Take-Two Interactive Software, Inc. Reports Strong Results for Fiscal Second Quarter 2021
GAAP net revenue was
GAAP net income per diluted share increased 37% to
GAAP net cash provided by operating activities for the six-months ended
Adjusted Unrestricted Operating Cash Flow (Non-GAAP) for the six-months ended
Net Bookings grew to
Company raises outlook for fiscal year 2021, including record Net Bookings
Fiscal Second Quarter 2021 Financial Highlights
GAAP net revenue was
Digitally-delivered GAAP net revenue increased 16% to
GAAP net income increased 38% to
During the six-month period ended
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 |
|||||||||||||||||||||||
Financial Data |
|||||||||||||||||||||||
$ in thousands |
Statement of operations |
|
Change in deferred net revenue and related cost of goods sold |
|
Stock-based compensation |
|
Impact of business reorganization |
|
Business acquisition |
|
Amortization & impairment of acquired intangible assets |
|
Loss on long-term investments |
||||||||||
|
|
|
|
||||||||||||||||||||
Net revenue |
|
116,392 |
|
|
|
|
|
||||||||||||||||
Cost of goods sold |
432,505 |
13,450 |
|
(19,396 |
) |
|
|
(4,411 |
) |
|
|||||||||||||
Gross Profit |
408,637 |
102,942 |
|
19,396 |
|
|
|
4,411 |
|
|
|||||||||||||
Operating expenses |
293,270 |
(25,912 |
) |
(239 |
) |
(2,512 |
) |
(2,364 |
) |
|
|||||||||||||
Income from operations |
115,367 |
102,942 |
|
45,308 |
|
239 |
|
2,512 |
|
6,775 |
|
|
|||||||||||
Interest and other, net |
2,706 |
(1,669 |
) |
|
|
|
|
||||||||||||||||
Loss on long-term investments |
655 |
|
|
|
|
|
(655 |
) |
|||||||||||||||
Income before income taxes |
117,418 |
101,273 |
|
45,308 |
|
239 |
|
2,512 |
|
6,775 |
|
655 |
|
In order to calculate net income per diluted share for management reporting purposes, the Company uses its fully diluted share count of 115.4 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 second quarter 2021, total Net Bookings grew to
Catalog accounted for
Digitally-delivered Net Bookings grew 14% to
Management Comments
“Our positive momentum continued in the fiscal second quarter with operating results that significantly exceeded our expectations,” said
“As a result of our better-than-expected second quarter operating results and increased forecast for the balance of the year, we are raising our fiscal 2021 outlook, and we now expect record Net Bookings of over
“With the strongest development pipeline in the history of the Company and our ongoing investment in emerging markets, platforms and business models, Take-Two is exceedingly well positioned to capitalize on the many positive trends in our industry and to generate growth and margin expansion over the long-term.”
COVID-19 Response
At Take-Two, our number one priority is the health and safety of our employees and their families. After moving to work-from-home environments by mid-March, several of our offices have re-opened on a voluntary basis. With more people staying at home, we have experienced, and are continuing to experience, heightened levels of engagement and Net Bookings growth-to-date. The full extent of the impact of the COVID-19 pandemic 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
Business and Product Highlights
Since
Take-Two:
- Acquired privately-held
Playdots, Inc. for final consideration of$196 million , comprised of$98 million in cash and the balance in newly issued shares of Take-Two common stock. Founded in 2013 and based inNew York City ,Playdots builds mobile games with unique and thoughtful designs. They are best known for Two Dots, which has been downloaded over 80 million times since its launch six years ago and that continues to deeply engage audiences throughout the world.Playdots is led byNir Efrat , who came toPlaydots inMarch 2018 and serves as its Chief Executive Officer. Prior toPlaydots , Efrat was Head of Franchises and Studios at King, the creator of the widely successfulCandy Crush mobile game series. He will continue to leadPlaydots and its approximately 70 employees.Playdots has a robust development pipeline with a number of innovative puzzle games planned for launch over the coming years.
- Acquired Ruffian Games. Based in
Dundee, Scotland , the studio will operate under the new name of Rockstar Dundee. Terms of the acquisition were not disclosed. Founded in 2008 byGary Liddon andBilly Thomson , Ruffian partnered with Microsoft to work on the Crackdown series, and with 343 Industries on Halo: Reach from the Halo Master Chief Collection, among many other projects. Ruffian’s talented team of just over 40 have a depth of development experience that even includes work on some early Rockstar titles from the Grand Theft Auto and Manhunt series. Both Liddon and Thomson will remain on-board as Co-Studio Directors of Rockstar Dundee. - Released new free content updates for Red Dead Online including:
- The Naturalist, a massive new update to Red Dead Online featuring the latest specialist Role: The Naturalist, giving players the opportunity to track, study and sample animals for Naturalist
Harriet Davenport , or hunt them for the trapperGus MacMillan . The update also featured Legendary Animals, Legendary Animal Sighting Missions, Poaching Missions, new Free Roam Events, two new weapons, a new variant of the Varmint Rifle, the Advanced Camera, new clothing, and an assortment of unique items and rewards in the latest edition ofOutlaw Pass : The Outlaw Pass No. 3.
