Take-Two Interactive Software (TTWO) Q1 2025 earnings summary

Executive summary

• Q1 FY2025 net bookings reached $1.22 billion, up 1% year-over-year and in line with guidance, with GAAP net revenue at $1.34 billion, driven by mobile and digital channels.

• Net loss widened to $262 million, impacted by reorganization and acquisition costs, and Turkish Lira devaluation.

• Major franchises like Grand Theft Auto, NBA 2K, and Red Dead Redemption continued to drive engagement and sales, with new launches including TopSpin 2K25, NFL 2K Playmakers, and Star Wars: Hunters.

• The acquisition of Gearbox Entertainment for $440.7 million expands the development portfolio and growth opportunities.

• A cost reduction program was implemented, incurring $49.5 million in reorganization expenses.

Financial highlights

• Q1 GAAP net revenue: $1.34 billion (+4% YoY); net loss: $262 million ($1.52 per share); EBITDA: $24.9 million (down from $64.5 million YoY).

• Net Bookings: $1.22 billion (up 1.4% YoY); 83% of bookings were digital.

• Mobile revenue rose to $722.5 million (54% of total); digital online revenue accounted for 97% of net revenue.

• Operating expenses increased 8% to $956 million, mainly due to higher marketing and reorganization costs.

• Adjusted unrestricted operating cash flow was $(232.8) million; net cash from operating activities for Q1: $35 million.

Outlook and guidance

• FY2025 net bookings outlook reiterated at $5.55–$5.65 billion, with net revenue guidance of $5.57–$5.67 billion and net loss projected at $757–$690 million.

• FY25 EBITDA outlook is $365–$420 million; operating expenses expected at $3.7–$3.72 billion.

• Q2 FY25 net bookings projected at $1.42–$1.47 billion; net revenue guidance is $1.29–$1.34 billion; net loss $400–$373 million.

• Management anticipates sequential net bookings growth in FY26 and FY27 as new titles launch.

• Recurrent consumer spending forecasted to grow ~3%, with mobile up high single digits and declines in hyper-casual and Empires & Puzzles.