The October launch of Red Dead Redemption 2 was the center of attention during Take-Two Interactive's (NASDAQ:TTWO) fiscal second-quarter conference call. The game is fully living up to both gamers' and investors' highest expectations, but there were other positives management talked about that point to a company continuing to fire on all cylinders.

Here's what management had to say about key areas impacting the company's performance.

A group in silhouette underneath the words "Red Dead Redemption 2" set against a red and orange painted background depicting a sunset.

IMAGE SOURCE: ROCKSTARGAMES.COM.https://www.rockstargames.com/downloads/collection/3/series/5636 

Top-of-the-line numbers

Total net bookings grew to $583 million, which exceeded our outlook range of $500 million to $550 million, due primarily to the out-performance of Grand Theft Auto V and Grand Theft Auto Online, as well as the successful launch of NBA 2K19.

-- CFO Lainie Goldstein 

Net bookings is a non-GAAP measure of revenue that accounts for physical and digital units sold during the period.

The credit to Grand Theft Auto for the quarter's outperformance is really impressive for one main reason: Take Two just released "the game of the decade" in Red Dead Redemption 2, which has already sold 17 million units since its Oct. 26 launch. This means that the company now has two highly engaging games to generate revenue heading into next year. This could have very positive implications for the long-term growth of the company.

Free cash flow is expected to roughly double to $670 million in fiscal 2019 (which ends in March). Essentially, Take Two is about to get an influx of cash on its balance sheet that will provide management more resources to reinvest in new games, add-on content, value-adding acquisitions, or return it to shareholders in the form of share repurchases or potential dividends.

NBA 2K experiencing record engagement

During the second quarter, recurrent consumer spending exceeded our expectations, growing 28%, and accounting for 53% of total net bookings.

-- CEO Strauss Zelnick 

Recurrent consumer spending is in-game revenue generated from virtual currency that players buy in NBA 2K, as well as money spent in other games like Grand Theft Auto Online

NBA 2K19 released in September, and it's off to a great start. Recurrent spending in the popular basketball franchise grew an impressive 70% year over year to a new all-time high for the company. Zelnick said NBA 2K was the "single largest contributor to recurrent consumer spending in the period." 

What's more, management said that players are still engaged with last year's NBA 2K18. Some of those players haven't transitioned over to the new version. This is unusual for a sports franchise, in which annual new releases give gamers updated rosters and new features that should be enough to encourage an upgrade. But management expressed uncertainty about what was causing players to stick with last year's version.

Either way, it's fine for Take Two. Zelnick explained that the high engagement across the franchise is indicative of the work Visual Concepts (the maker of NBA 2K) puts into the game for Take Two. All in all, management expects "the net bookings from NBA 2K19, including recurrent consumer spending, will be the highest ever for a 2K Sports title." 

The new standard

Red Dead Redemption 2 sold-in more units in its first eight days than the original blockbuster Red Dead Redemption sold in its first eight years and, as of today, the title has sold-in over 17 million units worldwide.

-- Zelnick 

There were sky-high expectations for this game, and Take Two delivered in spades. Some critics have given the game a perfect 10-out-of-10 review score, which is rare in the gaming industry. The game is tied with Grand Theft Auto V as the highest rated game on current generation consoles, and one of the highest rated games of all time. 

This month the company will be launching Red Dead Redemption Online -- the multiplayer component of the title -- which could be a significant driver of recurrent consumer spending, similar to the impact that Grand Theft Auto Online has had on the company's growth over the last five years.

Esports

Although management didn't go into detail, they also said more teams were sold during the quarter for NBA 2K League -- a professional esport based on the franchise. This brings the total number of teams to 21 heading into the league's second season next year. President Karl Slatoff spoke to the long-term impact esports is expected to have on the company: 

We look forward to the continued progress and growth of the league, which has a long-term potential to enhance engagement and to be a meaningful driver of profits for our company.

Looking ahead

As a result of our strong performance in the second quarter and outstanding early results from Red Dead Redemption 2, we are increasing our financial outlook for fiscal 2019, which is also poised to be a record year for net bookings and adjusted operating cash flow.

-- Zelnick 

It was already expected to be a record year, but those expectations are now higher. Management is now calling for adjusted revenue (or net bookings) of $2.8 billion to $2.9 billion for fiscal 2019. Cash flow from operating activities is expected to be $663 million, or $730 million on a non-GAAP basis. For perspective, the previous high for non-GAAP revenue was $2.414 billion in fiscal 2014 when Grand Theft Auto V originally launched.

As gamers read the rave reviews and word-of-mouth spreads, Red Dead 2 should continue to sell strongly through the holidays. 

John Ballard has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Take-Two Interactive. The Motley Fool has a disclosure policy.