- The Naturalist, a massive new update to Red Dead Online featuring the latest specialist Role: The Naturalist, giving players the opportunity to track, study and sample animals for Naturalist
- Released new free content updates for Grand Theft Auto Online, including The Los Santos Summer Special Update, which introduced six Superyacht Life Co-Op Missions, 15 new Vehicles, nine Open Wheel Race Tracks and the new Open Wheel Race Creator, new Business Battles, the Diamond Adversary Series, two new Arcade Cabinets, new collectibles, clothing and Ambient Events, plus multiple gameplay improvements.
- Both Grand Theft Auto Online and Red Dead Online will receive major updates later this fiscal year, featuring an extension to existing Frontier Pursuits for Red Dead Online, as well as Grand Theft Auto Online’s biggest update ever, featuring a new take on Heists in a new location.
2K:
- Launched NBA 2K21, the next iteration of the top-rated and top-selling NBA video game simulation series, for current-generation platforms worldwide. With its release, NBA 2K21 offers one-of-a-kind immersion into all facets of NBA basketball and basketball culture, including exciting improvements upon its best-in-class gameplay, competitive and community online features and deep, varied game modes. Featuring Portland Trail Blazers’ superstar
Damian Lillard on the cover, the current-gen version of NBA 2K21 is available for$59.99 on Xbox One, PlayStation 4, Switch, PC and Stadia. The NBA 2K21 Mamba Forever Edition for current-gen features basketball legendKobe Bryant on a unique custom cover with his No. 8 jersey and is available for$99.99 . Of note, the Mamba Forever Edition includes dual-access to NBA 2K21 for current and next-gen versions of the game on either PlayStation or Xbox consoles, providing purchasers with a copy of the standard edition of the game on the other generation within the same console family. NBA 2K21 will be available for PlayStation 5 and Xbox Series X when they launch inNovember 2020 . - Launched Mafia: Definitive Edition for PlayStation 4, Xbox One, and PC. Developed by 2K and Hangar 13, Mafia: Definitive Edition is a comprehensive, built-from-the-ground-up remake of the original Mafia. The remake features an updated script, additional cutscenes, all-new gameplay sequences and features, a re-recorded orchestral score, and other enhancements.
- Launched WWE 2K Battlegrounds, the arcade-style brawler that will bring over-the-top WWE action to a new level of intensity, for PlayStation 4, Xbox One, PC , Switch and Stadia. Developed by Saber Interactive, WWE 2K Battlegrounds brings fast-paced action and an assortment of power-ups, special moves, unconventional melee items and interactive environments to take the brawl to the next level. Players can take on the challenges alone or compete with friends and family in person or online in cooperative and competitive multiplayer modes.
- Launched
PGA TOUR 2K21 fromHB Studios for PlayStation 4, Xbox One, Switch (digital), PC and Stadia. The game featuresPGA TOUR professionalJustin Thomas as its cover athlete; officially licensed pro players, courses and gear; the most realistic course scanning to date; play-by-play commentary byLuke Elvy andRich Beem ; a new PGA TOUR Career Mode, online and local multiplayer; course and player customization; and online societies. - Announced that Borderlands 3 will be available for PlayStation 5 and Xbox Series X when they launch in
November 2020 . In addition, 2K announced a secondSeason Pass for Borderlands 3 will be available onNovember 10, 2020 for all previously released and next-gen versions of the game.Season Pass 2 will include two brand new content add-ons - Designer’s Cut, which will add all new ways to play Borderlands 3 by introducing a new Skill Tree for each Vault Hunter, a new standalone mode called Arms Race, and more; and the Director’s Cut, which is planned for release in spring of next year. - Announced that Season 7 of WWE SuperCard, the newest addition to the action-packed collectible card-battling game, is scheduled to launch in
November 2020 as a free, downloadable update for iOS, Android™ and Facebook Gaming. - The NBA 2K League concluded its third season on
August 28, 2020 with Wizards District Gaming winning the 2020 League Championship. Games were simulcast live on the NBA 2K League’s Twitch and YouTube channels, as well asESPN's platforms and Sportsnet (Canada ). The NBA 2K League has begun the tryout process for its fourth season, set to take place in 2021. - Announced a partnership with
OneTeam Partners and theNational Football League Players Association that will allow the label to include the names, numbers, images and likenesses for over 2,000 current NFL players in multiple, non-simulation football games that are currently in development and set to launch starting in calendar year 2021, during fiscal 2022.
