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    TTWO
    Earnings call· Mar 2026(Q4 FY26)

    TAKE TWO INTERACTIVE SOFTWARE Q4 FY26 earnings call TTWO

    May 21, 2026 Source

    Executive summary

    Take-Two Interactive Software Q4 FY26 — GTA VI Drives Record FY27 Outlook

    Take-Two concluded FY26 with strong performance across its portfolio, exceeding net bookings guidance. The company anticipates a "breakout year" in FY27, driven by the highly anticipated November 19 launch of Grand Theft Auto VI, which is expected to lead to record net bookings and over $1 billion in operating cash flow. Management plans to sustain this higher scale through a robust pipeline and strategic capital allocation.

    Highlights

    6

    • Q4 Net bookings reached $1.58 billion, exceeding the high end of guidance ($1.51B-$1.56B).

    • FY26 Net bookings totaled $6.7 billion, approximately $750 million above initial guidance.

    • NBA 2K delivered record net bookings and recurrent consumer spending, with 10 million units sold-in (5% increase over NBA 2K25) and RCS up 10% YoY in Q4.

    • Zynga achieved its highest level of net bookings since the 2022 acquisition.

    • FY27 outlook projects record net bookings of $8 billion to $8.2 billion, reflecting 20% growth, primarily driven by Grand Theft Auto VI.

    • Operating cash flow is expected to exceed $1 billion in FY27, with the company anticipating a net cash position by year-end.

    Concerns

    3

    • NBA 2K recurrent consumer spending in Q4, while strong, was softer than anticipated due to moderation from extreme growth in Q2 and Q3.

    • Mobile net bookings are expected to be down in FY27 due to assumed moderation for several of Zynga's mature mobile titles.

    • Overall recurrent consumer spending is forecast to be flat to FY26 in FY27.

    Guidance & targets

    20
    CategoryTargetConfidence
    Net bookings
    $8 billion to $8.2 billion
    high materiality
    High
    Operating cash flow
    in excess of $1 billion
    high materiality
    High
    Recurrent consumer spending (RCS)
    flat to fiscal 2026
    medium materiality
    Medium
    NBA 2K Recurrent consumer spending (RCS)
    up high single-digits
    medium materiality
    Medium
    Grand Theft Auto series Recurrent consumer spending (RCS)
    up
    medium materiality
    Medium
    Mobile Recurrent consumer spending (RCS)
    down
    medium materiality
    Medium
    Net bookings breakdown by label
    Rockstar Games 36%, Zynga 35%, 2K 29%
    medium materiality
    Medium
    GAAP net revenue
    $7.9 billion to $8.1 billion
    medium materiality
    High
    Cost of revenue
    $3.5 billion to $3.62 billion
    medium materiality
    High
    Total operating expenses
    $4.18 billion to $4.2 billion
    medium materiality
    High
    Operating expense growth (management basis)
    approximately 8% year-over-year
    medium materiality
    High
    Net bookings
    $1.32 billion to $1.37 billion
    medium materiality
    High
    Recurrent consumer spending (RCS)
    decline by approximately 3%
    medium materiality
    Medium
    NBA 2K Recurrent consumer spending (RCS)
    high single-digit growth
    medium materiality
    Medium
    Mobile Recurrent consumer spending (RCS)
    declines
    medium materiality
    Medium
    Grand Theft Auto series Recurrent consumer spending (RCS)
    declines
    medium materiality
    Medium
    GAAP net revenue
    $1.45 billion to $1.5 billion
    medium materiality
    High
    Cost of revenue
    $578 million to $594 million
    medium materiality
    High
    Operating expenses
    $926 million to $936 million
    medium materiality
    High
    Operating expense growth (management basis)
    approximately 3% year-over-year
    medium materiality
    High

    Operational metrics

    24
    Net bookings
    $1.58 billionabove guidance range of $1.51 billion to $1.56 billion
    Q4 FY26

    Exceeded the high end of the guidance range.

