TTWO
$91.03
Take-Two Interacti
($.99)
(1.08%)
Earnings Details
1st Quarter June 2017
Wednesday, August 02, 2017 4:05:19 PM
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Summary

Take-Two Interacti Beats

Take-Two Interacti (TTWO) reported 1st Quarter June 2017 earnings of $0.63 per share on revenue of $418.2 million. The consensus earnings estimate was $0.19 per share on revenue of $287.1 million. The Earnings Whisper number was $0.25 per share. Revenue grew 34.2% on a year-over-year basis.

The company said it expects second quarter GAAP earnings of $0.15 to $0.25 per share on revenue of $400.0 million to $450.0 million. The current consensus earnings estimate is $0.39 per share on revenue of $407.9 million for the quarter ending September 30, 2017. The company also said it expects fiscal 2018 earnings of $1.00 to $1.25 per share on revenue of $1.62 billion to $1.72 billion. The current consensus earnings estimate is $1.09 per share on revenue of $1.55 billion for the year ending March 31, 2018.

Take-Two Interactive Software, Inc. is a developer, marketer and publisher of interactive entertainment for consumers around the globe. The Company develops and publishes products through its two wholly-owned labels Rockstar Games and 2K.

Results
Reported Earnings
$0.63
Earnings Whisper
$0.25
Consensus Estimate
$0.19
Reported Revenue
$418.2 Mil
Revenue Estimate
$287.1 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Take-Two Interactive Software, Inc. Reports Strong Results for Fiscal First Quarter 2018

GAAP Net income increased to $0.56 per diluted share

--Net Sales grew 28% to $348.3 million

Take-Two Interactive Software, Inc. (TTWO) today reported strong results for its fiscal first quarter 2018, ended June 30, 2017. In addition, the Company provided its initial financial outlook for its fiscal second quarter ending September 30, 2017, and updated its financial outlook for its fiscal year ending March 31, 2018.

Fiscal First Quarter 2018 GAAP Financial Highlights

Net revenue grew 34% to $418.2 million, as compared to $311.6 million in last year’s fiscal first quarter. The largest contributors to net revenue in fiscal first quarter 2018 were NBA(R) 2K17, Grand Theft Auto V(R) and Grand Theft Auto Online, WWE(R) 2K17 and WWE SuperCard, and Mafia III.

Digitally-delivered net revenue grew 56% to $268.2 million, as compared to $172.1 million in last year’s fiscal first quarter. Recurrent consumer spending (virtual currency, downloadable add-on content and microtransactions) grew 72% year-over-year and accounted for 63% of digitally-delivered net revenue, or 41% of total net revenue. The largest contributors to digitally-delivered net revenue in fiscal first quarter 2018 were Grand Theft Auto Online and Grand Theft Auto V, NBA 2K17, and WWE SuperCard and WWE 2K17.

Net income increased to $60.3 million, or $0.56 per diluted share, as compared to net loss of $38.6 million, or $0.46 per diluted share, for the comparable period last year.

As of June 30, 2017, the Company had cash and short-term investments of $1.281 billion.

The following data, together with a management reporting tax rate of 22%, are used internally by the Company’s management and Board of Directors to adjust the Company’s GAAP financial results in order to facilitate comparison of its operating performance between periods and to better understand its core business and future outlook:

Three Months Ended June 30, 2017
Financial Data
$ in thousands
Statement
Change in
Stock-based
Non-cash
Acquisition
Amortization
Business
of
deferred net
compensation
amounts
related
of intangible
reorganization
Operations
revenue and
related to
expenses
assets
excluding
related
convertible
stock-based
cost of
notes
compensation
goods sold
Net revenue
$ 418,216
(69,911 )
Cost of goods sold
194,569
(40,291 )
(3,481 )
(4,242 )
Gross profit
223,647
(29,620 )
3,481
4,242
Total operating expenses
173,428
(20,590 ) (1)
(18 )
(3,951 )
(8,178 )
Income from operations
50,219
(29,620 )
24,071
18
8,193
8,178
Interest and other, net
(2,808 )
4,134
Income before income taxes
47,411
(29,620 )
24,071
4,134
18
8,193
8,178
1) Includes $2,421 of stock-based compensation related to business
reorganization.

