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1. Company Snapshot

1.a. Company Description

Take-Two Interactive Software, Inc.develops, publishes, and markets interactive entertainment solutions for consumers worldwide.The company offers its products under the Rockstar Games, 2K, Private Division, and T2 Mobile Games names.


It develops and publishes action/adventure products under the Grand Theft Auto, Max Payne, Midnight Club, and Red Dead Redemption names; and offers episodes and content, as well as develops brands in other genres, including the LA Noire, Bully, and Manhunt franchises.The company also publishes various entertainment properties across various platforms and a range of genres, such as shooter, action, role-playing, strategy, sports, and family/casual entertainment under the BioShock, Mafia, Sid Meier's Civilization, XCOM series, and Borderlands.In addition, it publishes sports simulation titles comprising NBA 2K series, a basketball video game; the WWE 2K professional wrestling series; and PGA TOUR 2K.


Further, the company offers Kerbal Space Program, OlliOlli World, and The Outer Worlds and Ancestors: the Humankind Odyssey under Private Division; and free-to-play mobile games, such as Dragon City, Monster Legends, Two Dots, and Top Eleven.Its products are designed for console gaming systems, including PlayStation 4 and PlayStation 5; Xbox One; the Nintendo's Switch; personal computers; and mobile comprising smartphones and tablets.The company provides its products through physical retail, digital download, online platforms, and cloud streaming services.


Take-Two Interactive Software, Inc.was incorporated in 1993 and is based in New York, New York.

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1.b. Last Insights on TTWO

Take-Two Interactive Software, Inc.'s recent performance was negatively impacted by its Q3 earnings release, which showed a narrower loss year-over-year, but missed estimates. Despite a 25% jump in GAAP revenues, the company's results were overshadowed by a 5-day losing streak, resulting in a significant decline in market capitalization. Investor sentiment was also affected by the sale of shares by BLB&B Advisors LLC and Cresset Asset Management LLC, while Strategy Asset Managers LLC and Penserra Capital Management LLC acquired or increased their stakes.

1.c. Company Highlights

2. Take-Two Interactive's Q3 FY2026 Earnings: A Strong Beat

Take-Two Interactive Software, Inc. reported a robust Q3 FY2026, with GAAP net revenue increasing 25% to $1.7 billion and EPS coming in at $1.23, significantly beating estimates of $0.833. The company's net bookings also surpassed expectations, reaching $1.76 billion. The strong financial performance was driven by the company's successful mobile business, with titles such as TuneBlast, Match Factory, and Empires and Puzzles seeing significant growth. The cost of revenue increased 26% to $754 million, while operating expenses rose 10% to $984 million.

Publication Date: Feb -04

📋 Highlights
  • Q3 Net Bookings Surpass Guidance: Recorded $1.76 billion, exceeding guidance by outperforming the high end.
  • Mobile Business Growth: TuneBlast grew 43% YoY, with mobile titles surpassing $3 billion in lifetime net bookings.
  • Recurrent Consumer Spending: Increased 23% for the quarter and 17% expected annually, representing 78% of net bookings.
  • Full-Year Revenue Outlook Raised: Anticipated net bookings of $6.65–$7 billion, 18% growth over fiscal 2025.
  • NBA 2K Engagement Surge: Engagement rose 30% YoY, driving monetization and franchise outperformance.

Segment Performance

The company's mobile business was a key driver of growth, with TuneBlast growing 43% year-over-year and surpassing $3 billion in lifetime net bookings. The Grand Theft Auto series and NBA 2K also outperformed expectations, with recurrent consumer spending growing 23% for the period. The company's labels are expected to contribute as follows: Zynga (46%), 2K (38%), and Rockstar Games (16%).

Outlook and Guidance

Take-Two Interactive raised its outlook for the full fiscal year, expecting net bookings to range from $6.65 billion to $7 billion, representing 18% growth compared to fiscal 2025. The company also updated its forecast for GAAP net revenue to range from $6.55 billion to $6.6 billion and operating cash flow to $450 million. Analysts estimate next year's revenue growth at 38.1%, indicating a strong outlook for the company's future prospects.

Valuation

Using the current valuation metrics, Take-Two Interactive's P/S Ratio stands at 6.3, while its EV/EBITDA is at -14.83. The company's ROE is -108.38%, and ROIC is -52.79%. These metrics suggest that the market is pricing in significant growth expectations, which is consistent with the company's strong outlook and guidance.

Future Prospects

The company is excited about its revised outlook for the rest of the year and its expectations for next year, including the release of WWE, NBA 2K, and GTA VI. CEO Strauss Zelnick expressed enthusiasm for the company's future prospects, citing the potential for generative AI to drive efficiencies and create new opportunities. The company's focus on creativity, efficiency, and innovation is expected to drive growth and create value for shareholders.

