TTWO · Q2 2026 Earnings

Bullish

Take-Two Interactive

Reported November 6, 2025

30-second summary

Take-Two's Q2 net bookings of $1.96B beat the prior $1.70–1.75B guide by 12–15% and grew 33% YoY — the best Q2 net bookings in company history, driven by NBA 2K26's unprecedented monetization and mobile holding double-digit growth a second straight quarter. Management raised FY2026 net bookings by $350M at midpoint to $6.40–6.50B, doubled the operating cash flow outlook to ~$250M, and more than doubled the FY RCS growth assumption from 4% to 11%. GTA VI remains dated November 19, 2026, and Strauss restated the FY2027 "record net bookings … new baseline" framing — the bridge year is now stepping up materially higher than the stepping-stone narrative implied 90 days ago.

Headline numbers

EPS

Q2 FY2026

$-0.73

Revenue

Q2 FY2026

$1.77B

+31.1% YoY

Gross margin

Q2 FY2026

55.3%

Operating margin

Q2 FY2026

-5.5%

Key financials

Q2 FY2026

Metric	Q2 FY2026	YoY	Q1 FY2026	QoQ
Revenue	$1.77B	+31.1%	$1.50B	+18.0%
EPS	$-0.73	—	$-0.07	-942.9%
Gross margin	55.3%	—	62.8%	-750bps
Operating margin	-5.5%	—	1.4%	-690bps

Guidance

Guidance is issued for both next quarter and the full year. Both may appear below.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Revenue	Q2 FY2026	$1.65 to $1.70 billion	$1.7738 billion	+$0.07 to $0.12 billion above guide (4–7% beat)	Beat
EPS	Q2 FY2026	$(0.75) to $(0.60)	$(0.73)	+$0.02 to $0.03 above guide (loss smaller than expected)	Beat
Net Bookings	Q2 FY2026	$1,700 to $1,750 million	$1,960.5 million	+$210 to $261 million above guide (12–15% beat)	Beat
Non-GAAP EBITDA	Q2 FY2026	$117 to $140 million	$116.7 million	in-line (near low end of guide)	Beat

New guidance

Metric	Period	Guide	YoY
Recurrent Consumer Spending Growth	FY2026	—	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Revenue	FY2026	$6.10 to $6.20 billion	$6.38 to $6.48 billion	+$0.28 to $0.38 billion (midpoint +$0.325B or +5.3%)	Raised
EPS	FY2026	$(2.40) to $(2.05)	$(2.25) to $(1.90)	+$0.15 to $0.35 (loss narrowing; midpoint improved $0.15)	Lowered
Net Bookings	FY2026	$6,050 to $6,150 million	$6,400 to $6,500 million	+$250 to $450 million (midpoint +$350M or +5.7%)	Raised
Non-GAAP EBITDA	FY2026	$554 to $613 million	$579 to $637 million	+$25 to $24 million (midpoint +$24.5M or +4.2%)	Raised
Operating Cash Flow	FY2026	approximately $130 million	approximately $250 million	+$120 million (+92%)	Raised
Capital Expenditures	FY2026	approximately $140 million	approximately $180 million	+$40 million (+29%)	Raised

Segment performance

Q2 FY2026

Segment	Q2 FY2026	YoY
Mobile	$0.822B	+11.0%
Console	$0.72B	+46.6%
PC and other	$0.232B	+90.6%
Digital online	$1.693B	+30.2%
Physical retail and other	$0.081B	+52.0%

Platform metrics

Q2 FY2026

Segment	Q2 FY2026
Net Bookings	$1,960.5 million
Recurrent Consumer Spending (% of Net Bookings)	73%
Recurrent Consumer Spending (% of Revenue)	72%
Net Bookings YoY Growth	33%
Recurrent Consumer Spending YoY Growth	20%
Digital Online (% of Net Bookings)	95%

Profitability

Q2 FY2026

Segment	Q2 FY2026
EBITDA	$116.7 million
Operating Cash Flow (6M)	$83.7 million

Other KPIs

Q2 FY2026

Segment	Q2 FY2026	YoY
United States	$1.036B	+27.2%
International	$0.738B	+36.9%

Management tone

Q3 FY2025 (audience scale thesis) → Q4 FY2025 (GTA VI dated, FY26 framed as stepping stone) → Q1 FY2026 (stepping stone stepping up) → Q2 FY2026 (bridge year materially re-rated).