Private Division:
- Released, along with
Obsidian Entertainment , The Outer Worlds: Peril on Gorgon, the first narrative-led expansion for the critically acclaimed, darkly humorous sci-fi RPG for the PlayStation 4, Xbox One and PC. The expansion will be coming later to Nintendo Switch. The Outer Worlds: Peril on Gorgon is available individually or at a discount as part ofThe Outer Worlds Expansion Pass , which will also include The Outer Worlds: Murder on Eridanos, the second expansion set to launch in the first half of calendar 2021. - Announced three new publishing agreements with top independent developers
Moon Studios ,League of Geeks , and Roll7. In collaboration with these developers, Private Division will announce more details about each specific project in the future. The first of these titles is expected to launch in fiscal year 2022.
Outlook for Fiscal 2021
Take-Two is providing its initial outlook for its fiscal third quarter ending
Third Quarter Ending
- GAAP net revenue is expected to range from
$760 to$810 million - GAAP net income is expected to range from
$128 to$140 million - GAAP diluted net income per share is expected to range from
$1.10 to$1.21 - Share count used to calculate both GAAP and management reporting diluted net income per share is expected to be 115.9 million (1)
- Net Bookings (operational metric) are expected to range from
$675 to$725 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 |
|||||||||
Financial Data |
|||||||||
$ in millions |
GAAP outlook (2) |
Change in deferred net revenue and related cost of goods sold |
Stock-based compensation |
Amortization of acquired intangible assets |
|||||
Net revenue |
|
|
( |
|
|
|
|
||
|
|
|
|
|
|
|
|||
Cost of goods sold |
|
|
|
|
( |
|
( |
||
|
|
|
|
|
|
|
|||
Operating Expenses |
|
|
|
|
( |
|
( |
||
Interest and other, net |
( |
|
|
|
|
|
|
||
Income before income taxes |
|
|
( |
|
|
|
|
Fiscal Year Ending
- GAAP net revenue is expected to range from
$3.05 to$3.15 billion - GAAP net income is expected to range from
$372 to$403 million - GAAP diluted net income per share is expected to range from
$3.22 to$3.49 - Share count used to calculate both GAAP and management reporting diluted net income per share is expected to be 115.5 million (3)
- Net cash provided by operating activities is expected to be over
$690 million - Adjusted Unrestricted Operating Cash Flow (Non-GAAP) is expected to be over
$650 million (4) - Capital expenditures are expected to be approximately
$75 million - Net Bookings (operational metric) are expected to range from
$3.15 to$3.25 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 |
||||||||||||||||
Financial Data |
||||||||||||||||
$ in millions |
GAAP outlook (2) |
Change in deferred net revenue and related cost of goods sold |
Stock-based compensation |
Loss on long-term investments |
Amortization of acquired intangible assets |
Reorganization & Acquisition |
||||||||||
|
|
|||||||||||||||
Net revenue |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of goods sold |
|
|
|
|
( |
|
|
|
( |
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating Expenses |
|
|
|
|
( |
|
|
|
( |
|
( |
|||||
Interest and other, net |
( |
|
|
|
|
|
( |
|
|
|
|
|||||
Income before income taxes |
|
|
|
|
|
|
|
|
|
|
|
1) |
Includes 115.0 million basic shares and 0.9 million shares representing the potential dilution from unvested employee stock grants. |
|
2) |
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. |
|
3) |
Includes 114.6 million basic shares and 0.9 million shares representing the potential dilution from unvested employee stock grants. |
|
4) |
Includes a |
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; the ability to develop and publish products that capture market share for these current generation systems while also leveraging opportunities on PlayStation 5 and Xbox Series X, PC, mobile and other platforms; and stable foreign exchange rates. See also “Cautionary Note Regarding Forward Looking Statements” below.