3. NewsRoom

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CBS and Zynga Bring Survivor Season 50 into The Hands of Fans with Partnership in Words With Friends, Zynga Poker, Two Dots, and More

Feb -18

Source: businesswire.com

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GTA 6 Momentum Builds: Saudi PIF Moves Take-Two Stake To Gaming Subsidiary Ahead Of 2026 Launch

Feb -17

Source: benzinga.com

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Saudi's Public Investment Fund dissolves stake in Take-Two Interactive

Feb -17

Source: reuters.com

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Take-Two Interactive Software, Inc. $TTWO Shares Bought by Cornerstone Investment Partners LLC

Feb -12

Source: defenseworld.net

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Stock Market Live February 10, 2026: S&P 500 (SPY) Down from Record Highs

Feb -10

Source: 247wallst.com

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Take-Two Interactive Software, Inc. $TTWO Shares Purchased by Penserra Capital Management LLC

Feb -06

Source: defenseworld.net

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Take-Two Misses Q3 Earnings Estimates, Raises FY26 Sales View

Feb -04

Source: zacks.com

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Take-Two Interactive raises 2026 guidance as Q3 bookings surge

Feb -04

Source: proactiveinvestors.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.00%)

6. Segments

Publishing

Expected Growth: 11.0%

The 11.0% growth in Take-Two Interactive Software, Inc.'s publishing segment is driven by strong sales of Grand Theft Auto and Red Dead Redemption titles, increased digital sales, and a growing player base in the gaming industry, fueled by innovative game development and strategic marketing efforts.

7. Detailed Products

Grand Theft Auto

An open-world action-adventure game series that allows players to explore and interact with virtual worlds, completing missions and engaging in various activities.

Red Dead Redemption

An open-world western-themed game series that allows players to explore the American West, complete quests, and engage in activities such as hunting and gunfights.

NBA 2K

A basketball simulation game series that allows players to manage and play as their favorite basketball teams, complete with realistic graphics and gameplay.

Borderlands

A first-person shooter game series with RPG elements that allows players to explore post-apocalyptic worlds, complete quests, and engage in cooperative play.

L.A. Noire

An open-world detective game that allows players to investigate crimes, interview witnesses, and solve puzzles in 1940s Los Angeles.

Max Payne

A third-person shooter game series that allows players to control a detective as he navigates a gritty, crime-ridden world, completing quests and engaging in action sequences.

Manhunt

A stealth-based game that allows players to control a prisoner forced to participate in a reality TV show, completing quests and avoiding detection.

Take-Two's Private Division

A publishing label focused on supporting and developing games from independent studios, including titles such as Kerbal Space Program and OlliOlli.

8. Take-Two Interactive Software, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Take-Two Interactive Software, Inc. operates in the video game industry, which has a moderate threat of substitutes. While there are alternative forms of entertainment, such as movies and sports, the company's flagship franchises like Grand Theft Auto and Red Dead Redemption have a loyal customer base, reducing the likelihood of customers switching to substitutes.

Bargaining Power Of Customers

The bargaining power of customers in the video game industry is relatively low. Take-Two's customers are primarily gamers who are loyal to specific franchises and are willing to pay a premium for new releases. The company also has a strong brand reputation and a wide distribution network, which reduces the bargaining power of individual customers.

Bargaining Power Of Suppliers

The bargaining power of suppliers in the video game industry is relatively low. Take-Two has a diverse range of suppliers, including game developers, publishers, and distributors. The company also has a strong financial position, which allows it to negotiate favorable terms with its suppliers.

Threat Of New Entrants

The threat of new entrants in the video game industry is relatively low. The industry has high barriers to entry, including significant investment requirements, complex game development processes, and established brand relationships. Take-Two's strong market position and brand recognition further reduce the threat of new entrants.

Intensity Of Rivalry

The intensity of rivalry in the video game industry is high. Take-Two competes with established players like Activision Blizzard, Electronic Arts, and Ubisoft, as well as new entrants and smaller developers. The industry is highly competitive, with companies competing on factors like game quality, innovation, and marketing. Take-Two's strong market position and flagship franchises help it compete effectively, but the rivalry remains intense.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 38.41%
Debt Cost 4.30%
Equity Weight 61.59%
Equity Cost 9.59%
WACC 7.56%
Leverage 62.35%

11. Quality Control: Take-Two Interactive Software, Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Amphenol

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A-Score: 5.0/10

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Quality: 9.2

Yield: 0.0

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Take-Two Interactive

A-Score: 4.3/10

Value: 4.2

Growth: 1.7

Quality: 3.1

Yield: 0.0

Momentum: 9.0

Volatility: 7.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

199.72$

Current Price

199.72$

Potential

-0.00%

Expected Cash-Flows