In order to calculate net income per diluted share for management reporting purposes, the Company uses its fully diluted share count of 118.8 million and adds back to net income the interest expense, net of tax, on the convertible notes of $0.4 million.

Operational Metric - Net Sales

Starting with fiscal first quarter 2018, Take-Two has replaced Bookings with Net Sales as an operational metric. The Company has made this change in order to increase transparency and to be consistent with operational metrics provided by its peers. Net Sales is defined as the net amount of products and services sold digitally or sold-in physically during the period. Unlike Bookings, Net Sales includes licensing fees, merchandise, in-game advertising, strategy guides and publisher incentives.

During fiscal first quarter 2018, total Net Sales grew 28% to $348.3 million, as compared to $272.6 million during last year’s fiscal first quarter. The largest contributors to Net Sales were Grand Theft Auto Online and Grand Theft Auto V, NBA 2K17, Dragon City and Monster Legends, WWE 2K17 and WWE SuperCard, Mafia III, and Sid Meier’s Civilization VI. Catalog accounted for $326.2 million of Net Sales led by Grand Theft Auto and NBA 2K. Digitally-delivered Net Sales grew 47% to $280.9 million, as compared to $191.2 million in last year’s fiscal first quarter, led by Grand Theft Auto Online and Grand Theft Auto V, NBA 2K17, Monster Legends and Dragon City, WWE SuperCard and WWE 2K17, and Mafia III. Net Sales from recurrent consumer spending grew 71% year-over-year and accounted for 72% of digitally-delivered Net Sales, or 58% of total Net Sales.

Management Comments

"Fiscal 2018 is off to an excellent start, with our business’s positive momentum continuing to exceed our expectations in the first quarter," said Strauss Zelnick, Chairman and CEO of Take-Two. "We delivered growth in both Net Sales and net revenue, as well as margin expansion. Our results were led by the ongoing extraordinary performance of Grand Theft Auto V and Grand Theft Auto Online, strong demand for NBA 2K17 - which is now our highest-selling sports title ever - and increased recurrent consumer spending.

"As a result of our stronger-than-expected first quarter operating results and improved outlook for the remainder of the year, we are increasing our fiscal 2018 outlook for Net Sales and net cash provided by operating activities. Looking ahead, we expect fiscal 2019 to be a record year for Net Sales and net cash provided by operating activities led by the launches of Rockstar Games’ Red Dead Redemption 2 and a highly anticipated new title from one of 2K’s biggest franchises. We have a robust development pipeline and are better positioned than ever for long-term growth and margin expansion."

Business and Product Highlights

Since April 1, 2017:

Take-Two:

Further diversified its industry-leading portfolio of owned intellectual property through the acquisition of Kerbal Space Program, the critically acclaimed physics-based space simulation game. Created by independent developer Squad, Kerbal Space Program was originally released on PC in April 2015* and has sold over two million units to date. The title has been widely popular with the media and consumers alike, earning a Metacritic rating of 88** and a Steam user score of 97%***. The Kerbal Space Program: Making History Expansion is planned to launch for PC later this calendar year.

*Game became available through Steam Early Access in March
2013, and launched in April 2015.
**Metacritic score for PC as of July 31, 2017.
***Steam user score as of July 31, 2017.

Rockstar Games:

Released new free content updates for Grand Theft Auto Online, including: -- Gunrunning, a massive update offering new opportunities in illegal weapons trafficking gameplay and featuring tactical, full-service Mobile Operation Centers complete with new weapon upgrades and deep customization, all new Weaponized Vehicles and much more.

Dawn Raid, a two-team race under the cover of darkness to track down highly coveted contraband involving parachutes, Night and Thermal Vision Goggles and the Trackify app to locate the correct package.

Overtime Rumble, a new team-based fan favorite mode that pits up to 10 players in a vehicular remix of Darts as players try to land the Ruiner 2000 on platforms of various sizes.

Power Mad, a point-based battle where players on each team fight for the right to control the minigun-toting Juggernaut.

Announced that Red Dead Redemption 2(R) is planned for release worldwide in spring 2018 (fiscal year 2019) for PlayStation(R)4 and Xbox One.

2K:

Released two downloadable add-on packs for Mafia III - Stones Unturned and Sign of the Times - which are available for individual purchase or as part of the title’s Season Pass.