Product Releases
The following titles have been released since
Label |
Title |
Platforms |
Release Date |
Private Division |
Kerbal Space Program: Shared Horizons (free update) |
PC |
|
2K |
|
PS4, Xbox One, Switch, PC |
|
|
Red Dead Online: The Naturalist |
PS4, Xbox One, PC, Stadia |
|
2K |
|
PS4, Xbox One, Switch, PC, Stadia |
|
2K |
NBA 2K21 |
PS4, Xbox One, Switch, PC, Stadia |
|
Private Division |
The Outer Worlds: Peril on Gorgon (DLC) |
PS4, Xbox One, PC |
|
2K |
Borderlands 3: Psycho Krieg and the Fantastic Flustercluck (DLC) |
PS4, Xbox One, Switch, PC, Stadia |
|
2K |
WWE 2K Battlegrounds |
PS4, Xbox One, Switch, PC, Stadia |
|
2K |
|
PS4, Xbox One, Switch, PC |
|
2K |
Mafia I Definitive Edition |
PS4, Xbox One, PC |
|
2K |
|
PS4, Xbox One, Switch, PC, Stadia |
|
Private Division |
Kerbal Space Program: Shared Horizons (free update) |
PS4, Xbox One |
|
2K |
|
PS4, Xbox One, Switch, PC, Stadia |
|
2K |
WWE 2K Battlegrounds DLC (free update) |
PS4, Xbox One, Switch, PC, Stadia |
|
|
|||
Take-Two's lineup of future titles announced to-date includes: |
|||
|
|||
Label |
Title |
Platforms |
Release Date |
2K |
Borderlands 3 |
Xbox Series X (digital only) |
|
2K |
NBA 2K21 |
Xbox Series X |
|
2K |
Borderlands 3 - |
PS4, PS5, Xbox One, Xbox Series X, PC, Stadia |
|
2K |
Borderlands 3 |
PS5 (digital only) |
|
2K |
NBA 2K21 |
PS5 |
|
2K |
WWE SuperCard: Season 7 |
iOS, Android, Facebook Gaming |
|
Private Division |
The Outer Worlds: Murder on Eridanos (DLC) |
PS4, Xbox One, PC |
1st Half Calendar 2021 |
|
Grand Theft Auto V |
PS5, Xbox Series X |
Fiscal 2022 |
Private Division |
Kerbal Space Program 2 |
PS4, Xbox One, PC |
Fiscal 2023 |
Conference Call
Take-Two will host a conference call today at
Non-GAAP Financial Measure
In addition to reporting financial results in accordance with
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
About
Headquartered in
All trademarks and copyrights contained herein are the property of their respective holders.
Cautionary Note Regarding Forward-Looking Statements
The 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: 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 consumer demand and the discretionary spending patterns of our customers; the impact of reductions in interest rates by the
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
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||
(in thousands, except per share amounts) | ||||||||||||
Three months ended |
Six months ended |
|||||||||||
2020 |
|
2019 |
|
2020 |
|
2019 |
||||||
Net revenue |
$ |
841,142 |
$ |
857,841 |
$ |
1,672,452 |
$ |
1,398,300 |
||||
Cost of goods sold: | ||||||||||||
Internal royalties |
|
127,804 |
|
109,991 |
|
341,867 |
|
172,880 |
||||
Software development costs and royalties |
|
142,771 |
|
211,996 |
|
290,818 |
|
320,437 |
||||
Licenses |
|
92,944 |
|
59,693 |
|
148,963 |
|
82,197 |
||||
Product costs |
|
68,986 |
|
86,568 |
|
127,546 |
|
134,203 |
||||
Total cost of goods sold |
|
432,505 |
|
468,248 |
|
909,194 |
|
709,717 |
||||
Gross profit |
|
408,637 |
|
389,593 |
|
763,258 |
|
688,583 |
||||
Selling and marketing |
|
113,691 |
|
149,566 |
|
198,470 |
|
241,387 |
||||
General and administrative |
|
91,433 |
|
76,659 |
|
193,606 |
|
151,492 |
||||
Research and development |
|
74,216 |
|
76,197 |
|
147,324 |
|
145,160 |
||||
Depreciation and amortization |
|
13,691 |
|
12,024 |
|
26,109 |
|
23,281 |
||||
Business reorganization |
|
239 |
|
327 |
|
239 |
|
713 |
||||
Total operating expenses |
|
293,270 |
|
314,773 |
|
565,748 |
|
562,033 |
||||
Income from operations |
|
115,367 |
|
74,820 |
|
197,510 |
|
126,550 |
||||
Interest and other, net |
|
2,706 |
|
8,054 |
|
10,924 |
|
18,479 |
||||
Loss on long-term investments |
|
655 |
|
- |
|
655 |
|
- |
||||
Income before income taxes |
|
117,418 |
|
82,874 |
|
207,779 |
|
145,029 |
||||
Provision for income taxes |
|
18,097 |
|
11,059 |
|
19,953 |
|
26,934 |
||||
Net income |
$ |
99,321 |
$ |
71,815 |
$ |
187,826 |
$ |
118,095 |
