TTWO Set to Report Q4 Earnings: What's in Store for the Stock?

TakeTwo Interactive Software TTWO is scheduled to release fourth-quarter fiscal 2025 results on May 15.

For the fourth quarter of fiscal 2025, TakeTwo expects GAAP net revenues between $1.52 billion and $1.62 billion. It anticipates a GAAP net loss per share of 20 cents to earnings per share of 13 cents.

The Zacks Consensus Estimate for TTWO’s fiscal fourth-quarter revenues is pegged at $1.55 billion, indicating growth of 14.73% on a year-over-year basis.

The consensus mark for earnings is currently pegged at $1.08 per share, which remained unchanged over the past 60 days, indicating year-over-year growth of 248.39%.

TTWO beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, with an average surprise of 206.58%.

TakeTwo Interactive Software, Inc. Price and EPS Surprise

TakeTwo Interactive Software, Inc. price-eps-surprise | TakeTwo Interactive Software, Inc. Quote

Let us see how things have shaped up for the upcoming announcement.

Key Factors to Consider for TTWO

NBA 2K is expected to have driven results in the fourth quarter of fiscal 2025, with net bookings projected by the company to benefit from a high-teens percentage increase in recurrent consumer spending for the franchise. Titles like Grand Theft Auto V and GTA Online are also likely to have continued contributing meaningfully, although GTA Online is expected to have seen declines during the quarter under review. Red Dead Redemption 2 and Red Dead Online remain active, with high levels of player engagement reported in the prior quarter.

The fiscal fourth quarter is expected to have included contributions from new launches such as Sid Meier’s Civilization VII, PGA Tour 2K25, and WWE 2K25. Civilization VII has already set a franchise record for preorders, and early access was launched in the current quarter. WWE 2K25 and PGA Tour 2K25 are expected to have supported top-line growth with new gameplay features and expanded content offerings.

Mobile bookings, however, are expected to have faced headwinds. TakeTwo projects only a low single-digit growth in mobile for the fiscal year, with mobile performance in the fiscal fourth quarter having been influenced by continued underperformance in some titles like Empires & Puzzles. The hyper-casual mobile segment is also expected to have weighed slightly on results.

On the cost side, GAAP operating expenses for the fiscal fourth quarter are projected between $900 million and $920 million by the company. The company expects a 2% decline in operating expenses year over year, primarily due to normalized marketing for Match Factory and cost savings initiatives. Despite the shift of some expenses from the prior quarter to the quarter under review, the bottom line is expected to have shown significant improvement.

What Our Model Says

According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the exact case here.

TTWO has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few companies worth considering, as our model indicates that they possess the right combination of factors to exceed earnings expectations in their upcoming releases:

Capital Southwest CSWC currently has an Earnings ESP of +3.23% and a Zacks Rank #2.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Capital Southwest shares have lost 4.6% year to date. CSWC is slated to report its fourth quarter fiscal 2025 results on May 14.

Baidu BIDU has an Earnings ESP of +8.67% and a Zacks Rank #3 at present.

Baidu shares have gained 8.3% year to date. BIDU is scheduled to report its first-quarter 2025 results on May 21.

Applied Materials AMAT has an Earnings ESP of +1.94% and a Zacks Rank #3 at present.

AMT shares have gained 13.4% year to date. It is scheduled to report its second-quarter fiscal 2025 results on May 15.

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This article originally published on Zacks Investment Research (zacks.com).

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