    Net bookings
    $6.72 billionabove guidance range of $6.65 billion to $6.7 billion
    FY26

    Exceeded the high end of the guidance range and approximately $750 million above initial guidance.

    Stock price low
    $195
    last 6 weeks

    Mentioned in the context of opportunistic share buybacks at deep value.

    AI marketing ad creation cost savings
    $25,000-$100,000
    per spot

    Cost of creating live-action ad units using AI, compared to previous third-party costs.

    Toon Blast growth
    25%year-over-year
    Q4 FY26

    Driven by new events and features introduced by Peak.

    Empires & Puzzles growth
    5%over last year
    Q4 FY26

    Driven by a robust slate of in-game events celebrating the title's ninth anniversary.

    Color Block Jam growth
    15%year-over-year
    Q4 FY26

    Remains the highest grossing title in Rollic's history.

    Grand Theft Auto series Recurrent Consumer Spending growth
    5%year-over-year
    Q4 FY26

    Driven by strong engagement in GTA Online, particularly A Safehouse in the Hills update.

    NBA 2K Recurrent Consumer Spending growth
    10%
    Q4 FY26

    Benefited from higher daily active users and games played per user, representing one of the strongest fourth quarters in franchise history.

    WWE 2K26 Recurrent Consumer Spending growth
    20%year-over-year
    Q4 FY26

    Engagement has been excellent.

    Recurrent Consumer Spending (Total) growth
    7%over last year
    Q4 FY26

    Strong growth, accounting for 82% of net bookings.

    Mobile Recurrent Consumer Spending growth
    7%year-over-year
    Q4 FY26

    Surpassed expectations.

    Recurrent Consumer Spending (Total) growth
    17%
    FY26

    Accounted for 78% of net bookings.

    NBA 2K growth
    30%
    FY26

    Sharply exceeded initial May guidance.

    Mobile growth
    13%
    FY26

    Sharply exceeded initial May guidance.

    Grand Theft Auto Online growth
    6%
    FY26

    Sharply exceeded initial May guidance.

    Operating expense growth (management basis)
    8%year-over-year
    FY27

    Represents significant leverage over fiscal 2026.

    Operating expense growth (management basis)
    3%year-over-year
    Q1 FY27

    Primarily driven by a modest increase in personnel costs.

    WWE SuperCard lifetime downloads
    39 million
    to-date

    Reached nearly 39 million lifetime downloads.

    NBA 2K All-Star China registered users
    10 million
    after 1 year

    Growing to nearly 10 million registered users after just 1 year in market.

    Pipeline titles
    29
    through FY29

    Includes 6 additional titles during FY27 and 22 titles throughout FY28 and FY29.

    Pipeline titles
    6
    FY27

    In addition to Grand Theft Auto VI.

    Pipeline titles
    22
    FY28-FY29

    Expected to be delivered throughout fiscal 2028 and 2029.

    Operating expenses (non-GAAP estimate)
    $3.8 billion$300 million incremental increase YoY
    FY27

    Analyst's estimate for non-GAAP operating expenses, confirmed by management, with about half of the incremental increase attributed to marketing.

    Industry KPIs

    1
    MetricValueDetails
    Content spend title performance230 million unitsunits

    Product announcements

    5
    ProductTypeDetails
    Grand Theft Auto VIlaunch
    Rockstar Mission Creatorupdate
    NBA 2K26 Season 5 (College-themed offering)update
    WWE 2K26 Ringside Passupdate
    PGA TOUR 2K25 Content Updatesupdate

    Deals & partnerships

    2
    Zyngaacquisition$9.7 billion in cash and stock

    Acquired in 2022, mentioned as a meaningful inorganic opportunity.

    Gearboxacquisition

    More recently acquired, mentioned as an inorganic opportunity.

    Risks & headwinds

    3
    Moderation of mature mobile titlesFY27

    Mobile net bookings expected to be down in FY27

    Mitigation: Implied focus on optimizing live services and new mobile releases, though not explicitly stated as a mitigation strategy.