||||
Earnings per share: | ||||||||||||
Basic earnings per share |
$ |
0.87 |
$ |
0.63 |
$ |
1.65 |
$ |
1.05 |
||||
Diluted earnings per share |
$ |
0.86 |
$ |
0.63 |
$ |
1.63 |
$ |
1.04 |
||||
Weighted average shares outstanding: | ||||||||||||
Basic |
|
114,444 |
|
113,117 |
|
114,153 |
|
112,869 |
||||
Diluted |
|
115,414 |
|
114,077 |
|
115,245 |
|
113,925 |
||||
Computation of Basic EPS: | ||||||||||||
Net income |
$ |
99,321 |
$ |
71,815 |
$ |
187,826 |
$ |
118,095 |
||||
Weighted average shares outstanding - basic |
|
114,444 |
|
113,117 |
|
114,153 |
|
112,869 |
||||
Basic earnings per share |
$ |
0.87 |
$ |
0.63 |
$ |
1.65 |
$ |
1.05 |
||||
Computation of Diluted EPS: | ||||||||||||
Net income for diluted EPS calculation |
$ |
99,321 |
$ |
71,815 |
$ |
187,826 |
$ |
118,095 |
||||
Weighted average shares outstanding - basic |
|
114,444 |
|
113,117 |
|
114,153 |
|
112,869 |
||||
Add: dilutive effect of common stock equivalents |
|
970 |
|
960 |
|
1,092 |
|
1,056 |
||||
Weighted average common shares outstanding - diluted |
|
115,414 |
|
114,077 |
|
115,245 |
|
113,925 |
||||
Diluted earnings per share |
$ |
0.86 |
$ |
0.63 |
$ |
1.63 |
$ |
1.04 |
||||
CONSOLIDATED BALANCE SHEETS | ||||||||
(in thousands, except per share amounts) | ||||||||
|
2020 |
|
|
2020 |
|
|||
ASSETS | (Unaudited) | |||||||
Current assets: | ||||||||
Cash and cash equivalents |
$ |
1,345,099 |
|
$ |
1,357,664 |
|
||
Short-term investments |
|
1,040,786 |
|
|
644,003 |
|
||
Restricted cash and cash equivalents |
|
450,145 |
|
|
546,604 |
|
||
Accounts receivable, net of allowances of |
||||||||
respectively |
|
787,818 |
|
|
592,555 |
|
||
Inventory |
|
26,934 |
|
|
19,108 |
|
||
Software development costs and licenses |
|
73,714 |
|
|
40,316 |
|
||
Deferred cost of goods sold |
|
15,410 |
|
|
19,598 |
|
||
Prepaid expenses and other |
|
192,192 |
|
|
273,503 |
|
||
Total current assets |
|
3,932,098 |
|
|
3,493,351 |
|
||
Fixed assets, net |
|
133,404 |
|
|
131,888 |
|
||
Right-of-use assets |
|
156,310 |
|
|
154,284 |
|
||
Software development costs and licenses, net of current portion |
|
403,390 |
|
|
401,778 |
|
||
|
521,000 |
|
|
386,494 |
|
|||
Other intangibles, net |
|
126,392 |
|
|
51,260 |
|
||
Deferred tax assets |
|
117,692 |
|
|
116,676 |
|
||
Long-term restricted cash and cash equivalents |
|
289,536 |
|
|
89,124 |
|
||
Other assets |
|
156,332 |
|
|
123,977 |
|
||
Total assets |
$ |
5,836,154 |
|
$ |
4,948,832 |
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable |
$ |
85,103 |
|
$ |
65,684 |
|
||
Accrued expenses and other current liabilities |
|
1,148,617 |
|
|
1,169,884 |
|
||
Deferred revenue |
|
1,063,064 |
|
|
777,784 |
|
||
Lease liabilities |
|
29,051 |
|
|
25,187 |
|
||
Total current liabilities |
|
2,325,835 |
|
|
2,038,539 |
|
||
Non-current deferred revenue |
|
32,880 |
|
|
28,339 |
|
||
Non-current lease liabilities |
|
150,793 |
|
|
152,059 |
|
||
Non-current software development royalties |
|
302,435 |
|
|
104,417 |
|
||
Other long-term liabilities |
|
122,929 |
|
|
86,234 |
|
||
Total liabilities |
|
2,934,872 |
|
|
2,409,588 |
|
||
Stockholders' equity: | ||||||||
Preferred stock, |
|
- |
|
|
- |
|
||
Common stock, |
||||||||
issued and 114,928 and 113,506 outstanding at |
|
1,373 |
|
|
1,359 |
|
||
Additional paid-in capital |
|
2,285,394 |
|
|
2,134,748 |
|
||
|
(820,572 |
) |
|
(820,572 |
) |
|||
Retained earnings |
|
1,469,911 |
|
|
1,282,085 |
|
||
Accumulated other comprehensive loss |
|
(34,824 |
) |
|
(58,376 |
) |
||
Total stockholders' equity |
|
2,901,282 |
|
|
2,539,244 |
|
||
Total liabilities and stockholders' equity |
$ |
5,836,154 |
|
$ |
4,948,832 |
|
||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
(in thousands) | |||||||||
Six months ended |
|||||||||
|
2020 |
|
|
2019 |
|
||||
Operating activities: | |||||||||
Net income |
$ |
187,826 |
|
$ |
118,095 |
|
|||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Amortization and impairment of software development costs and licenses |
