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Why Is Take-Two (TTWO) Down 1% Since Last Earnings Report?
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A month has gone by since the last earnings report for Take-Two Interactive (TTWO - Free Report) . Shares have lost about 1% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Take-Two due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Take-Two Reports Loss in Q1 Earnings, Revenues Up Y/Y
Take-Two Interactive Software 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.
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.
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.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -28.07% due to these changes.
VGM Scores
Currently, Take-Two has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Take-Two has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Take-Two is part of the Zacks Toys - Games - Hobbies industry. Over the past month, Jakks Pacific (JAKK - Free Report) , a stock from the same industry, has gained 11.5%. The company reported its results for the quarter ended June 2022 more than a month ago.
Jakks reported revenues of $220.42 million in the last reported quarter, representing a year-over-year change of +96.2%. EPS of $2.10 for the same period compares with -$0.38 a year ago.
Jakks is expected to post earnings of $3.81 per share for the current quarter, representing a year-over-year change of +1.3%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.1%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Jakks. Also, the stock has a VGM Score of A.
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Why Is Take-Two (TTWO) Down 1% Since Last Earnings Report?
A month has gone by since the last earnings report for Take-Two Interactive (TTWO - Free Report) . Shares have lost about 1% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Take-Two due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Take-Two Reports Loss in Q1 Earnings, Revenues Up Y/Y
Take-Two Interactive Software 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.
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.
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.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -28.07% due to these changes.
VGM Scores
Currently, Take-Two has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Take-Two has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Take-Two is part of the Zacks Toys - Games - Hobbies industry. Over the past month, Jakks Pacific (JAKK - Free Report) , a stock from the same industry, has gained 11.5%. The company reported its results for the quarter ended June 2022 more than a month ago.
Jakks reported revenues of $220.42 million in the last reported quarter, representing a year-over-year change of +96.2%. EPS of $2.10 for the same period compares with -$0.38 a year ago.
Jakks is expected to post earnings of $3.81 per share for the current quarter, representing a year-over-year change of +1.3%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.1%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Jakks. Also, the stock has a VGM Score of A.