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Take-Two Q4 Earnings Beat on Strong Revenue & Margin Growth
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Key Takeaways
TTWO topped Q4 sales estimates as GAAP net revenues rose 6.1% YoY to $1.68B.
Take-Two expanded gross margin to 55.9% as operating income returned to positive territory.
TTWO guided FY27 Net Bookings to $8.0B-$8.2B with cash flow above $1B.
Take-Two Interactive Software (TTWO - Free Report) posted a fourth-quarter fiscal 2026 GAAP net loss of 32 cents per share, narrower than a loss of $21.08 reported in the year-ago quarter.
TTWO reported adjusted earnings of 80 cents per share, down 26.6% year over year, but surpassed the Zacks Consensus Estimate by 42.86%.
GAAP net revenues increased 6.1% year over year to $1.68 billion and beat the Zacks Consensus Estimate of $1.55 billion. The largest contributors to GAAP net revenues included NBA 2K26 and NBA 2K25, Grand Theft Auto Online and Grand Theft Auto V, Toon Blast, Empires & Puzzles, Match Factory!, Color Block Jam, Red Dead Redemption 2 and Red Dead Online, Words With Friends, Borderlands 4 and WWE 2K26. The quarter again highlighted the breadth of Take-Two’s portfolio across console, PC and mobile.
Revenues from the United States increased 4.8% year over year to $991.7 million and accounted for 59% of GAAP net revenues. The rest came from international revenues, which rose 8.1% year over year to $688.1 million.
Take-Two Interactive Software, Inc. Price, Consensus and EPS Surprise
Game revenues increased 6.4% year over year to $1.57 billion and accounted for 93.4% of total revenues. The rest came from advertising revenues, which rose 2.5% year over year to $111.4 million, representing the remaining 6.6%.
Net Bookings were essentially flat year over year at $1.58 billion. Bookings from the United States decreased 3.0% year over year to $932.7 million, accounting for 59% of total Net Bookings. The rest came from international bookings, which increased 4.4% year over year to $647.6 million.
TTWO's Q4 Details
Recurrent consumer spending grew 7% year over year for the period and accounted for 82% of total Net Bookings.
In terms of distribution channels, Digital online revenues increased 7.2% year over year to $1.64 billion and represented 97.4% of GAAP net revenues. Physical retail and other revenues decreased 22.1% year over year to $44.3 million and accounted for the remaining 2.6% of GAAP net revenues. Digital online net bookings edged up 0.8% year over year to $1.54 billion and comprised 97.5% of net bookings, while Physical retail and other net bookings fell 24.2% year over year to $40.0 million, representing 2.5% of net bookings.
In terms of platform, mobile, console, and PC and other contributed 50.2%, 40.2% and 9.6% of GAAP net revenues, respectively. Mobile revenues rose 12.9% year over year to $843.9 million, while console revenues increased 14.1% to $674.6 million. PC and other revenues declined 33.8% year over year to $161.3 million.
On the bookings side, mobile, console, and PC and other represented 52.5%, 38.1% and 9.4% of net bookings, respectively. Mobile net bookings climbed 13.6% year over year to $829.1 million, console net bookings were essentially flat (up 0.1%) at $602.1 million, and PC and other net bookings decreased 40.3% year over year to $149.1 million.
Take-Two Highlights Engagement Across Core Franchises
Management emphasized that live services and add-on monetization remained a primary driver of performance. The company pointed to growth in NBA 2K’s recurrent spending, continued expansion in mobile and ongoing strength in Grand Theft Auto Online during the quarter.
This mix matters for investors because it can reduce reliance on one-off releases and extend the earnings power of established franchises. With live services contributing a large share of bookings and revenues, engagement levels across NBA 2K, Grand Theft Auto and mobile titles remain a key near-term swing factor.
TTWO’s Q4 Operating Details
Take-Two's GAAP gross profit rose 16.9% year over year to $938.7 million. Gross margin expanded to 55.9% from 50.8% in the year-ago quarter.
Total operating expenses were $927.8 million, down sharply from $4.58 billion in the year-ago quarter. The prior-year period included a $3.55 billion goodwill impairment.
