During Take-Two Interactive Software’s quarterly financial conference call, CEO Strauss Zelnick was asked to comment on the reports of a slowdown of current generation consoles and added more color about the PC market.
As part of the livestreamed Q&A, Zelnick has seen the same reports, but he’s not particularly concerned about the possibility of a consumer recession.
While he admits he’s not in the business of predicting that kind of thing, the metrics he sees don’t support that theory.
“I’m not particularly worried from one report that we’re heading into some kind of consumer recession. I don’t see it. Now, I’m also not a business of predicting that sort of thing, but the metrics don’t support that.
Generally speaking, the entertainment business is pretty resilient in such a situation. Of course, the business is not counter-cyclical and, you know, in some massive downturn we of course would be negatively affected, but I just don’t see that on the horizon.
So not a current concern for us, and we’re awfully well positioned. As you know, our industry is back in growth mode, console businesses for software is up low-single digits, mobile is up mid-single digits, so, there are Tailwinds, and our mobile business, is really performing with all these new great titles, which we referenced today.
And we’re really excited about our console pipeline as well, which we think will continue to perform.”
Zelnick also mentions that the company expects “tremendous growth” in the next two fiscal years (between April 2025 and March 2027), which certainly isn’t surprising since Grand Theft Auto VI is coming in the fall of 2025.
“Obviously, we’re we’re announcing a quarter and we’re right on track with very consistent results that are squarely within or better than guidance and consensus.
We’ve reiterated our guidance for the year and we’ve said that we expect tremendous growth in fiscal, 26 and 27. So we’re about as optimistic as we can be without overstating the case, something that we try really hard not to do.”
About the performance of consoles, he mentioned that conditions in the market always change and he believes that Generation 9 platforms (PS5 and Xbox Series X|S) will continue to perform, while PC (which wasn’t as relevant in the previous generation) is a “big growth market.”
“Specifically, with regards to hardware, I saw the same stats that you did, and it looks like if you just measure four years in last time, this time seems there’s a bit of slowing, and you know, the report I saw said, “where are the Pro devices” and the like…
But everything always changes. Four years ago, PC wasn’t anywhere near as meaningful as it is today for console-type releases. That’s that’s a big growth market.
And no, I don’t think what consumers are saying is they’re good with Gen 8 and don’t care about Gen 9. We saw the exact contrary with regard to NBA 2K where Gen 8 actually was not a high performer and performed worse than we expected. Gen 9 has been incredibly powerful, so I think the Gen 9 platforms will continue to perform.
I think you’ll continue to see meaningful growth in that installed base and I wouldn’t put too much weight on a particular period of time.”
At the end of his answer, Zelnick also did not fail to boast that Take-Two is working on the best pipeline it has ever had, and it’s close to coming to fruition.
I was asked earlier today by someone what’s next on the hardware side and my attitude is we’re not in the hardware business and I wouldn’t even know how to answer that question, but what’s next on the entertainment side and the software side Is we’ve got a bunch of great titles in the market, great live services, and great new titles coming.
We have the best pipeline we’ve ever had and it’s close to coming to fruition, and we feel really great about that.
If you’d like to read more details on Take-Two’s financial performance, you can read our dedicated article.
If you’d like to read more about gaming industry financial results, several have already been announced and we have dedicated reports, including Capcom, Koei Tecmo, Microsoft, Electronic Arts, Konami, Nintendo, Square Enix, Sega, Sony, and Warner Bros. Discovery.