Announced Seth Rollins as the cover Superstar for WWE 2K18, the next release from its flagship WWE video game franchise, which will launch on October 17, 2017 for PlayStation 4 and Xbox One. Players who purchase the WWE 2K18 Deluxe Edition or WWE 2K18 Collector’s Edition from participating retailers will receive Early Access to their game copies and in-game bonuses beginning four days early on October 13, 2017. In addition, WWE 2K18 will be released for Nintendo Switch(TM) during fall 2017, marking the first time in five years that a WWE game has been available on a Nintendo platform. The title will be supported with a series of post-launch content, including a Season Pass.

Announced that Cleveland Cavaliers point guard, Kyrie Irving, will be the cover athlete of NBA 2K18, the next iteration of its top-rated and top-selling NBA video game simulation series, which will launch on September 19, 2017 for PlayStation4, PlayStation3, Xbox One, Xbox 360, Nintendo Switch, and Windows PC platforms. In addition, Hall of Famer Shaquille O’Neal will be on the cover of the NBA 2K18 Legend Edition. This special edition will place a spotlight on "The Big Aristotle" with special Shaq-themed memorabilia and content, extending his legacy as the most dominant center in NBA history. NBA 2K18 will also debut the series’ first-ever Canadian cover, featuring Toronto Raptors’ shooting guard DeMar DeRozan.

Announced that XCOM(R) 2: War of the Chosen, the expansion pack for the 2016 award-winning strategy title from Firaxis Games, will be available for Windows PC, PlayStation 4 and Xbox One on August 29, 2017.

Financial Outlook for Fiscal 2018

Take-Two is providing its initial financial outlook for its fiscal second quarter ending September 30, 2017, and updating its financial outlook for its fiscal year ending March 31, 2018, as follows:

Second Quarter Ending September 30, 2017

-- GAAP net revenue is expected to range from $400 to $450 million

-- GAAP net income is expected to range from $17 to $27 million

GAAP diluted net income per share is expected to range from $0.15 to $0.25

Share count used to calculate GAAP diluted net income per share is expected to be 109.9 million (1)

Net Sales (operational metric) are expected to range from $465 to $515 million

The Company is also providing selected data and its management reporting tax rate of 22% that are used internally by its management and Board of Directors to adjust the Company’s GAAP financial outlook in order to facilitate comparison of its operating performance between periods and to better understand its core business and future outlook:

Three Months Ending September 30, 2017
Financial Data
$ in millions
GAAP
Change in
Stock-based
Non-cash
Amortization
outlook (2)
deferred net
compensation (3)
amounts related to
of intangible
revenue and
convertible
assets
related
notes
cost of
goods sold
Net revenue
$400 to $450
$65
Cost of goods sold
$194 to $222
$22
($8)
($4)
Operating Expenses
$185 to $195
($18)
($4)
Interest and other, net
$2
($3)
Income (loss) before income taxes
$19 to $31
$43
$26
$3
$8

Fiscal Year Ending March 31, 2018

As a result of its better-than-expected fiscal first quarter 2018 operating performance and improved outlook for the remainder of the fiscal year, Take-Two is increasing its fiscal year 2018 outlook for Net Sales and net cash provided by operating activities. In addition, due to the continued success of Grand Theft Auto Online and other factors, the Company has determined that it is necessary to extend the life of Grand Theft Auto V and Grand Theft Auto Online for purposes of calculating deferrals. As a result, and also due to higher expected internal royalties driven by the strong performance of Grand Theft Auto V and Grand Theft Auto Online, the Company is reducing its outlook for GAAP net revenue and GAAP net income.

-- GAAP net revenue is expected to range from $1.62 to $1.72 billion

-- GAAP net income is expected to range from $112 to $140 million

GAAP diluted net income per share is expected to range from $1.00 to $1.25

Share count used to calculate GAAP diluted net income per share is expected to be 111.8 million (4)

Net cash provided by operating activities is expected to be approximately $200 million

-- Capital expenditures are expected to be approximately $60 million

Net Sales (operational metric) are expected to range from $1.65 to $1.75 billion

The Company is also providing selected data and its management reporting tax rate of 22% that are used internally by its management and Board of Directors to adjust the Company’s GAAP financial outlook in order to facilitate comparison of its operating performance between periods and to better understand its core business and future outlook:

