2023, Take Two expects GAAP net revenues between $1.37 billion and $1.42 billion. The company expects loss between 96 and 86 cents per share.

Net bookings are projected between $1.5 billion and $1.55 billion.

For fiscal 2023, Take-Two expects GAAP net revenues between $5.73 billion and $5.83 billion. The company expects loss between $2.75 and $2.50 per share.

Net bookings are projected between $5.8 billion and $5.9 billion.

Zacks Rank & Other Stocks to Consider

Take-Two currently carries a Zacks Rank #2 (Buy).

Vitru Limited VTRU is a better-ranked stocks that investors can consider in the broader Zacks Consumer Discretionary sector. Vitru currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Enthusiast Gaming EGLX and On ONON are couple of same-ranked stocks that investors can consider in the broader sector. Both Enthusiast Gaming and On have a Zacks Rank #2 (Buy).

Vitru is set to announce second-quarter fiscal 2022 results on Aug 25. VTRU shares have been up 15.4% year to date.

Enthusiast is set to announce second-quarter 2022 results on Aug 15. EGLX shares have been down 37.8% year to date.

On is set to announce second-quarter 2022 results on Aug 16. ONON shares have been down 40.5% year to date.


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