Executive Summary
Take-Two Interactive reported a solid top-line improvement for QQ4 2025 with revenue of $1.5825 billion, up 13.1% year over year and 16.4% quarter over quarter, underscoring ongoing demand for core franchises such as Grand Theft Auto, NBA 2K, and other 2K titles. However, profitability collapsed due to a substantial non-operating expense line, resulting in an EBITDA of -$3.7141 billion and an operating income of -$3.7770 billion. Net income totaled -$3.7262 billion with diluted EPS of -$21.08, a sharp deterioration from prior periods. The disproportionate swing is driven by a large “other expenses” charge of $3.1643 billion in the quarter, which overwhelmed the positive gross margin (50.8%) and revenue growth. Despite the softness in reported earnings, Take-Two generated operating cash flow of $279 million and free cash flow of $224.9 million, leaving cash and cash equivalents of $1.471 billion at period end and net debt of $2.6349 billion. The balance sheet remains asset-heavy, with total assets of $9.1807 billion and sizeable non-current intangibles ($4.2286 billion) and goodwill ($1.0573 billion). The near-term liquidity profile shows a current ratio of 0.779, indicating tighter working capital; nevertheless, cash generation underpins near-term obligations and debt maturities. Management commentary on the drivers of the large non-operating charge is not provided in the available data, and there is no formal forward-looking guidance in the provided dataset. The company’s investment thesis hinges on the durability of its IP-rich portfolio, potential stabilization of profitability, and continued cash generation to deleverage.
Key Performance Indicators
QoQ: -2 759.12% | YoY:-39.21%
QoQ: -2 876.20% | YoY:-28.36%
QoQ: -2 869.01% | YoY:-23.85%
Key Insights
Revenue: $1.5825B (YoY +13.1%, QoQ +16.4%)
Gross Profit: $803.3M; Gross margin 50.76%; YoY gross profit change -6.77%; QoQ +5.71%
EBITDA: -$3.7141B; EBITDA margin not meaningful in the current period due to large non-operating item
Operating Income: -$3.7770B; Operating margin approx -238.6% (revenue-based)
Net Income: -$3.7262B; Net margin approx -235.5%
EPS: -$21.08; Diluted EPS -$21.08
Cash Flow: Operating cash flow $279.0M; Free cash flow $224.9M
Balance Sheet: Cash & equivalents $1.471B...
Financial Highlights
Revenue: $1.5825B (YoY +13.1%, QoQ +16.4%)
Gross Profit: $803.3M; Gross margin 50.76%; YoY gross profit change -6.77%; QoQ +5.71%
EBITDA: -$3.7141B; EBITDA margin not meaningful in the current period due to large non-operating item
Operating Income: -$3.7770B; Operating margin approx -238.6% (revenue-based)
Net Income: -$3.7262B; Net margin approx -235.5%
EPS: -$21.08; Diluted EPS -$21.08
Cash Flow: Operating cash flow $279.0M; Free cash flow $224.9M
Balance Sheet: Cash & equivalents $1.471B; Total debt $4.1059B; Net debt $2.6349B; Total assets $9.1807B; Total stockholders’ equity $2.1377B
Liquidity/Leverage: Current ratio 0.779; Debt-to-capitalization 0.658; Debt-to-equity 1.921; Cash conversion cycle ~26 days
Valuation Context: Price-to-sales ~23.15x; Price-to-book ~17.14x; Enterprise value multiple: negative (-10.58x) given the cash and debt mix; No dividend in QQ4 2025 period; Cash flow generation supports near-term liquidity despite negative earnings
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.58B |
13.08% |
16.38% |
| Gross Profit |
803.30M |
-6.77% |
5.71% |
| Operating Income |
-3.78B |
-39.21% |
-2 759.12% |
| Net Income |
-3.73B |
-28.36% |
-2 876.20% |
| EPS |
-21.08 |
-23.85% |
-2 869.01% |
Key Financial Ratios
operatingProfitMargin
-239%
operatingCashFlowPerShare
$1.58
freeCashFlowPerShare
$1.27
Management Commentary
No earnings call transcript data provided in the dataset. As a result, there are no management quotes or themed highlights to quote directly. If a transcript becomes available, the highlights would group management commentary by themes such as strategy (IP monetization, live-service evolution), operations (cost controls, title releases), and market conditions (retailer dynamics, platform shifts).
Forward Guidance
There is no formal forward guidance published in the provided data for QQ4 2025. Given the scale of the non-operating expense in the quarter, investors should monitor (i) whether the “other expenses” reverts to normal levels in future quarters or reflects a one-off impairment/transaction, (ii) the trajectory of live-service monetization, especially recurring digital revenue from existing franchises, (iii) progress on the IP pipeline and cadence of major game releases, and (iv) balance sheet leverage and debt maturities as cash flow evolves. Absent a clear guidance signal, compute scenarios around improved EBITDA if non-operating charges normalize, and assess cash flow resilience under continued R&D investment and potential release delays.