Twelve Months Ending March 31, 2018
Financial Data
$ in millions
GAAP
Change in
Stock-based
Non-cash
Amortization
Business
outlook (2)
deferred net
compensation (3)
amounts
of
reorganization
revenue and
related to
intangible assets
excluding
related
convertible
stock-based
cost of
notes
compensation
goods sold
Net revenue
$1,620 to $1,720
$30
Cost of goods sold
$732 to $781
($13 )
($21 )
($18 )
Operating Expenses
$770 to $790
($74 ) (5)
($16 )
($8 )
Interest and other, net
$9
($14 )
Income (loss) before income taxes
$109 to $141
$43
$95
$14
$34
$8
1)
For the fiscal second quarter ending September 30, 2017, the
Company’s fully diluted share count used for management reporting
purposes is expected to be 120.3 million, which includes 109.0
million basic shares, 0.9 million participating shares and 10.4
million shares representing the potential dilution from convertible
notes. The interest expense, net of tax, on the convertible notes,
which is added back to net income to calculate diluted net income
per share for management reporting purposes is $0.4 million.
Take-Two’s GAAP net income per diluted share outlook is calculated
using a diluted share count of 109.9 million (basic shares plus
participating shares), because using the "if-converted" method and
the Company’s fully diluted share count of 120.3 million would have
been anti-dilutive.
2)
The individual components of the financial outlook may not foot to
the totals as the Company does not expect actual results for every
component to be at the low end or high end of the outlook range
simultaneously.
3)
The Company’s stock-based compensation expense for the periods above
includes the cost of approximately 0.6 million restricted stock
units previously granted to ZelnickMedia that are subject to
variable accounting. Actual expense to be recorded in connection
with these shares is dependent upon several factors, including
future changes in Take-Two’s stock price.
4)
For the fiscal year ending March 31, 2018, the Company’s fully
diluted share count used for management reporting purposes is
expected to be 121.9 million, which includes 110.9 million basic
shares, 0.8 million participating shares and 10.2 million shares
representing the potential dilution from convertible notes. The
interest expense, net of tax, on the convertible notes, which is
added back to net income to calculate diluted net income per share
for management reporting purposes is $1.8 million. Take-Two’s GAAP
net income per diluted share outlook is calculated using a diluted
share count of 111.8 million (basic shares plus participating
shares), because using the "if-converted" method and the Company’s
fully diluted share count of 121.9 million would have been
anti-dilutive.
5)
Includes $2.4 million of stock-based compensation related to
business reorganization.

Key assumptions and dependencies underlying the Company’s financial outlook include: the timely delivery of the titles included in this financial outlook; continued consumer acceptance of the Xbox One and PlayStation 4; the ability to develop and publish products that capture market share for these new-generation systems while continuing to leverage opportunities on the Xbox 360, PlayStation 3 and PC; and stable foreign exchange rates. See also "Cautionary Note Regarding Forward Looking Statements" below.

Product Releases

The following titles were released since April 1, 2017:

Label
Title
Platforms
Release Date
2K
Mafia III: Stones Unturned (DLC)
PS4, Xbox One, PC
May 30, 2017
2K
Mafia III: Sign of the Times (DLC)
PS4, Xbox One, PC
July 25, 2017
Take-Two’s lineup of future titles announced to date includes:
Label
Title
Platforms
Release Date
2K
XCOM 2: War of the Chosen (DLC)
PS4, Xbox One, PC
August 29, 2017
2K
NBA 2K18
PS4, PS3, Xbox One, Xbox 360, Switch (digital), PC
September 19, 2017
2K
WWE 2K18
PS4, Xbox One
October 17, 2017
2K
NBA 2K18
Switch (physical)
Fall 2017
2K
WWE 2K18
Switch
Fall 2017
Take-Two
Kerbal Space Program: Making History Expansion
PC
Calendar 2017
Rockstar Games
Red Dead Redemption 2
PS4, Xbox One
Spring 2018

Conference Call

Take-Two will host a conference call today at 4:30 p.m. Eastern Time to review these results and discuss other topics. The call can be accessed by dialing (877) 407-0984 or (201) 689-8577. A live listen-only webcast of the call will be available by visiting http://ir.take2games.com and a replay will be available following the call at the same location.

Final Results

The financial results discussed herein are presented on a preliminary basis; final data will be included in Take-Two’s Quarterly Report on Form 10-Q for the period ended June 30, 2017.

