Take-Two reported today that its first quarter results were down, albeit not as sharply as it had been expecting.
For the three months ended June 30, revenue was down 2% to $813 million with net bookings down 29% to $711 million. Those numbers beat the company's revenue forecast, which topped out at $780 million, with the high-end of the net bookings range being $675 million.
Net income for the quarter was up 72% year-over-year to $152 million.
The publisher credited Grand Theft Auto V, Grand Theft Auto Online, Red Dead Redemption 2, Red Dead Online, and Borderlands 3 for driving its first quarter results.
Take-Two also noted it was facing a tough comparison with the year-ago quarter, the first full quarter of the pandemic when gaming publishers around the industry reported significant surges in their results.
"As we hopefully get out of this difficult time... it's nice to see the new normal for our business is much stronger than the old normal"
"We're gratified to see that as we expected, post-pandemic demand was higher than pre-pandemic demand, and the moderation we expected was not as severe as we expected," Take-Two chairman and CEO Strauss Zelnick tells GamesIndustry.biz in a call discussing the results, adding "As we hopefully get out of this difficult time -- it's hard to know given what's going on with the delta variant -- it's nice to see the new normal for our business is much stronger than the old normal."
As for specific titles, Grand Theft Auto V topped 150 million units shipped, with Grand Theft Auto Online's audience size up 72% over where it was two years ago.
Red Dead Redemption 2 has now shipped more than 38 million copies, while the Red Dead Online offshoot has grown its player base 18% over where it was in the first quarter two years ago.
NBA 2K21 and Civilization VI have now shipped more than 11 million copies each, with the latter outpacing Civilization V at this point in the game's lifecycle.
Despite the quarter surpassing the company's forecast, Take-Two reiterated its previous full-year guidance, saying the first quarter performance and expected contributions from first quarter acquisition Nordeus will be offset by delays to two of its "immersive core titles" which will now ship later this fiscal year than expected.
The publisher also said its 2K label will announce a new franchise later this month, although it did not indicate if that was one of the delayed titles.
Zelnick has previously said the pandemic hasn't impacted the publisher's development pipeline, and characterizes these two delays as stemming from "our unending search for quality and polish" as opposed to any kind of impact from work-from-home development.
Looking forward, Take-Two is again setting the bar lower than last year. For the second fiscal quarter, it is expecting revenues down as much as 12% ($740 million to $790 million) with net bookings possibly sliding 15% ($815 million to $865 million). Net income is also forecast to be roughly halved, falling somewhere between $41 million and $53 million.
Even if Take-Two has trouble posting positive numbers in the near-term, Zelnick says it shouldn't be long before it returns to growth.
"When issues raise themselves -- and of course, with 6,800 people there's always an opportunity for a misunderstanding -- we address it at the highest level. We make sure that we make things right to the best of our ability"
"We're bringing 20 titles to market this year, and we expect to bring roughly that amount for the following two years," he says. "And we expect to set records again starting in fiscal '23."
Given Zelnick's position as the head of a major publisher and the recent allegations of discrimination at Activision Blizzard and new reports around Ubisoft, we ask why these kind of stories keep coming out of the games industry, and how things could improve.
"I can only really talk about us," Zelnick starts. "Our culture is one of inclusiveness, common decency, mutual ambition for success, transparency, honesty, and kindness. And everyone in the firm knows that. If people have concerns, they have direct access to me, and everyone in the company knows that as well.
"When issues raise themselves -- and of course, with 6,800 people there's always an opportunity for a misunderstanding -- we address it at the highest level. We make sure that we make things right to the best of our ability."
Zelnick notes the company has "deepened its focus" on corporate social responsibility and made multiple hires for diversity, equity, and inclusion positions both at the corporate level and at its publishing labels.
"We think we as an industry and we as a company can of course do more," Zelnick says. "We have an exceedingly diverse board at our company, and have had for a very long time. We're proud of our record, and at the same time we don't rest on that. We know there's always more to be done."