|
92,664 |
|
|
72,505 |
|
|||
Depreciation |
|
25,826 |
|
|
23,037 |
|
|||
Amortization of intellectual property |
|
11,801 |
|
|
10,627 |
|
|||
Stock-based compensation |
|
98,719 |
|
|
113,199 |
|
|||
Other, net |
|
(2,631 |
) |
|
4,325 |
|
|||
Changes in assets and liabilities: | |||||||||
Accounts receivable |
|
(189,477 |
) |
|
(463,019 |
) |
|||
Inventory |
|
(7,266 |
) |
|
(12,064 |
) |
|||
Software development costs and licenses |
|
(127,290 |
) |
|
(51,932 |
) |
|||
Prepaid expenses and other current and other non-current assets |
|
65,296 |
|
|
(131,055 |
) |
|||
Deferred revenue |
|
284,441 |
|
|
66,148 |
|
|||
Deferred cost of goods sold |
|
4,753 |
|
|
15,287 |
|
|||
Accounts payable, accrued expenses and other liabilities |
|
182,083 |
|
|
379,005 |
|
|||
Net cash provided by operating activities |
|
626,745 |
|
|
144,158 |
|
|||
Investing activities: | |||||||||
Change in bank time deposits |
|
(218,239 |
) |
|
6,720 |
|
|||
Proceeds from available-for-sale securities |
|
260,729 |
|
|
137,071 |
|
|||
Purchases of available-for-sale securities |
|
(435,511 |
) |
|
(141,244 |
) |
|||
Purchases of fixed assets |
|
(25,021 |
) |
|
(25,532 |
) |
|||
Purchases of long-term investments |
|
(9,100 |
) |
|
(4,500 |
) |
|||
Business acquisitions |
|
(75,482 |
) |
|
(8,715 |
) |
|||
Net cash used in investing activities |
|
(502,624 |
) |
|
(36,200 |
) |
|||
Financing activities: | |||||||||
Tax payment related to net share settlements on restricted stock awards |
|
(48,202 |
) |
|
(61,478 |
) |
|||
Issuance of common stock |
|
6,503 |
|
|
- |
|
|||
Net cash used in financing activities |
|
(41,699 |
) |
|
(61,478 |
) |
|||
Effects of foreign currency exchange rates on cash, cash equivalents, and restricted cash and cash equivalents |
|
8,966 |
|
|
(8,063 |
) |
|||
Net change in cash, cash equivalents, and restricted cash and cash equivalents |
|
91,388 |
|
|
38,417 |
|
|||
Cash, cash equivalents, and restricted cash and cash equivalents, beginning of year |
|
1,993,392 |
|
|
1,391,986 |
|
|||
Cash, cash equivalents, and restricted cash and cash equivalents, end of period |
$ |
2,084,780 |
|
$ |
1,430,403 |
|
|||
Net Revenue and Net Bookings by |
||||||||||||
(in thousands) | ||||||||||||
Three Months Ended |
Three Months Ended |
|||||||||||
Amount | % of Total | Amount | % of Total | |||||||||
Net revenue by geographic region | ||||||||||||
$ |
503,583 |
60 |
% |
$ |
494,661 |
58 |
% |
|||||
International |
|
337,559 |
40 |
% |
|
363,180 |
42 |
% |
||||
Total net revenue |
$ |
841,142 |
100 |
% |
$ |
857,841 |
100 |
% |
||||
Net bookings by geographic region | ||||||||||||
$ |
612,813 |
64 |
% |
$ |
567,503 |
60 |
% |
|||||
International |
|
344,721 |
36 |
% |
|
383,013 |
40 |
% |
||||
Total net bookings |
$ |
957,534 |
100 |
% |
$ |
950,516 |
100 |
% |
||||
Three Months Ended |
Three Months Ended |
|||||||||||
Amount | % of Total | Amount | % of Total | |||||||||
Net revenue by distribution channel | ||||||||||||
Digital online |
$ |
711,299 |
85 |
% |
$ |
615,774 |
72 |
% |
||||
Physical retail and other |
|
129,843 |
15 |
% |
|
242,067 |
28 |
% |
||||
Total net revenue |
$ |
841,142 |
100 |
% |
$ |
857,841 |
100 |
% |
||||
Net bookings by distribution channel | ||||||||||||
Digital online |
$ |
791,705 |
83 |
% |
$ |
695,346 |
73 |
% |
||||
Physical retail and other |
|
165,829 |
17 |
% |
|
255,170 |
27 |
% |
||||
Total net bookings |
$ |
957,534 |
100 |
% |
$ |
950,516 |
100 |
% |
||||
Three Months Ended |
Three Months Ended |
|||||||||||
Amount | % of Total | Amount | % of Total | |||||||||
Net revenue by platform mix | ||||||||||||
Console |
$ |
641,269 |
76 |
% |
$ |
651,818 |
76 |
% |
||||
PC and other |
|
199,873 |
24 |
% |
|
206,023 |
24 |
% |
||||
Total net revenue |
$ |
841,142 |
100 |
% |
$ |
857,841 |
100 |
% |
||||
Net bookings by platform mix | ||||||||||||
Console |
$ |
761,450 |
80 |
% |
$ |
737,085 |
78 |
% |
||||
PC and other |
|
196,084 |
20 |
% |
|
213,431 |
22 |
% |
||||
Total net bookings |
$ |