About Take-Two Interactive Software

Headquartered in New York City, Take-Two Interactive Software, Inc. is a leading developer, publisher and marketer of interactive entertainment for consumers around the globe. The Company develops and publishes products principally through its two wholly-owned labels Rockstar Games and 2K. Our products are designed for console systems and personal computers, including smartphones and tablets, and are delivered through physical retail, digital download, online platforms and cloud streaming services. The Company’s common stock is publicly traded on NASDAQ under the symbol TTWO. For more corporate and product information please visit our website at http://www.take2games.com.

All trademarks and copyrights contained herein are the property of their respective holders.

Cautionary Note Regarding Forward-Looking Statements

The statements contained herein which are not historical facts are considered forward-looking statements under federal securities laws and may be identified by words such as "anticipates," "believes," "estimates," "expects," "intends," "plans," "potential," "predicts," "projects," "seeks," "should," "will," or words of similar meaning and include, but are not limited to, statements regarding the outlook for the Company’s future business and financial performance. Such forward-looking statements are based on the current beliefs of our management as well as assumptions made by and information currently available to them, which are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual outcomes and results may vary materially from these forward-looking statements based on a variety of risks and uncertainties including: our dependence on key management and product development personnel, our dependence on our Grand Theft Auto products and our ability to develop other hit titles, the timely release and significant market acceptance of our games, the ability to maintain acceptable pricing levels on our games, and risks associated with international operations. Other important factors and information are contained in the Company’s most recent Annual Report on Form 10-K, including the risks summarized in the section entitled "Risk Factors," the Company’s most recent Quarterly Report on Form 10-Q, and the Company’s other periodic filings with the SEC, which can be accessed at www.take2games.com. All forward-looking statements are qualified by these cautionary statements and apply only as of the date they are made. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three months ended June 30,
2017
2016
Net revenue
$ 418,216
$ 311,552
Cost of goods sold:
Internal royalties
77,704
59,673
Software development costs and royalties
43,629
63,659
Product costs
44,069
44,979
Licenses
29,167
23,069
Total cost of goods sold
194,569
191,380
Gross profit
223,647
120,172
General and administrative
60,603
46,743
Selling and marketing
52,214
71,134
Research and development
42,269
33,900
Business reorganization
10,599
-
Depreciation and amortization
7,743
7,378
Total operating expenses
173,428
159,155
Income (loss) from operations
50,219
(38,983 )
Interest and other, net
(2,808 )
(4,506 )
Gain on long-term investments, net
-
1,350
Income (loss) before income taxes
47,411
(42,139 )
Benefit from income taxes
12,865
3,572
Net income (loss)
$
60,276
$ (38,567 )
Earnings (loss) per share:
Basic earnings (loss) per share
$
0.57
$
(0.46 )
Diluted earnings (loss) per share
$
0.56
$
(0.46 )
Weighted average shares outstanding:
Basic
104,465
84,588
Diluted
117,753
84,588
Computation of Basic EPS:
Net income (loss)
$
60,276
$ (38,567 )
Less: net income allocated to participating securities
(588 )
-
Net loss for basic and diluted EPS calculation
$
59,688
$ (38,567 )
Weighted average shares outstanding - basic
105,494
84,588
Less: weighted average participating shares outstanding
(1,029 )
-
Weighted average common shares outstanding - basic
104,465
84,588
Basic earnings (loss) per share
$
0.57
$
(0.46 )
Computation of Diluted EPS:
Net income (loss)
$
60,276
$ (38,567 )
Less: net income allocated to participating securities
(522 )
-