Three quarters ago management was selling the Zynga acquisition's audience-scale thesis after a $3.55B goodwill impairment had just rebased the carrying value. Two quarters ago FY2026 was explicitly framed as a stepping stone at ~5% net bookings growth. One quarter ago it was raised to 8% growth at midpoint with mobile guidance kept deliberately conservative. This quarter the FY net bookings guide is up another $350M and the language is "record levels of Net Bookings in Fiscal 2027 … new baseline … path of enhanced profitability." The stepping-stone framing has been retired; FY26 is now itself a re-rating year. The escalating posture across four prints — and the willingness to raise operating cash flow guidance by $120M — is the most aggressive Take-Two has telegraphed in years.

The mobile narrative has shifted from "growth contributor with hyper-casual decay risk" to "major strategic driver with legislative tailwinds." Last quarter Carl was actively talking down mobile expectations to preserve upside-surprise optionality; this quarter the framing is structural: "recent legislative changes [enable] direct transactions and new payment mechanisms…which should help us expand meaningfully net bookings and margins via this highly accretive channel." The $120M operating cash flow raise is the financial signature of that shift — distribution-cost savings flowing through to cash.

NBA 2K's monetization story has compounded. Q1's RCS commentary was that 48% YoY growth came from improved telemetry-driven monetization. This quarter management frames NBA 2K26 as having driven "unprecedented" in-game spending, and the FY RCS growth assumption was lifted from 4% to 11% — "more than double our prior forecast … driven by NBA 2K and higher expectations for several mobile titles." A FY RCS guide that more than doubles mid-year is rare and concrete.

GTA V's role in the narrative has also shifted. Last quarter GTA V was described as a maturity story with sustained engagement. This quarter Strauss describes GTA Plus membership at over 20% YoY growth as the runway: "we believe will help usher in a record-breaking launch for Grand Theft Auto VI." The framing now treats GTA V's living engagement base as a captive marketing asset for GTA VI's November 19, 2026 launch — note that the release date moved from May 26, 2026 (per Q4 FY2025 release) to November 19, 2026, a six-month slip that the company is absorbing without softening forward language.

Borderlands 4 is the only place management hedged: "we experienced some challenges with optimization of performance on PC … We're confident that Borderlands 4 will achieve strong unit sales over its lifetime." The language is calibrated — acknowledging the launch issue but anchoring to lifetime sales rather than near-term contribution. That's the same playbook used historically on bumpy launches.

Recurring themes management leaned on this quarter:

Record-breaking mobile performance and monetizationNBA 2K26 unprecedented in-game spending and engagementLive services and recurrent consumer spending accelerationGTA VI positioning as transformational eventDirect-to-consumer monetization expansion via legislative changesPremium narrative-driven games validating market demand

Risks management surfaced:

Borderlands 4 PC optimization and performance issuesDependency on core franchises (NBA 2K, GTA, mobile titles)GTA VI launch timing and execution riskMacro uncertainties affecting consumer spendingMobile regulatory and legislative changes

Q&A highlights

Doug Kruitz · TD Cowen

How does Take-Two's position as the last major standalone public publisher affect its ability to attract talent and place games in the market, and what strategic competitive advantages does this provide?

Management acknowledged being well-positioned with strong financial metrics (underleveraged, expecting to return to net cash), but emphasized avoiding complacency. Noted independence and public security as potential advantages, but stressed that execution and creative performance remain the true drivers of success, not structural position alone.

Company is underleveraged at year-endExpected to be net cash company in relatively short orderManagement maintains 'running scared' mentality despite strong performance

Chris Shoal · UBS

How have alternate payment mechanisms (direct-to-consumer) benefited margins, particularly on mobile, and what are expectations around Google Play changes?

Management confirmed direct-to-consumer initiative is successful and rolled out across most of mobile portfolio. Distribution costs declining due to competition and litigation. Most recent litigation result puts company in stronger position with both net bookings and margins rising. Increased full-year guidance reflects margin improvements.

Direct-to-consumer rolled out across nearly entire mobile portfolioDistribution costs declining with competition and litigationFull-year guidance increased due to margin expansionNet bookings rising faster than expected with margins also rising

Matthew Cost · Morgan Stanley

What drives Zynga's outperformance versus broader mobile market, and is the company considering increased M&A in mobile gaming to sustain momentum?

Attributed outperformance to great leadership (CEO Frank Jabot), execution, and disciplined portfolio approach (fewer titles pursued simultaneously, willingness to walk away from underperformers). On M&A, emphasized selectivity with track record of successful acquisitions, requiring strategic alignment, cultural fit, and immediate accretion to management cash flow.

