Take-Two Enjoying BioShock: Fool by Numbers

On Sept. 10, game developer Take-Two Interactive Software (Nasdaq: TTWO  ) released third-quarter earnings for the period ended July 31.

  • Revenue dropped 14.4% to $206.4 million due to last year's strong sales of its Grand Theft Auto franchise.
  • During the quarter, the company released a new horror franchise, BioShock.
  • The company released positive adjusted guidance of $1.30 to $1.50 for the 2008 fiscal year based on a strong pipeline of games, including the latest Grand Theft Auto release.
  • Take-Two is a two-star stock in Motley Fool CAPS, our free interactive stock database, where five stars is the tops. Game developers Electronic Arts (Nasdaq: ERTS  ) and Activision (Nasdaq: ATVI  ) have earned three and four stars, respectively.   

(Figures in millions, except per-share data)

Income Statement Highlights

Q3 2007

Q3 2006

Change

Sales

$206.4

$241.2

(14.4%)

Net Profit

($58.5)

($91.4)

N/A

EPS

($0.81)

($1.29)

N/A

Diluted Shares

72.1

71.1

1.4%

Get back to basics with the income statement.

Margin Checkup

Q3 2007

Q3 2006

Change*

Gross Margin

18.5%

23.7%

(5.2)

Operating Margin

(27.7%)

(19.5%)

(8.2)

Net Margin

(28.4%)

(37.9%)

9.5

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

Q3 2007

Q3 2006

Change

Cash + ST Invest.

$61.6

$179.1

(65.6%)

Accounts Rec.

$100.4

$98.0

2.4%

Inventory

$75.8

$83.2

(8.9%)

Liabilities

Q3 2007

Q3 2006

Change

Accounts Payable

$93.3

$80.1

16.5%

Long-Term Debt

$11.0

$0.0

N/A

The balance sheet reflects the company's health.

Cash Flow Highlights

YTD 2007

YTD 2006

Change

Cash From Ops.

($72.8)

$84.4

N/A

Capital Expenditures

$16.6

$18.6

(10.6%)

Free Cash Flow

($89.4)

$65.8

N/A

Free cash flow is a Fool's best friend. 

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