957,534 |
100 |
% |
$ |
950,516 |
100 |
% |
||||
Net Revenue and Net Bookings by |
||||||||||||
(in thousands) | ||||||||||||
Six Months Ended |
Six Months Ended |
|||||||||||
Amount | % of Total | Amount | % of Total | |||||||||
Net revenue by geographic region | ||||||||||||
$ |
974,073 |
58 |
% |
$ |
825,140 |
59 |
% |
|||||
International |
|
698,379 |
42 |
% |
|
573,160 |
41 |
% |
||||
Total net revenue |
$ |
1,672,452 |
100 |
% |
$ |
1,398,300 |
100 |
% |
||||
Net bookings by geographic region | ||||||||||||
$ |
1,199,927 |
61 |
% |
$ |
826,738 |
60 |
% |
|||||
International |
|
753,857 |
39 |
% |
|
546,018 |
40 |
% |
||||
Total net bookings |
$ |
1,953,784 |
100 |
% |
$ |
1,372,756 |
100 |
% |
||||
Six Months Ended |
Six Months Ended |
|||||||||||
Amount | % of Total | Amount | % of Total | |||||||||
Net revenue by distribution channel | ||||||||||||
Digital online |
$ |
1,437,525 |
86 |
% |
$ |
1,043,555 |
75 |
% |
||||
Physical retail and other |
|
234,927 |
14 |
% |
|
354,745 |
25 |
% |
||||
Total net revenue |
$ |
1,672,452 |
100 |
% |
$ |
1,398,300 |
100 |
% |
||||
Net bookings by distribution channel | ||||||||||||
Digital online |
$ |
1,706,894 |
87 |
% |
$ |
1,077,825 |
79 |
% |
||||
Physical retail and other |
|
246,890 |
13 |
% |
|
294,931 |
21 |
% |
||||
Total net bookings |
$ |
1,953,784 |
100 |
% |
$ |
1,372,756 |
100 |
% |
||||
Six Months Ended |
Six Months Ended |
|||||||||||
Amount | % of Total | Amount | % of Total | |||||||||
Net revenue by Platform Mix | ||||||||||||
Console |
$ |
1,252,954 |
75 |
% |
$ |
1,086,632 |
78 |
% |
||||
PC and other |
|
419,498 |
25 |
% |
|
311,668 |
22 |
% |
||||
Total net revenue |
$ |
1,672,452 |
100 |
% |
$ |
1,398,300 |
100 |
% |
||||
Net bookings by platform mix | ||||||||||||
Console |
$ |
1,484,249 |
76 |
% |
$ |
1,049,716 |
76 |
% |
||||
PC and other |
|
469,535 |
24 |
% |
|
323,040 |
24 |
% |
||||
Total net bookings |
$ |
1,953,784 |
100 |
% |
$ |
1,372,756 |
100 |
% |
||||
ADDITIONAL DATA | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Three Months Ended |
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 |
$ |
841,142 |
|
$ |
127,804 |
|
$ |
142,771 |
|
$ |
92,944 |
|
$ |
68,986 |
|
$ |
113,691 |
|
|||||
Net effect from deferral and related cost of goods sold |
|
116,392 |
|
|
16,209 |
|
|
(3,994 |
) |
|
1,235 |
|
|||||||||||
Stock-based compensation |
|
(19,396 |
) |
|
(4,439 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(4,411 |
) |
|
(517 |
) |
|||||||||||||||||
Three Months Ended |
General and administrative |
|
Research and development |
|
Depreciation and amortization |
|
Business reorganization |
|
Interest and other, net |
|
Loss on long- term investments |
||||||||||||
As reported |
$ |
91,433 |
|
$ |
74,216 |
|
$ |
13,691 |
|
$ |
239 |
|
$ |
2,706 |
|
$ |
655 |
|
|||||
Net effect from deferral and related cost of goods sold |
|
(1,669 |
) |
||||||||||||||||||||
Stock-based compensation |
|
(13,830 |
) |
|
(7,643 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(1,684 |
) |
|
(163 |
) |
|||||||||||||||||
Impact of business reorganization |
|
(239 |
) |
||||||||||||||||||||
Loss on long-term investments |
|
(655 |
) |
||||||||||||||||||||
Acquisition related expenses |
|
(2,512 |
) |
||||||||||||||||||||
Three Months Ended |
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 |
$ |
857,841 |
|
$ |
109,991 |
|
$ |
211,996 |
|
$ |
59,693 |
|
$ |
86,568 |
|
$ |
149,566 |
|
|||||
Net effect from deferral and related cost of goods sold |
|
92,675 |
|
|
(26,161 |
) |
|
1,133 |
|
|
(1,904 |
) |
|||||||||||
Stock-based compensation |
|
(27,832 |
) |
|
(3,744 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(3,311 |
) |
||||||||||||||||||||
Three Months Ended |
General and administrative |
|
Research and development |
|
Depreciation and amortization |
|
Business reorganization |
|
Interest and other, net |
||||||||||||||
As reported |
$ |
76,659 |
|
$ |
76,197 |
|
$ |
12,024 |
|
$ |
327 |
|
$ |
8,054 |
|
||||||||