Add: interest expense, net of tax, on Convertible Notes
5,750
-
Net income (loss) for diluted EPS calculation
$
65,504
$ (38,567 )
Weighted average common shares outstanding - basic
105,494
84,588
Add: dilutive effect of common stock equivalents
13,288
-
Total weighted average shares outstanding - diluted
118,782
84,588
Less: weighted average participating shares outstanding
(1,029 )
-
Weighted average common shares outstanding - diluted
117,753
84,588
Diluted earnings (loss) per share
$
0.56
$
(0.46 )
TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
June 30,
March 31,
2017
2017
ASSETS
Current assets:
Cash and cash equivalents
$
828,112
$
943,396
Short-term investments
452,949
448,932
Restricted cash
406,336
337,818
229,197
219,558
Accounts receivable, net of allowances of $52,262 and $66,483 at
June 30, 2017 and March 30, 2017, respectively
Inventory
11,636
16,323
Software development costs and licenses
20,181
41,721
Deferred cost of goods sold
79,902
127,901
Prepaid expenses and other
84,823
59,593
Total current assets
2,113,136
2,195,242
Fixed assets, net
76,613
67,300
Software development costs and licenses, net of current portion
462,877
381,910
Deferred cost of goods sold, net of current portion
17,021
-
Goodwill
369,622
359,115
Other intangibles, net
133,330
110,262
Other assets
46,971
35,325
Total assets
$ 3,219,570
$ 3,149,154
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
36,934
$
31,892
Accrued expenses and other current liabilities
809,685
750,875
Deferred revenue
619,439
903,125
Total current liabilities
1,466,058
1,685,892
Long-term debt
212,864
251,929
Non-current deferred revenue
231,526
10,406
Other long-term liabilities
209,367
197,199
Total liabilities
2,119,815
2,145,426
Stockholders’ equity:
Preferred stock, $.01 par value, 5,000 shares authorized
-
-
Common stock, $.01 par value, 200,000 shares authorized; 123,027 and
119,813 shares
issued and 105,835 and 102,621 outstanding at June 30, 2017 and
1,230
1,198
March 31, 2017, respectively
Additional paid-in capital
1,479,143
1,452,754
Treasury stock, at cost; 17,192 common shares at June 30, 2017 and
(303,388 )
(303,388 )
March 31, 2017, respectively
Accumulated deficit
(39,648 )
(99,694 )
Accumulated other comprehensive loss
(37,582 )
(47,142 )
Total stockholders’ equity
1,099,755
1,003,728
Total liabilities and stockholders’ equity
$ 3,219,570
$ 3,149,154
TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three months ended June 30,
2017
2016
Operating activities:
Net income (loss)
$
60,276
$ (38,567 )
Adjustments to reconcile net loss to net cash provided by operating
activities:
Amortization and impairment of software development costs and
18,206
41,034
licenses
Depreciation and amortization
7,743
7,378
Amortization and impairment of intellectual property
8,181
-
Stock-based compensation
24,071
15,100
Amortization of discount on Convertible Notes
5,237
6,098
Gain on conversions of Convertible Notes
(1,103 )
-
Amortization of debt issuance costs
188
381
Other, net
(9,669 )
(3,171 )
Changes in assets and liabilities:
Restricted cash
(68,518 )
(57,335 )
Accounts receivable
(9,294 )
28,226
Inventory
5,451
2,696
Software development costs and licenses
(71,829 )
(62,392 )
Prepaid expenses and other assets
(23,199 )
(3,867 )
Deferred revenue
(67,883 )
(36,446 )
Deferred cost of goods sold
32,233
17,223
Accounts payable, accrued expenses and other liabilities
71,281
36,394
Net cash used in operating activities
(18,628 )
(47,248 )
Investing activities:
Change in bank time deposits
(24,999 )
78,691
Proceeds from available-for-sale securities
45,705
29,795
Purchases of available-for-sale securities
(33,158 )
(30,836 )
Purchases of fixed assets
(16,092 )
(4,230 )
Purchases of commercial paper
(7,989 )
-
Proceeds from commercial paper
16,500
-
Proceeds from sale of long-term investments
-
1,350
Purchase of long-term investments
-
(1,885 )
Asset acquisition
(25,381 )
-
Net cash (used in) provided by investing activities
(45,415 )
72,885
Financing activities:
Excess tax benefit from stock-based compensation
-
887
Tax payment related to net share settlements on restricted stock
