Take-Two Interactive Software, Inc.

Hello, everyone. Thank you for joining us, and welcome to the Take-Two Interactive Software first quarter fiscal year 2027 results conference call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Nicole Shevins, SVP Investor Relations and Corporate Communications. Nicole, please go ahead.

Good morning. Thank you for joining our conference call to discuss our results for the first quarter of fiscal year 2027 and to June 30, 2026. Today's call will be led by Strauss Zelnick, Take-Two's Chairman and Chief Executive Officer, Karl Slatoff, our President, and Lainie Goldstein, our Chief Financial Officer. We will be available to answer your questions during the Q&A session following our prepared remarks. Before we begin, I'd like to remind everyone that statements made during this call that are not historical facts are considered forward-looking statements under federal securities laws. These forward-looking statements are based on the beliefs of our management, as well as assumptions made by and information currently available to us. We have no obligation to update these forward-looking statements. Actual operating results may vary significantly from these forward-looking statements based on a variety of factors. These important factors are described in our filings with the SEC including the company's most recent annual report on Form 10-K and quarterly report on Form 10-Q, including the risks summarized in the section entitled Risk Factors. I'd also like to note that unless otherwise stated, all numbers we will be discussing today are GAAP and all comparisons are year over year. Additional details regarding our actual results and outlook are contained in our press release, including the items that our management uses internally to adjust our GAAP financial results In addition, we have posted to our website a slide deck that visually presents our results and financial outlook. Our press release and filings with the SEC may be obtained from our website at TakeTwoGames.com. And now I'll turn the call over to Strauss.

Thanks, Nicole. Good morning and thank you for joining us today. Fiscal 2027 is off to an excellent start, led by the power of our diverse portfolio and the strong, consistent execution of our strategy at all of our labels. We delivered first quarter net bookings of approximately $1.39 billion, which was slightly above the high end of our guidance range, primarily due to the outperformance of MBA 2K and the Grand Theft Auto series. We're reiterating our fiscal 2027 outlook for net bookings of $8 to $8.2 billion, which reflects both ongoing positive trends in our business and our high degree of confidence around the November 19th release of Grand Theft Auto VI. We expect to sustain this new level of scale and generate strong cash flows for the next several years as we release our robust development pipeline, capitalize on incremental opportunities within our highly established hit franchises and continue to apply our proven long-term approach to managing the company. Now, turning to highlights for the period. NBA 2K26's performance was outstanding and concluded a record year for the franchise. To date, the title has sold in over 12 million units, reflecting 9% growth compared to NBA 2K25. Engagement was up meaningfully during the quarter, with recurrent consumer spending growing 7%, driven by a 15% increase in average daily active users, a 25% increase in my career daily active users, and a 35% increase in average games played per user. The achievements of this year's iteration of the series are a testament to Visual Concept's ability continually to deliver new, innovative ways for fans to stay engaged and our live service execution remains a cornerstone of NBA 2K's sustained success. During the quarter, 2K also supported Borderlands 4, Sid Meier's Civilization 7 and WWE 2K26 with an array of new offerings, which enhanced player engagement and sentiment. The Grand Theft Auto series once again exceeded expectations, and to date, Grand Theft Auto 5 has sold in over 230 million units worldwide. Recurrent consumer spending for the series grew 3%, and GTA Plus continues to thrive, all led by a series of content offerings, including the addition of the Rockstar Mission Creator, an all-new suite of innovative and in-depth tools empowering the player community to bring missions to life. Global excitement for the launch of Grand Theft Auto VI continues to build, with the title having an exceptional start to pre-orders. With Rockstar Games' recent announcement of Grand Theft Auto VI and extended look coming on August 27th, we believe the consumer's passion and anticipation for the next evolution of this iconic series will grow further leading up to the title's November 19th release. Turning to our mobile business, Zynga performed in line with our expectations and we're pleased that many of our forever franchises continue to resonate with players. Net bookings for Tomb Blast grew 8% over last year. The title was supported by a new marketing campaign featuring Emmy nominated actor Giancarlo Esposito. Empires and Puzzles maintained steady momentum, anchored by a successful ninth anniversary campaign and the introduction of new heroes and character abilities. Words with Friends exceeded our forecast with net bookings growing 8% year over year, led by strong ad performance and higher player engagement with several features, including Dice Challenge, the title's latest permanent one-on-one game mode. Top 11 surpassed our expectations with net bookings increasing 15% year over year as fans enjoyed a special in-game event featuring player versus environment matches in 10 international locations. 2K's mobile offerings continue to perform well, with strong downloads and engagement across key titles. NBA 2K All-Star, our mobile title in China in partnership with Tencent, surpassed 10 million registered users since launching last year and is yielding strong profit margins. Our mobile direct-to-consumer channel remains a significant driver of revenue and margin enhancement, with many of Zynga's titles offering this feature and further growth anticipated. Guided by our core pillars to be the most creative, innovative, and efficient entertainment company in the world, our 13,000 colleagues share a singular vision for excellence and hit creation. Each day, we strive to bring joy to our player communities and value to our shareholders. I'd like to express my gratitude to our teams for their immense passion and unwavering commitment to our mission to make the most captivating and engaging experiences in the entertainment business. We believe that fiscal 2027 will be an inflection point for Take-Two, one that will write an exciting new chapter in our history and provide the foundation for new levels of success and the creation of groundbreaking entertainment experiences. I'll now turn the call over to Karl.