Net effect from deferral and related cost of goods sold |
|
1,306 |
|
||||||||||||||||||||
Stock-based compensation |
|
(13,576 |
) |
|
(10,616 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(1,546 |
) |
|
(121 |
) |
|||||||||||||||||
Impact of business reorganization |
|
(327 |
) |
||||||||||||||||||||
Acquisition related expenses |
|
(41 |
) |
||||||||||||||||||||
ADDITIONAL DATA | |||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Six Months Ended |
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 |
$ |
1,672,452 |
|
$ |
341,867 |
|
$ |
290,818 |
|
$ |
148,963 |
|
$ |
127,546 |
|
$ |
198,470 |
|
|||||
Net effect from deferral and related cost of goods sold |
|
281,331 |
|
|
20,260 |
|
|
(4,444 |
) |
|
(3,589 |
) |
|||||||||||
Stock-based compensation |
|
(48,429 |
) |
|
(9,167 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(7,694 |
) |
|
(517 |
) |
|||||||||||||||||
Six Months Ended |
General and administrative |
|
Research and development |
|
Depreciation and amortization |
|
Business reorganization |
|
Interest and other, net |
|
Loss on long- term investments |
||||||||||||
As reported |
$ |
193,606 |
|
$ |
147,324 |
|
$ |
26,109 |
|
$ |
239 |
|
$ |
10,924 |
|
$ |
655 |
|
|||||
Net effect from deferral and related cost of goods sold |
|
(2,430 |
) |
||||||||||||||||||||
Stock-based compensation |
|
(27,030 |
) |
|
(14,093 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(3,237 |
) |
|
(283 |
) |
|||||||||||||||||
Impact of business reorganization | |||||||||||||||||||||||
Loss on long-term investments |
|
(655 |
) |
||||||||||||||||||||
Acquisition related expenses |
|
(2,512 |
) |
||||||||||||||||||||
|
(239 |
) |
|||||||||||||||||||||
Six Months Ended |
Net revenue |
|
Cost of goods sold- Internal royalties |
|
Cost of goods sold- Software development costs and royalties |
|
Cost of goods sold- Product costs |
|
Cost of goods sold- Licenses |
|
Selling and marketing |
||||||||||||
As reported |
$ |
1,398,300 |
|
$ |
172,880 |
|
$ |
320,437 |
|
$ |
134,203 |
|
$ |
82,197 |
|
$ |
241,387 |
|
|||||
Net effect from deferral and related cost of goods sold |
|
(25,544 |
) |
|
(39,320 |
) |
|
(17,553 |
) |
|
344 |
|
|||||||||||
Stock-based compensation |
|
(58,630 |
) |
|
(10,220 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(7,015 |
) |
||||||||||||||||||||
Six Months Ended |
General and administrative |
|
Research and development |
|
Depreciation and amortization |
|
Business reorganization |
|
Interest and other, net |
||||||||||||||
As reported |
$ |
151,492 |
|
$ |
145,160 |
|
$ |
23,281 |
|
$ |
713 |
|
$ |
18,479 |
|
||||||||
Net effect from deferral and related cost of goods sold |
|
812 |
|
||||||||||||||||||||
Stock-based compensation |
|
(27,143 |
) |
|
(17,206 |
) |
|||||||||||||||||
Amortization and impairment of acquired intangibles |
|
(3,106 |
) |
|
(244 |
) |
|||||||||||||||||
Impact of business reorganization |
|
(713 |
) |
||||||||||||||||||||
Acquisition related expenses |
|
(367 |
) |
||||||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP MEASURE | ||||||||
(in thousands) | ||||||||
Six months ended |
||||||||
|
2020 |
|
|
2019 |
|
|||
Net cash from operating activities |
$ |
626,745 |
|
$ |
144,158 |
|
||
Net change in Restricted cash related to Operations (1) |
|
(117,393 |
) |
|
(102,910 |
) |
||
Adjusted Unrestricted Operating Cash Flow |
$ |
509,352 |
|
$ |
41,248 |
|
||
FY 2021 | FY 2020 | |||||||
Restricted cash beginning of period (4/1) |
$ |
635,728 |
|
$ |
565,461 |
|
||
Less Restricted cash end of period (9/30) |
|
739,681 |
|
|
668,371 |
|
||
Less Restricted cash related to acquisitions |
|
13,440 |
|
|
- |
|
||
(1) Net change in Restricted cash realated to Operations |
$ |
(117,393 |
) |
($ |
102,910 |
) |
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20201105005964/en/
(Investor Relations)
Senior Vice President
Investor Relations & Corporate Communications
(646) 536-3005
[email protected]
(
Vice President
(646) 536-2983
[email protected]
Source: Take-Two Interactive