Take-Two Interactive Reports Strong Earnings Ahead of Zynga Close – The Hollywood Reporter

Take-Two Interactive reported strong fourth-quarter earnings ahead of the company’s expected acquisition of mobile gaming company Zynga

The video game publisher reported net revenue of $930.0 million, up from $839.4 million in last year’s fourth quarter and above the Wall Street consensus. Net income was $111.0 million, or $0.95 per diluted share, as compared to $218.8 million, or $1.88 per diluted share a year earlier, also beating Wall Street expectations. 

Net bookings rose 8 percent year over year to $846 million. 

The top contributors to fourth quarter net revenue included NBA 2K22 and NBA 2K21; Grand Theft Auto Online and Grand Theft Auto V; Tiny Tina’s Wonderlands; Red Dead Redemption 2 and Red Dead Online; WWE 2K22; Top Eleven; and Two Dots.

Take-Two reached an agreement to acquire mobile gaming company Zynga in January 2022. Take-Two shareholders will vote on the transaction later this week, with the deal expected to close on May 23, 2022. 

Executives did not provide much further comment on the merger, except to say that the acquisition marks a “transformative moment” for Take-Two and will create a “powerhouse of industry leading titles.” Zynga’s titles include CSR Racing, Empires & Puzzles, FarmVille, Golf Rival, Harry Potter: Puzzles & Spells, Words With Friends and Zynga Poker.

Upcoming titles expected to contribute to bookings include the release of The Quarry in June 2022 and Marvel’s Midnight Suns in the second half of 2022. 

For the fiscal year 2023, the company expects GAAP net revenue of $3.67 to $3.77 billion, excluding Zynga, and net income of $223 to $252 million and net bookings of $2.75 billion to $3.85 billion. 

While the expected net bookings come in below Wall Street expectations, executives noted that demand for video games has “normalized” since early pandemic highs. 

“We expected that our audiences would stay with us and they have, and we also expected that we would see some level of pullback in terms of engagement amongst that audience,” CEO Strauss Zelnick said on the earnings call.

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