🚀 MarketWire | Take-Two Deep Dive: Was Zynga the worst acquisition in the games industry?

Hello GameMakers,

This week I wanted to make sure you were aware of a deep dive session that we recorded for Pixels & Profits focusing on Take-Two!

We cover:

• Take-Two Fundamentals

• Organizational structure and 4 primary publishing labels: Rockstar Games, 2K, Private Division, and Zynga

• How does T2 get from ~$5.5B bookings guidance for fiscal 2024 to $8B in fiscal 2025! What else could it be besides GTA6?

• Zynga acquisition 😱

• General future outlook

Check out the discussion below!

Top 10 Charts

• ROBLOX, Royal Match, and Monopoly GO in Top 10 WW Downloads and Revenue!

• I’m telling you guys Booger Please would out DL Burger Please! Lol. If no one else does it, I may have to do it next year.

• Outfit 7 is the only publisher with 2 Top 10 WW Download games and miHoYo is the only publisher with 2 Top 10 WW Revenue games.

• Why is Jackpot Party Casino always Top 10 Revenue in US? I bet this webinar can help answer that question:

  • Data.ai x GameMakers with SciPlay on Building a Liveops Roadmap

• Chinese love MOBAs, Shooters, Auto Chess, Match-3, and Minecraft?

• The company that takes Golden Spatula West gonna make billions.

Top 10 Mobile Publishers

• It’s odd that miHoYo would have 2 Top 10 WW Revenue games but rank #5 as a Top Mobile Publisher for the week.

Top 5 Mobile Trending

• What lesson can we learn from 0% paid downloaded games like Ghost Run and Eternal Ember?

Top 10 Steam Game Sellers

• What happens to Battlebit now that it’s dropped off the charts? Are they on the hook to pay liveops costs forever?

  • 2M x $15 = $30M / monthly liveops cost = ?

🔦 Spotlight | Take-Two Interactive Deep Dive and the Zynga Mobile Business

🎧 Listen on Spotify, Apple Podcasts, or Anchor

Speakers:

• Joseph Kim. CEO at Lila Games.

• Eric Kress. Principal at Gossamer Consulting.

• Brian Peganoff. Founder at Timber Advisors.

• Matthew Kanterman. Director of Research at Roundhill Investments.

OUTLINE:

• 0:00 Intro

• 2:45 Take-Two Fundamentals

• 6:25 The $5.5B to $8B guidance in bookings

• 7:12 What could be driving $8B in bookings

• 10:30 Comparing King acquisition vs. Zynga

• 13:07 Rockstar and 2K Overview

• 15:38 Kress’ take on T2 business

• 20:57 Zynga Overview

• 23:15 Eric: Why Zynga was the worst acquisition ever

• 29:50 Why some investors ignore T2 longer-term risk

• 30:40 Bull case for T2

• 31:38 Why GTA6 will not sell as much as GTA5

• 32:48 The PC case for GTA6

• 33:38 Product portfolio strategy discussion: broad vs. focused

• 37:49 Overall outlook

• 38:25 T2 acquisition scenarios

• 40:25 Growth opportunities

• 46:52 Why did T2 buy Zynga and what are the ramifications?

• 53:37 Conclusions

Key points on Take-Two:

• Main business is GTA and 2K.

• Prior to mobile T2 was 71% console.

• Last fiscal $2.5B of $5.3B of bookings is from mobile - now majority of bookings is mobile.

• Currently not operationally profitable.

• Key Titles:

  • Grand Theft Auto franchise: 400M units sold lifetime

    • GTA V: 180M units lifetime

  • Red Dead Redemption franchise: 75M units sold lifetime

  • NBA 2K: 135M units sold lifetime

  • Borderlands: 80M units sold lifetime

  • Civilization: 67M units sold lifetime

  • Bioshock: 42M units sold lifetime

• 60% of revenue comes from US.

Take-Two’s Zynga Mobile Business:

This business is up on downloads but dropping from a revenue perspective if we look at the top 18 titles in each area: