The paragraph is a transcript of the opening remarks from a conference call for Take-Two Interactive's Fourth Quarter 2025 Earnings. The conference operator, Abbie, introduces the call, indicating that it will include a presentation followed by a Q&A session. Nicole Shevins, Senior VP of Investor Relations, then welcomes participants and outlines the purpose of the call, which is to discuss the company's financial results for the fourth quarter and fiscal year 2025 ending March 31, 2025. The call features presentations from Strauss Zelnick, Karl Slatoff, and Lainie Goldstein. Nicole also highlights that any forward-looking statements made are based on current beliefs and assumptions, are not obligations to update, and could differ significantly from actual results due to various factors detailed in SEC filings. All financial data presented is based on GAAP standards with year-over-year comparisons.

The paragraph discusses the financial performance and future outlook of Take-Two Interactive. They concluded their 2025 fiscal year with impressive results, achieving fourth quarter net bookings of $1.58 billion, driven by successful game launches from their labels, including 2K, Rockstar Games, and Zynga. NBA 2K saw significant growth in consumer spending, while Rockstar Games exceeded forecasts with its popular series. Zynga continued to perform well with its games. For fiscal 2026, they project net bookings between $5.9 billion and $6 billion, anticipating ongoing positive trends and the release of new titles like Mafia: The Old Country and Borderlands 4. Rockstar plans to release Grand Theft Auto VI in fiscal year 2027.

The paragraph discusses the success and anticipation for Rockstar's upcoming game, Grand Theft Auto VI, highlighting its record-breaking trailer views and cultural impact. It also covers the impressive performance of NBA 2K25, noting its increase in sales and user engagement compared to its predecessor. Additionally, it mentions the success of various NBA 2K brand extensions, including the NBA 2K25 Arcade Edition, NBA 2K Online in China, and the NBA 2K All-Stars mobile title, thanking key NBA figures for their support.

The paragraph discusses 2K's recent successes with game releases, highlighting WWE 2K25's critical acclaim with a Metacritic score of 84 for Xbox Series X, and its integration into WWE programming and events like WrestleMania 41. The game also showed a significant increase in consumer spending. Additionally, 2K plans to launch WWE 2K on Switch 2 and mobile devices. PGA TOUR 2K25 was also well-received, boasting strong consumer spending growth. Firaxis Games released Sid Meier's Civilization VII, continuing the franchise's tradition of innovation, with expansions to platforms like VR and an upcoming Switch 2 release. The paragraph emphasizes the collaborative efforts with partners like TKO and PGA, as well as ongoing development and audience expansion strategies.

The Grand Theft Auto series continues to surpass sales expectations, with GTA V having sold over 215 million units and GTA Online driving recurrent consumer spending growth through new content and memberships. Rockstar Games is expanding its engagement options with continued work on its FiveM platform and Red Dead Redemption 2, which also saw strong growth. Zynga has exceeded performance expectations, maintaining momentum into Fiscal 2026, with Peak Games and its titles like Match Factory and Toon Blast showing significant growth and profitability. Rollic's Color Block Jam has quickly become profitable and ranks among the top-grossing titles on the U.S. Apple App Store. Additionally, Zynga's game Empires & Puzzles has shown improved player engagement through enhanced features and player feedback. Zynga is also preparing several new titles for market release.

The company's direct-to-consumer (DTC) strategy is thriving, with new offers and personalization driving better conversions. They see potential for further expansion due to favorable court rulings. As the third anniversary of acquiring Zynga approaches, they've successfully integrated it, with Zynga thriving in the mobile market. The company is focused on delivering high-quality entertainment and plans to release Grand Theft Auto VI in Fiscal 2027, aiming for record net bookings. They have an optimistic pipeline, with 38 titles planned through fiscal 2028, including 13 titles in fiscal 2026. Notably, "Mafia: The Old Country" will be released on August 8.

The paragraph discusses the strong start for pre-orders of Borderlands 4 following its gameplay trailer debut at PAX East, with plans for its release on September 12 and future availability on Switch 2. It also mentions the excitement around two new Vault Hunters and updates to the gear system. Additionally, it outlines the release of NBA 2K and WWE 2K, as well as five mobile titles, including WWE 2K for Netflix and Civilization VII games for VR and Switch 2. Looking ahead, 2K and Gearbox plan to deliver 25 titles by fiscal 2027-2028, including Grand Theft Auto VI. The paragraph concludes with a note on the company's strong financial performance at the end of fiscal 2025.

The company positioned itself for sustainable, long-term growth by releasing new titles, advancing key releases, acquiring Gearbox, and implementing a cost reduction program, setting up for a period of growth and profitability. In the fourth quarter, they achieved net bookings of $1.58 billion, exceeding their guidance and driven by strong performances from NBA 2K25, Zynga, and other key titles. Recurrent consumer spending grew by 14%, making up 77% of net bookings. They launched new games including Civilization 7, PGA TOUR 2K25, and WWE 2K25. Despite operating expenses rising due to a significant impairment expense, on a management basis, expenses only increased by 3%. Their fiscal 2025 net bookings reached $5.65 billion, at the top of their guidance range.

