NEW YORK--(BUSINESS WIRE)--Take-Two Interactive Software, Inc. (NASDAQ:TTWO) today reported strong financial results for fiscal third quarter 2015, ended December 31, 2014. In addition, the Company increased its financial outlook for the fiscal year ending March 31, 2015, and provided its initial financial outlook for the fiscal fourth quarter ending March 31, 2015.
Take-Twos positive momentum was demonstrated once again, as we delivered exceedingly strong third quarter revenues and profits, and finished the quarter with nearly $1 billion in cash and short term investments
GAAP Financial Results
For fiscal third quarter 2015, GAAP net revenue was $531.1 million, as compared to $1.86 billion for fiscal third quarter 2014. GAAP net income was $40.1 million, or $0.42 per diluted share, as compared to $578.4 million, or $4.69 per diluted share, for the year-ago period. GAAP net revenue and net income declined year-over-year in fiscal third quarter 2015 because GAAP results for fiscal third quarter 2014 included net revenue and cost of goods sold related to sell-in of the Grand Theft Auto V® game during both fiscal second quarter and fiscal third quarter 2014, as Grand Theft Auto Online launched during fiscal third quarter 2014. In addition, GAAP results for fiscal third quarter 2015 reflect the deferral of net revenue and cost of goods sold related to sell-in of Grand Theft Auto V during the quarter.
During fiscal third quarter 2015, the Companys cash and short-term investments balance increased to $976.6 million as of December 31, 2014.
Non-GAAP Financial Results
For fiscal third quarter 2015, Non-GAAP net revenue grew to $954.0 million, as compared to $767.7 million for the year-ago period. Non-GAAP net income increased to $211.6 million, or $1.87 per diluted share, as compared to $210.7 million, or $1.70 per diluted share, for the year-ago period.
The largest contributors to Non-GAAP net revenue in fiscal third quarter 2015 were Grand Theft Auto V and Grand Theft Auto Online, NBA® 2K15, WWE® 2K15, Borderlands®: The Pre-Sequel, and Sid Meiers Civilization®: Beyond Earth.
Non-GAAP net revenue from digitally-delivered content grew 64% year-over-year to $217.2 million. The largest contributors were offerings for the Grand Theft Auto series, NBA 2K15, the Borderlands franchise, and Sid Meiers Civilization: Beyond Earth. Revenue from recurrent consumer spending (virtual currency, downloadable add-on content and online games) grew 23% year-over-year and accounted for 36% of Non-GAAP net revenue from digitally-delivered content. Catalog sales accounted for $103.7 million of Non-GAAP net revenue led by the Grand Theft Auto series and offerings for Borderlands 2.
Management Comments
Take-Twos positive momentum was demonstrated once again, as we delivered exceedingly strong third quarter revenues and profits, and finished the quarter with nearly $1 billion in cash and short term investments, said Strauss Zelnick, Chairman and CEO of Take-Two. We successfully launched one of the most diverse holiday lineups in the Companys history, led by Grand Theft Auto V for PlayStation 4 and Xbox One, NBA 2K15, WWE 2K15, Borderlands: The Pre-Sequel and Sid Meiers Civilization: Beyond Earth. We also generated substantial growth in digitally-delivered revenue, including through our ongoing focus on offerings that drive recurrent consumer spending. As a result of Take-Twos outstanding holiday season performance, we are raising the Companys financial outlook for the full year.
Looking ahead, we expect that our fourth quarter will provide a strong finish to fiscal 2015, which is lining up to be one of Take-Twos best years ever. Anchored by the eagerly-anticipated launches of Evolve and Grand Theft Auto V for PC, along with an array of other offerings, we will continue to deliver titles that captivate audiences around the world and set benchmarks for excellence. With our world-class creative teams, robust development pipeline, cutting-edge technology and ample capital resources, Take-Two is superbly positioned to build on its solid foundation and continue to capitalize on this dynamic entertainment market.