    NBA 2K Recurrent Consumer Spending (RCS) moderationQ4 FY26

    Q4 FY26 NBA 2K RCS was softer than anticipated

    Mitigation: Applying successful learnings to the strategy for NBA 2K27, with Visual Concepts continuously innovating the game.

    Overall recurrent consumer spending flatnessFY27

    Expected to be flat to FY26 in FY27

    Mitigation: Not explicitly stated, but implied by robust pipeline and expansion opportunities across core franchises.

    Q&A highlights

    7

    How much of the $300 million incremental operating expense increase in FY27 is due to marketing, and what are the G&A/R&D trajectories?

    Lainie Goldstein stated that about half of the $300 million increase is for selling and marketing expenses across the entire pipeline, including GTA VI. She expects strong leverage over the next couple of years for G&A and R&D.

    “for the $300 million higher for this coming year, about half of that is for selling and marketing expenses for the entire company as we have significant marketing for our entire pipeline of titles that are coming out this year.”

    asked by Eric Handler · answered by Lainie Goldstein

    2 min read7 chapters

    Detailed Narrative

    01

    Fiscal Year 2026 Performance Highlights

    Take-Two concluded FY26 with strong results, including Q4 Net bookings of $1.58 billion, exceeding guidance. Full fiscal year Net bookings reached $6.7 billion, $750 million above initial forecasts. This performance was driven by record net bookings and recurrent consumer spending from NBA 2K, Zynga's highest net bookings since acquisition, and continued outperformance from the Grand Theft Auto series.

    02

    Grand Theft Auto VI Launch and FY27 Outlook

    The company anticipates FY27 to be a "breakout year" with the November 19 release of Grand Theft Auto VI. Rockstar Games will commence its marketing campaign this summer. The initial financial outlook for FY27 projects record net bookings of $8 billion to $8.2 billion, reflecting significant growth and an expectation to sustain this higher scale and generate strong cash flows.

    03

    Mobile Portfolio Strength

    Take-Two highlighted strong mobile performance, with Toon Blast growing 25% YoY, Match Factory! performing well, Empires & Puzzles growing 5% YoY, and Color Block Jam growing 15% YoY. Top Eleven achieved its strongest quarter ever. 2K's mobile offerings also contributed, with WWE SuperCard reaching 39 million lifetime downloads and NBA 2K All-Star in China reaching nearly 10 million registered users.

    04

    Direct-to-Consumer Channel Growth

    The direct-to-consumer channel continues to drive net bookings and margin growth by integrating mobile titles and enhancing user experience. This platform is seen as sustainable and growing, generating improvements in conversion and customer loyalty, and reducing payment friction. Management expressed confidence in its sustainability and growth profile as the regulatory landscape evolves.

    05

    Sports Titles Performance

    NBA 2K26 sold over 10 million units, a 5% increase over NBA 2K25, with recurrent consumer spending up 10%. WWE 2K26 was well-received, with RCS up 20% YoY and over 85 million matches played. PGA TOUR 2K25 saw a resurgence, with 60 million rounds played in Q4, a 110% increase over Q3, driven by aligning Season 5 with the PGA TOUR season and inclusion in PlayStation Plus.

    06

    Pipeline and Long-Term Growth

    The company has an upcoming pipeline of 29 titles through FY29, including 6 additional titles in FY27 (2 mobile, 3 sports, 1 platform extension). For FY28 and FY29, 22 titles are expected, comprising 1 mobile, 5 sports, 3 core new IPs, and 13 core existing IPs (7 sequels, 6 remakes/remasters/platform extensions). This robust pipeline is expected to drive long-term growth and returns for shareholders.

    07

    Capital Allocation Strategy

    Take-Two's capital allocation priorities remain consistent: supporting organic growth, selective and accretive inorganic opportunities (like the $9.7 billion Zynga acquisition), and returning capital to shareholders opportunistically through share buybacks when executed at deep value (e.g., last buyback at $158 per share). The company expects to be in a net cash position by the end of FY27, providing flexibility for future investments.

    AI-generated summary of the company’s earnings call. Not investment advice.