Take-Two raises fiscal outlook as recurrent spending experiences record growth
Take-Two Interactive has posted better-than-expected results for the third quarter ended December 31, 2018, thanks to strong performances from key titles like Red Dead Redemption 2 and NBA 2K19.
According to the company's latest financials, net revenue rose to $1.25 billion from $480.8 million. Recurrent consumer spending (from virtual currency, add-on content, and in-game purchases) accounted for 24 percent of that figure, and grew by a record 31 percent year-on-year.
The largest contributors to net revenue in the third quarter were Red Dead Redemption 2 (which generated $725 million during its first three days on shelves), NBA 2K19, NBA 2K18, Grand Theft Auto Online, and Grand Theft Auto V.
Digital revenue also grew to $594.7 million from $258.4 million year-over-year, and accounted for 48 percent of Take-Two's total net revenue. Again, the biggest earners on the digital front were Red Dead Redemption 2, Grand Theft Auto Online, Grand Theft Auto V, and NBA 2K18.
Net income was also on the rise, and increased to $179.9 million, or $1.57 per diluted share, compared to $25.1 million, or $0.21 per diluted share, on the previous year.
"Our performance was driven primarily by the record-breaking launch of Red Dead Redemption 2 along with strong results from NBA 2K19," commented Strauss Zelnick, Chairman and CEO of Take-Two.
"In addition, consumers engaged significantly with our offerings, and recurrent consumer spending grew by 31 percent to a new record. We generated strong cash flow and ended the period with $1.6 billion in cash and short-term investments, after deploying $109 million to repurchase 1 million shares of our stock."
Based on its current performance, Take-Two has upwardly revised its full-year forecast, and now expects to earn between $2.66 to $2.71 billion in net revenue and $354 to $367 million in net income by the end of the fiscal year on March 31, 2019.