Selling expenses decreased 2.5% year over year to $392.2 million. General and administrative expenses declined 2.8% year over year to $223.8 million. Research & development expenses decreased 11.9% year over year to $262.5 million. Business reorganization expenses decreased significantly to $0.9 million from $17.1 million in the year-ago quarter.
Operating income was $10.9 million compared with the year-ago quarter's operating loss of $3.78 billion, representing a significant improvement.
Balance Sheet & Cash Flow Details
As of March 31, 2026, TTWO has cash and cash equivalents of approximately $1.55 billion compared with $2.16 billion as of Dec. 31, 2025. The company also had short-term investments of $443.8 million. It had total debt of $2.79 billion as of Dec. 31, 2025 (consisting of $30 million in short-term debt and $2.49 billion in long-term debt).
For fiscal 2026, net cash provided by operating activities was $624.3 million, a significant improvement from the operating cash outflow of $45.2 million in fiscal 2025. Capital expenditures for fiscal 2026 were $163 million, while the company expects approximately $200 million in capital expenditures for fiscal 2027.
TTWO's Q1 & FY27 Guidance
For the first quarter of fiscal 2027, management expects Net Bookings of $1.32-$1.37 billion and GAAP total net revenues of $1.45-$1.50 billion. The company also forecast a GAAP net loss per share between 23 cents and 15 cents, alongside expected EBITDA of $155-$179 million, reflecting continued investment as it positions its pipeline for the remainder of the year.
Take-Two introduced initial fiscal 2027 Net Bookings guidance of $8.0-$8.2 billion, implying a step up from fiscal 2026. The company also guided to GAAP total net revenues of $7.9-$8.1 billion and GAAP diluted net income per share of 55 to 75 cents for the year ending March 31, 2027.
The company projects operating cash flow to exceed $1 billion in fiscal 2027, with capital expenditures expected to be approximately $200 million.
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Take-Two Q4 Earnings Beat on Strong Revenue & Margin Growth
Key Takeaways
Take-Two Interactive Software (TTWO - Free Report) posted a fourth-quarter fiscal 2026 GAAP net loss of 32 cents per share, narrower than a loss of $21.08 reported in the year-ago quarter.
TTWO reported adjusted earnings of 80 cents per share, down 26.6% year over year, but surpassed the Zacks Consensus Estimate by 42.86%.
GAAP net revenues increased 6.1% year over year to $1.68 billion and beat the Zacks Consensus Estimate of $1.55 billion. The largest contributors to GAAP net revenues included NBA 2K26 and NBA 2K25, Grand Theft Auto Online and Grand Theft Auto V, Toon Blast, Empires & Puzzles, Match Factory!, Color Block Jam, Red Dead Redemption 2 and Red Dead Online, Words With Friends, Borderlands 4 and WWE 2K26. The quarter again highlighted the breadth of Take-Two’s portfolio across console, PC and mobile.
Revenues from the United States increased 4.8% year over year to $991.7 million and accounted for 59% of GAAP net revenues. The rest came from international revenues, which rose 8.1% year over year to $688.1 million.
Take-Two Interactive Software, Inc. Price, Consensus and EPS Surprise
Take-Two Interactive Software, Inc. price-consensus-eps-surprise-chart | Take-Two Interactive Software, Inc. Quote
Game revenues increased 6.4% year over year to $1.57 billion and accounted for 93.4% of total revenues. The rest came from advertising revenues, which rose 2.5% year over year to $111.4 million, representing the remaining 6.6%.
Net Bookings were essentially flat year over year at $1.58 billion. Bookings from the United States decreased 3.0% year over year to $932.7 million, accounting for 59% of total Net Bookings. The rest came from international bookings, which increased 4.4% year over year to $647.6 million.
TTWO's Q4 Details
Recurrent consumer spending grew 7% year over year for the period and accounted for 82% of total Net Bookings.
In terms of distribution channels, Digital online revenues increased 7.2% year over year to $1.64 billion and represented 97.4% of GAAP net revenues. Physical retail and other revenues decreased 22.1% year over year to $44.3 million and accounted for the remaining 2.6% of GAAP net revenues. Digital online net bookings edged up 0.8% year over year to $1.54 billion and comprised 97.5% of net bookings, while Physical retail and other net bookings fell 24.2% year over year to $40.0 million, representing 2.5% of net bookings.