The paragraph discusses the company's financial performance and projections. Recurrent consumer spending grew by 7% and accounted for 80% of net bookings. Specific game titles had varied performance, with NBA 2K seeing high-teens growth but Grand Theft Auto Online declining modestly. The company's operating cash flow showed a smaller outflow than forecasted due to timing of tax payments and lower development costs. Capital expenditures exceeded expectations, driven by higher game technology expenses. GAAP net revenue increased by 5% to $5.63 billion, while the cost of revenue decreased by 17% due to lower impairment of acquired intangibles and timing of development credits. Operating expenses rose by 28% due to impairment charges, with management basis expenses increasing by 11%. For fiscal 2026, the company projects net bookings to grow by 5% at the midpoint, driven by major games and apps like NBA 2K, GTA series, and others, expecting flat recurrent consumer spending from fiscal 2025. The net bookings breakdown is anticipated to be 45% Zynga, 39% 2K, and 16% Rockstar Games.

The company anticipates an operating cash flow of $130 million and plans $140 million in capital expenditures primarily for game technology and office expansions. Projected GAAP net revenue is between $5.95 billion and $6.05 billion, with costs ranging from $2.52 billion to $2.55 billion and operating expenses between $3.78 billion and $3.8 billion. An operating expense growth of 3% is expected due to increased marketing costs. For the fiscal first quarter, net bookings are projected at $1.25 billion to $1.3 billion, driven by key franchises such as NBA 2K and Grand Theft Auto. Recurrent consumer spending is expected to increase by 7%, with strong growth in NBA 2K, stagnant mobile performance, and a slight decrease in Grand Theft Auto Online. Two new releases of Civilization 7 are scheduled. GAAP net revenue for the quarter is anticipated to be between $1.35 billion and $1.4 billion, with costs between $544 million and $562 million, and operating expenses ranging from $908 million to $918 million. Long-term prospects remain strong, with significant growth expected in fiscal 2027.

The paragraph is an excerpt from a financial call involving Strauss Zelnick, expressing gratitude to Take-Two's stakeholders, including colleagues and shareholders, for their support and successful year. It transitions into a Q&A segment where Eric Handler from ROTH Capital asks about Take-Two's decision to price the game Mafia at $50 or $60 instead of the industry-discussed $80. Strauss Zelnick explains that Take-Two employs variable pricing aimed at delivering more value to consumers than what they charge, emphasizing the importance of making their entertainment widely accessible.

The paragraph is a conversation involving Eric Handler, Lainie Goldstein, and Doug Creutz discussing financial aspects of a business. Eric asks Lainie about a $3.5 billion goodwill impairment, speculating it may be related to Zynga. Lainie clarifies they haven't specified which reporting unit the impairment affects but mentions it's due to updated long-term forecasts, which are routinely tested for impairment. Doug Creutz then inquires about potential structural changes in the business or industry that might prevent the company from reaching past operating margin levels achieved during successful times like after Red Dead 2’s release and during the pandemic. Lainie responds, asserting there’s no reason they can't achieve those margins again, as they are focused on cost reduction and efficiencies to offset increased development costs.

The paragraph discusses the strong performance of the mobile gaming segment, particularly highlighting Zynga's success in creating new mobile hits like "Match Factory!" and "Color Block Jam." Strauss Zelnick attributes this success to the talented creative and publishing teams at Zynga, including those at Peak and Rollic studios. Lainie Goldstein notes that while mature top titles showed outstanding results in fiscal 2025, some moderation in trends is expected for fiscal 2026, potentially affecting the business. Colin Sebastian and other analysts are inquiring about these dynamics, and Chris Schoell from UBS mentions a new baseline for the business anticipated once "GTA VI" launches in fiscal 2027.

The paragraph features a discussion between Strauss Zelnick and Chris Schoell about the company's future financial expectations and the impact of the anticipated release of Grand Theft Auto VI (GTA VI). Zelnick expresses optimism about future net bookings and free cash flow, foreseeing sequential growth for fiscal years 2026 and 2027, despite not providing specific long-term numbers. Schoell notes a past increase in engagement and monetization following the first GTA VI trailer and inquires if a similar effect is occurring with the second trailer. Zelnick mentions that while there was a decline in engagement for GTA Online and Red Dead Online over the full fiscal year, the fourth quarter showed better-than-expected results for these platforms.