(57,689 )
(25,166 )
awards
Net cash used in financing activities
(57,689 )
(24,279 )
Effects of foreign exchange rates on cash and cash equivalents
6,448
(3,772 )
Net decrease in cash and cash equivalents
(115,284 )
(2,414 )
Cash and cash equivalents, beginning of year
943,396
798,742
Cash and cash equivalents, end of period
$
828,112
$ 796,328
TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES
Net Revenue and Net Sales by Geographic Region, Distribution
Channel, and Platform Mix
(in thousands)
Three Months Ended
Three Months Ended
June 30, 2017
June 30, 2016
Amount
% of Total
Amount
% of Total
Net revenue by geographic region
United States
$ 258,260
62 %
$ 193,101
62 %
International
159,956
38 %
118,451
38 %
Total net revenue
418,216
100 %
311,552
100 %
Net sales by geographic region
United States
$ 199,871
57 %
$ 143,240
53 %
International
148,434
43 %
129,316
47 %
Total net sales
$ 348,305
100 %
$ 272,556
100 %
Three Months Ended
Three Months Ended
June 30, 2017
June 30, 2016
Amount
% of Total
Amount
% of Total
Net revenue by distribution channel
Digital online
$ 268,235
64 %
$ 172,078
55 %
Physical retail and other
149,981
36 %
139,474
45 %
Total net revenue
418,216
100 %
311,552
100 %
Net sales by distribution channel
Digital online
$ 280,914
81 %
$ 191,164
70 %
Physical retail and other
67,391
19 %
81,392
30 %
Total net sales
$ 348,305
100 %
$ 272,556
100 %
Three Months Ended
Three Months Ended
June 30, 2017
June 30, 2016
Amount
% of Total
Amount
% of Total
Net revenue by platform mix
Console
$ 344,917
82 %
$ 254,026
82 %
PC and other
73,299
18 %
57,526
18 %
Total net revenue
418,216
100 %
311,552
100 %
Net sales by platform mix
Console
$ 265,750
76 %
$ 213,845
78 %
PC and other
82,555
24 %
58,711
22 %
Total net sales
$ 348,305
100 %
$ 272,556
100 %
TAKE-TWO INTERACTIVE SOFTWARE, INC. and SUBSIDIARIES
ADDITIONAL DATA
(in thousands)
Three Months Ended June 30, 2017
Net Revenue
Cost of Goods Sold-
Cost of Goods Sold-
Cost of Goods Sold-
Cost of Goods Sold-
General and
Internal Royalties
Software
Product Costs
Licenses
Administrative
Development
Costs
and Royalties
As reported
$ 418,216
$ 77,704
$ 43,629
$
44,069
$
29,167
$
60,603
Net effect from deferral and related cost of goods sold
(69,911 )
(7,654 )
(17,806 )
(14,831 )
Stock-based compensation
(3,481 )
(13,120 )
Amortization of intangibles
(4,242 )
Acquisition related expenses
(18 )
Three Months Ended June 30, 2017
Selling and
Research and
Business
Depreciation and
Interest and
Marketing
Development
Reorganization
Amortization
Other, net
As reported
$
52,214
$ 42,269
$ 10,599
$
7,743
$
(2,808 )
Stock-based compensation
(2,585 )
(2,464 )
(2,421 )
Non-cash amortization of discount on Convertible Notes
5,237
Non-cash (gain) loss on redemption of Convertible Notes
(1,103 )
Amortization of intangibles
(2,308 )
(1,523 )
(120 )
Impact of business reorganization
(8,178 )
Three Months Ended June 30, 2016
Net Revenue
Cost of Goods Sold-
Cost of Goods Sold-
Cost of Goods Sold-
Cost of Goods Sold-
General and
Internal Royalties
Software
Product Costs
Licenses
Administrative
Development
Costs
and Royalties
As reported
$ 311,552
$ 59,673
$ 63,659
$
44,979
$
23,069
$
46,743
Net effect from deferral and related cost of goods sold
(38,996 )
(2,727 )
(8,889 )
(13,007 )
(6,705 )
Stock-based compensation
(4,386 )
Three Months Ended June 30, 2016
Selling and
Research and
Depreciation and
Interest and Other, net
Gain on long-term
Marketing
Development
Amortization
investments
As reported
$
71,134
$ 33,900
$
7,378
$
(4,506 )
$
1,350
Stock-based compensation
(2,549 )
(1,459 )
Non-cash amortization of discount on Convertible Notes
6,099
Impact of business reorganization
Proceeds from sale of long-term investments
(1,350 )

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SOURCE: Take-Two Interactive

Take-Two Interactive Software, Inc.
Investor Relations:
Henry A. Diamond, 646-536-3005
Senior Vice President
Investor Relations & Corporate Communications
Henry.Diamond@take2games.com
or
Corporate Press:
Alan Lewis, 646-536-2983
Vice President
Corporate Communications & Public Affairs
Alan.Lewis@take2games.com