Zynga pursuing fewer titles at once with higher focus on winnersWalking away from non-performing titles earlier in developmentTake-Two has history of acquisitions that worked outM&A rubric requires strategic alignment, cultural fit, and immediate accretion

Andrew Merrick · Raymond James

For NBA 2K, where are incremental audiences coming from, what inning of NBA audience penetration is the company in, and how do PC issues on Borderlands affect recovery trajectory?

NBA growth driven by improved returning player retention, international expansion, and better engagement of existing player base. Management indicated not in first inning but not at seventh inning stretch (approximately middle innings). On Borderlands, acknowledged softer-than-desired launch due to PC issues but expects solid unit sales and results in line with expectations over time.

NBA retention rates still have substantial room for improvementInternational expansion contributing to audience growthPre-order early access and game tightness improving engagementBorderlands PC challenges being addressed by Gearbox

Ed Alters · Jefferies

Can you update on BioShock franchise with Rod Ferguson hire, and explain the recent ad revenue strength in mobile?

Management expressed excitement about Rod Ferguson as new BioShock franchise head, noting his Bioshock Infinite and Gears/Diablo background. Indicated organizational changes made and game on great track to exceed consumer expectations. Ad revenue growth attributed to strong performance across entire mobile business, particularly Rolick portfolio.

Rod Ferguson hired as head of BioShock franchiseBioShock game on great track for releaseAd revenue strength from entire mobile business, particularly RolickAd revenue up two quarters for first time in a while

Answers to last quarter's watch list

Q2 FY2026 net bookings vs. the $1.70–1.75B guide. $1.96B printed — 12–15% above the high end of guide, +33% YoY, best Q2 in company history. The "at or above the high end would set up a second FY raise" condition was decisively triggered: FY net bookings raised $350M at midpoint.

Resolved positively

Mobile growth in Q2 vs the FY low-single-digit implied trajectory. Mobile net revenue grew +11.0% YoY, second consecutive double-digit quarter. The FY mobile composition has been refreshed via the RCS growth raise from 4% to 11%, and the UBS exchange confirmed structural margin gains via direct-to-consumer payments.

Resolved positively

RCS share of bookings. RCS came in at 73% of Q2 net bookings, down from 83% in Q1 — but this is the mechanical result of large premium launches (NBA 2K26, Borderlands 4, Mafia) inflating non-RCS revenue, not an engagement weakness. The FY RCS dollar guide actually more than doubled (4% → 11% growth, 77% of bookings).

Resolved positively

GTA VI marketing or production cadence disclosure. GTA VI release date moved from May 26, 2026 to November 19, 2026. Management restated the FY2027 "record net bookings … new baseline" language, but the six-month slip is the material disclosure. Status: Resolved negatively (date slipped, though forward framing held).

Advertising revenue trajectory. Management noted ad revenue grew two quarters in a row "for the first time in a while," driven by the Rollic portfolio. Specific dollar figure not disclosed on the print. Status: Resolved positively (qualitative confirmation; quantitative tracking continues).

What to watch into next quarter

GTA VI release date stability at November 19, 2026. The date already slipped six months from the original May 2026 commitment. Any further slippage at the Q3 print would force a material re-rating of the FY2027 "new baseline" assumption — the entire forward narrative is anchored to this date holding.

Q3 FY2026 net bookings vs. the $1.55–1.60B guide. Q3 is the holiday quarter without major new launches (post-NBA 2K26, post-Borderlands 4, pre-GTA VI). A print at or above the high end implies live-services momentum is genuinely structural; a low-end print would suggest Q2's beat was launch-loaded.

Direct-to-consumer mobile margin contribution disclosure. Management confirmed DTC is rolled out across nearly the entire mobile portfolio and explicitly linked it to the operating cash flow raise. Watch for any quantification of the margin lift in Q3 — without numbers, the structural-driver thesis is harder to underwrite.

RCS growth tracking against the new 11% FY guide. Q2 RCS grew 20% YoY; Q3 guide implies ~8%. Whether the trajectory stays above the FY 11% line through a tougher holiday compare, or decelerates faster than guided, will determine whether the FY guide gets raised a third time.

Borderlands 4 PC sales trajectory. Management hedged to "strong unit sales over its lifetime" rather than near-term contribution. Any cumulative-sales disclosure at Q3 will signal whether Gearbox's optimization fixes have unstuck the launch trajectory.

Sources

Take-Two Interactive Q2 FY2026 earnings press release, SEC filing dated 2025-11-06: https://www.sec.gov/Archives/edgar/data/946581/000162828025050182/ttwo2q26earningsrelease.htm
Take-Two Interactive Q2 FY2026 earnings conference call transcript, 2025-11-06.

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