Business and Product Highlights
Since October 1, 2014:
Rockstar Games:
Launched Grand Theft Auto V and Grand Theft Auto Online on PlayStation®4 and Xbox One. Grand Theft Auto V is the highest-rated game to date for PlayStation 4 and Xbox One*, and has now sold-in more than 45 million units on console, including nearly 10 million units on PlayStation 4 and Xbox One. The title is planned for launch on PC on March 24, 2015.
Released two updates for Grand Theft Auto Online, including The Last Team Standing Update and the Festive Surprise.
Released the portable classic Grand Theft Auto: Chinatown Wars for Android and Amazon Kindle Fire, and updated the game for iOS. This updated version features new highly customizable touchscreen controls, physical controller support, plus high resolution widescreen display on supported devices, as well as full Retina Display resolution on iOS.
Announced that Grand Theft Auto Online Heists a four-player co-op mode for Grand Theft Auto Online that enables players to plan, prepare and execute multi-tiered Heists across Los Santos and Blaine County will be coming in early 2015 as a free update on PlayStation 4, PlayStation 3, Xbox One, Xbox 360 and PC.
2K:
Launched NBA 2K15 on PlayStation 4, PlayStation 3, Xbox One, Xbox 360 and PC, as well as on iOS and Amazon devices. The title is the highest-rated sports game of 2014 across consoles and PC*, and has continued the series trend of year-over-year growth with approximately 5.5 million units sold-in to date.
Launched WWE 2K15 on the Xbox One, Xbox 360, PlayStation 4 and PlayStation 3. Developed collaboratively by Yuke's and Visual Concepts, WWE 2K15 is being supported with downloadable add-on content, including a Season Pass.
Released Borderlands: The Pre-Sequel on the Xbox 360, PlayStation 3 and PC. Co-developed by Gearbox Software and 2K Australia, the title is being supported with downloadable add-on content, including a Season Pass.
Launched Sid Meiers Civilization: Beyond Earth for PC, Mac and Linux. Developed by Firaxis Games, Sid Meiers Civilization: Beyond Earth is a new stand-alone, science fiction-themed entry in the award-winning Civilization franchise, which has sold-in more than 29 million units worldwide.
Released BioShock® Infinite: The Complete Edition for Xbox 360 and PlayStation 3, which includes the award-winning title and all of its previously-released add-on content.
Expanded its offerings for tablets and smartphones with the releases of Evolve: Hunters Quest, MyNBA 2K15, and NHL® 2K.
Announced that Borderlands: The Handsome Collection is planned for launch on PlayStation 4 and Xbox One on March 24, 2015. The Handsome Collection brings the critically-acclaimed Borderlands series to next-gen consoles for the first time and offers the complete story of the franchises most iconic villain, Handsome Jack. The Handsome Collection includes Borderlands 2 and Borderlands: The Pre-Sequel along with all of the downloadable content for both titles currently over $100 of value on prior-gen consoles, but now for only $59.99 and with the graphical fidelity of next-gen consoles, four-player split-screen on a single television, and the ability to transfer save files to the next-gen consoles with new cross-save functionality.**
Announced downloadable content details for Evolve, including a Hunting Season Pass, a fourth playable monster, Behemoth, and more. Developed by Turtle Rock Studios and planned for global launch on Xbox One, PlayStation 4 and PC on February 10, 2015, Evolve is the only game in history to earn both the official Electronic Entertainment Expo and Gamescom Game of Show awards in the same year.
Announced that Sid Meiers Starships is planned for launch on PC, Mac and iPad in spring 2015. This turn-based, tactical space combat game will feature cross-connectivity and unlockable bonuses with Sid Meiers Civilization: Beyond Earth.
Announced the formation of Hangar 13, a new development studio led by veteran game developer Haden Blackman. Hangar 13 is located at 2Ks headquarters in the San Francisco Bay Area and is working on an unannounced next-gen title.
* According to Metacritic.com.
** Save transfers must be between the same console family (e.g., Xbox 360 to Xbox One).
Financial Outlook for Fiscal 2015
Take-Two is increasing its financial outlook for fiscal year 2015, which reflects its strong fiscal third quarter results, strong current business trends, and positive sales outlook for its upcoming releases. In addition, the Company is providing its initial financial outlook for its fiscal fourth quarter ending March 31, 2015 as follows:
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