Take-Two Interactive Software(US:TTWO)2021-08-03 03:06Financial Data and Key Metrics Changes - The company reported first quarter net bookings of $711 million, exceeding expectations and marking the second highest Q1 on record [7][53] - GAAP net revenue declined 2% to $830 million, while cost of goods sold decreased by 31% to $330 million [55] - GAAP net income was $152 million, or $1.30 per share, compared to $89 million or $0.77 per share in the same quarter last year [56] Business Line Data and Key Metrics Changes - Grand Theft Auto Online and Grand Theft Auto V were significant contributors to performance, with Grand Theft Auto V selling over 150 million units [10][53] - Red Dead Redemption 2 exceeded expectations, selling over 38 million units, with Red Dead Online showing strong performance due to new content [13][53] - NBA 2K21 sold over 11 million units and remains the number one sports title in the U.S., with a 13% growth in first-time spenders [14][53] Market Data and Key Metrics Changes - The company expects net bookings to be approximately 60% from the United States and 40% from international markets [58] - The largest contributors to recurrent consumer spending were NBA 2K and Grand Theft Auto Online, with strong performance across free-to-play offerings [22][53] Company Strategy and Development Direction - The company is focused on enhancing its mobile gaming segment, integrating acquisitions like Nordeus to leverage expertise and achieve cost synergies [8][9] - The company reiterated its guidance for net bookings of $3.2 billion to $3.3 billion for fiscal 2022, despite some shifts in planned releases [25][57] - The company aims to provide innovative ways for audiences to stay engaged with titles post-launch, reflecting a strategic priority [20][27] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the interactive entertainment sector's future and the company's competitive positioning, citing a strong balance sheet and a robust pipeline of titles [27][50] - The company noted that media consumption patterns are stabilizing, with recurrent consumer spending expected to decline by 9% compared to a prior outlook of a 15% decline [21][59] Other Important Information - The company has made significant investments in talent and infrastructure to support its multi-year pipeline [8][29] - The NBA 2K League continues to grow its audience, with over 2 million followers on social media platforms [48] Q&A Session All Questions and Answers Question: Thoughts on gender inequality in the industry - The company emphasizes diversity as key to success, with a diverse board and management team, and initiatives to enhance diversity in recruitment [67][69] Question: Impact of COVID on recurrent consumer spending - Recurrent consumer spending declined 25%, better than the expected 30%, driven by strong performance in GTA Online and the addition of Nordeus [72][73] Question: Interest levels for GTA Enhanced Edition - Management is optimistic about the Enhanced Edition's performance, noting the consistent success of GTA V and GTA Online [76][77] Question: Delays in immersive core titles - The delays are due to the need for more time to polish the titles, not related to COVID [109][111] Question: Current thoughts on the Chinese market - The company sees significant opportunities in China, with NBA 2K Online being the number one online PC sports game in the region [115] Question: Valuations in the mobile acquisition market - The company has not seen changes in the market yet, with valuations remaining high due to sector growth [118]