In terms of platform, mobile, console, and PC and other contributed 50.2%, 40.2% and 9.6% of GAAP net revenues, respectively. Mobile revenues rose 12.9% year over year to $843.9 million, while console revenues increased 14.1% to $674.6 million. PC and other revenues declined 33.8% year over year to $161.3 million.
On the bookings side, mobile, console, and PC and other represented 52.5%, 38.1% and 9.4% of net bookings, respectively. Mobile net bookings climbed 13.6% year over year to $829.1 million, console net bookings were essentially flat (up 0.1%) at $602.1 million, and PC and other net bookings decreased 40.3% year over year to $149.1 million.
Take-Two Highlights Engagement Across Core Franchises
Management emphasized that live services and add-on monetization remained a primary driver of performance. The company pointed to growth in NBA 2K’s recurrent spending, continued expansion in mobile and ongoing strength in Grand Theft Auto Online during the quarter.
This mix matters for investors because it can reduce reliance on one-off releases and extend the earnings power of established franchises. With live services contributing a large share of bookings and revenues, engagement levels across NBA 2K, Grand Theft Auto and mobile titles remain a key near-term swing factor.
TTWO’s Q4 Operating Details
Take-Two's GAAP gross profit rose 16.9% year over year to $938.7 million. Gross margin expanded to 55.9% from 50.8% in the year-ago quarter.
Total operating expenses were $927.8 million, down sharply from $4.58 billion in the year-ago quarter. The prior-year period included a $3.55 billion goodwill impairment.
Selling expenses decreased 2.5% year over year to $392.2 million. General and administrative expenses declined 2.8% year over year to $223.8 million. Research & development expenses decreased 11.9% year over year to $262.5 million. Business reorganization expenses decreased significantly to $0.9 million from $17.1 million in the year-ago quarter.
Operating income was $10.9 million compared with the year-ago quarter's operating loss of $3.78 billion, representing a significant improvement.
Balance Sheet & Cash Flow Details
As of March 31, 2026, TTWO has cash and cash equivalents of approximately $1.55 billion compared with $2.16 billion as of Dec. 31, 2025. The company also had short-term investments of $443.8 million. It had total debt of $2.79 billion as of Dec. 31, 2025 (consisting of $30 million in short-term debt and $2.49 billion in long-term debt).
For fiscal 2026, net cash provided by operating activities was $624.3 million, a significant improvement from the operating cash outflow of $45.2 million in fiscal 2025. Capital expenditures for fiscal 2026 were $163 million, while the company expects approximately $200 million in capital expenditures for fiscal 2027.
TTWO's Q1 & FY27 Guidance
For the first quarter of fiscal 2027, management expects Net Bookings of $1.32-$1.37 billion and GAAP total net revenues of $1.45-$1.50 billion. The company also forecast a GAAP net loss per share between 23 cents and 15 cents, alongside expected EBITDA of $155-$179 million, reflecting continued investment as it positions its pipeline for the remainder of the year.
Take-Two introduced initial fiscal 2027 Net Bookings guidance of $8.0-$8.2 billion, implying a step up from fiscal 2026. The company also guided to GAAP total net revenues of $7.9-$8.1 billion and GAAP diluted net income per share of 55 to 75 cents for the year ending March 31, 2027.
The company projects operating cash flow to exceed $1 billion in fiscal 2027, with capital expenditures expected to be approximately $200 million.
Take-Two’s Zacks Rank & Other Stocks to Consider
Currently, TTWO carries a Zacks Rank #2 (Buy).
Alto Ingredients (ALTO - Free Report) , Codere Online Luxembourg (CDRO - Free Report) and Hasbro (HAS - Free Report) are some other top-ranked stocks that investors can consider in the broader Zacks Consumer Discretionary sector. While Alto Ingredients currently sports a Zacks Rank #1 (Strong Buy), Codere Online Luxembourg and Hasbro carry a Zacks Rank #2 each. You can see the complete list of today’s Zacks #1 Rank stocks here.
Alto Ingredients’ shares have jumped 58% year to date. ALTO’s long-term earnings growth rate is projected at 53.7%.
Codere Online Luxembourg’s shares have gained 17.3% year to date. CDRO’s long-term earnings growth rate is projected at 10.53%.
Hasbro shares have returned 9.8% year to date. HAS’ long-term earnings growth rate is projected at 8.53%.