The paragraph discusses recent developments related to the gaming industry. It mentions that Rockstar Games' trailer for GTA VI set a record with 475 million views in the first 24 hours, signaling strong anticipation for the game's release. Additionally, a question is addressed concerning the Nintendo Switch as a distribution partner. Take-Two Interactive is releasing four titles on the new Nintendo Switch platform, which is a larger array than previously offered for a Nintendo launch. This marks an increased level of cooperation and optimism about the platform. However, the company acknowledges that not every title will be available on every platform and decisions are made on a case-by-case basis. The discussion concludes with a reference to Zynga's success in the mobile gaming space.

The paragraph discusses the influence of past game releases like Match Factory! on future Zynga titles, such as Color Block Jam, highlighting the learning experiences from each project. While acknowledging the distinctive development backgrounds of each game, with Match Factory! from Peak and Color Block Jam from Rollic, it emphasizes the collaborative benefits within Zynga and its parent company, Take-Two, such as sharing best practices and utilizing a vast consumer database for strategic advantages. Despite these resources, the core challenge remains to create content that consumers desire. Ultimately, the company strives for creativity, innovation, and efficiency to produce popular games.

The paragraph is a discussion between Matthew Cost from Morgan Stanley and Karl Slatoff about the strong performance of the NBA 2K franchise. Matthew asks about the factors behind NBA 2K's continued success and future impact of court rulings on direct-to-consumer opportunities, particularly in mobile gaming. Karl attributes NBA 2K's success to the team's ongoing strategy, effort, and innovations, such as listening to consumer feedback and enhancing features like MyTEAM mode. He highlights that consumer engagement has significantly increased, leading to a 7% rise in units year-over-year.

The paragraph discusses the success of a company driven by a focus on quality and the positive impact of MyTEAM in a recent quarter. Strauss Zelnick mentions the growth of their direct-to-consumer mobile business following the Zynga acquisition, noting it has significantly contributed to their business. He anticipates a decline in third-party distribution costs and a more open market, hinted by recent court rulings. Eric Sheridan from Goldman Sachs asks about their partnership with Netflix in scaling games and potential for transforming gaming IP into mainstream media. Karl Slatoff responds positively about the partnership, praising Netflix’s commitment to gaming and their marketing power, and notes success with the collaboration on a few titles so far.

The paragraph encompasses a financial discussion during an earnings call, focusing on partnerships with Netflix and fiscal '26 guidance. A company executive highlights ongoing collaborations with Netflix, including a BioShock movie, noting that such partnerships are beneficial but not essential. Another executive, Lainie Goldstein, outlines a projected 3% increase in operating expenses due to elevated marketing costs for current and future titles, expecting net bookings to grow by 6%, thus outpacing expense growth. Lastly, the discussion touches on the company's confidence in its fiscal '26 bookings guidance, clarifying that the range provided is typical and not unusually narrow.

In the paragraph, Michael Hickey from The Benchmark Company asks about the excitement and demand for the upcoming game GTA VI, and also inquires about software pricing strategies. Strauss Zelnick responds, attributing the high anticipation for GTA VI to the enduring success and popularity of GTA V, which has sold 215 million units across three console generations and continues to engage players through Grand Theft Auto Online and GTA+. He compares the anticipation for the new game to the anticipation for a new James Bond movie, noting the ongoing engagement with the current iteration.

The paragraph discusses the anticipation and reception of the upcoming Grand Theft Auto game, highlighting the impressive 475 million views of its trailer within 24 hours and the positive market research results. It emphasizes that Rockstar's main focus is on creating quality entertainment rather than pre-emptively claiming success. There is also mention of the company's approach to pricing, which is variable and emphasizes delivering great value to consumers. Michael Hickey thanks Strauss Zelnick, and a subsequent question from Brian Pitz focuses on how console price increases might impact the company's financial guidance and the allocation of software development costs, particularly with respect to Grand Theft Auto VI. Strauss Zelnick mentions that the company's guidance is for the next 10 months of their fiscal year.

The paragraph is from a financial discussion regarding tariffs, development costs, and internal royalties within a company. It covers a few key points: the uncertainty of predicting tariffs and their impact, confidence that the company's guidance won't be significantly affected unless tariffs change drastically, and an acknowledgment of a substantial installed base on their platforms, except for Nintendo Switch 2, which is not yet launched. Lainie Goldstein mentions $2 billion in development costs supporting their future release schedule. Martin Yang from Oppenheimer asks about the increase in internal royalties within the cost of goods sold (COGS), which Lainie Goldstein attributes to changes in product mix. Finally, the conference concludes with Strauss Zelnick offering closing remarks.

The paragraph is part of a positive meeting announcement for Take-Two, expressing excitement and gratitude for the hard work of their employees and support from shareholders. The company acknowledges the challenges in the industry, feels confident in their upcoming release schedule, and stresses the importance of humility and consistent effort to ensure continued success. The meeting concludes with thanks to the participants.

This summary was generated with AI and may contain some inaccuracies.