Conference Transcript - TTWO 2026-05-27

Doug Kreutz, Analyst — TD Cowen

Thank you all for being here today. My name is Doug Kreutz. I'm the senior media and entertainment analyst here at TD Cowan. As a PSA, I'm sure you all know, the Extel voting window is open. TD appreciates your vote, as do I. And I'm very pleased to have with me here today, the chairman and CEO of Take-Two Interactive, Strauss Zellnick. Thanks, Doug. Nice to be here. I have been joking with clients that artificial general intelligence is like GTA 6 it's always 12 to 18 months away but I'm going to have to retire that joke because we are now less than six months away from GTA 6 we do think it's going to be the biggest entertainment launch of all time which is a high bar so how do you define success for a product like that beyond you know revenue units and how does Rockstar define success and what's their ambition for the product

Strauss Zelnick, CEO

Well, we are aiming to make, in everything that we do, the greatest entertainment on earth. That's our goal. Our goal is to make phenomenal entertainment. And our strategy is to be the most creative, the most innovative, and the most efficient company in the entertainment industry. And each of our labels, in its own way, tries to create something extraordinary in everything that they do. And sometimes we fall short, of course. And you probably put a fine point on that at Rockstar. given the Metacritic scores that they've always enjoyed and the breathtaking success of Grand Theft Auto and Red Dead and other intellectual properties that Rockstar has brought to market over its 25-year history. So you can imagine that the ambitions are very, very high, both for Rockstar and for Take-Two. but I think you would define success you know you can't help it in terms of the scores it gets or reviews it gets and the unit sales do you think about it in terms of engagement over the long term well of course we can't help thinking that way because Grand Theft Auto 5 has thrived through three console generations and is sold in 230 million units so and has been around for the the better part of 13 years and shows no signs of abating. And Grand Theft Auto Online, of course, remains a very powerful property. And you've seen the economic effect of that title when Rockstar generates meaningful unit sales year in, year out, and also has significant recurrent consumer spending year in, year out. We've also guided to significant recurrent consumer spending going forward for Rockstar.

Doug Kreutz, Analyst — TD Cowen

And you anticipated my next question. You had on your earnings call last week.

Strauss Zelnick, CEO

It's amazing how you can anticipate the next question. It's amazing. When you provide them to our head of IR, Nicole, in advance. It's extraordinary. I have this incredible mental capacity to read. You're giving away our secrets.

Doug Kreutz, Analyst — TD Cowen

So, yeah, you did guide to GTA.

Strauss Zelnick, CEO

Let's see if you guys are awake. And, you know, these conferences, like, just to get a smile out of you all is challenging. And so I'm so gratified. I got you all. You must be caffeinated. I don't want to be in the third slot today. Sorry, go ahead.

Doug Kreutz, Analyst — TD Cowen

So you did talk about GTA recurrent consumer spending growing this year. And I know you're not going to divulge sort of what the plans are for GTA 6 launch. But can you talk about what Rockstar has learned from GTA Online and Red Dead Online in terms of running a successful live service title, what they may have learned from observing other parts of your portfolio like NBA 2K and Zynga, or even looking at some other high-profile live service launches in the last few years that haven't gone well.

Strauss Zelnick, CEO

So remember, we have live services at Rockstar now, right? We have GTA Online. We have GTA Plus. We have the 5M business. So we already have that in market, and we expect those businesses to continue to thrive. There'd be no reason that they would not. And what have we learned? give consumers something great and they show up for it. We've learned the oldest lesson in the entertainment business.

Doug Kreutz, Analyst — TD Cowen

In terms of how getting the mix of...

Strauss Zelnick, CEO

By the way, that leads me to a story, which is true. So I started in the movie business and the television business. And Columbia Pictures, I worked at Columbia Pictures and I bet there's no one here who knows this, but the head of Columbia Pictures in its heyday, Columbia Pictures was a B studio going back into the old days. And the head of Columbia Pictures was a guy named Harry Cohn. Anyone know this? This is a true story, and Harry Cohn was detested, reviled in the movie business by everyone, and so much so that there was some amusement at the fact that people were at his funeral, and two stories about that. One is someone said to, I think, Jack Warner, but I'm not sure, why do you think there's so many people at Harry Cohn's funeral? And he did say, give people what they want. They come out for it. And true story. And the rabbi who officiated at the funeral was a famous rabbi in Los Angeles named Rabbi Magnin. And someone went up to him and said, Rabbi, you must be able to say something nice about Harry Cohn. I mean, this was the rabbi at the funeral, and he said, he's dead. Okay, but I digress. Anyway, you give people what they want, they come out for it. That is true.

Doug Kreutz, Analyst — TD Cowen

If we look beyond...

Strauss Zelnick, CEO

You can look it up. Both are true stories.

Doug Kreutz, Analyst — TD Cowen

If we look beyond GTA 6, I'd imagine a few things are probably true.

Strauss Zelnick, CEO

I'm trying to divert you. It's just not working. I know, I know, I know.

Doug Kreutz, Analyst — TD Cowen

I'm going to talk about it.

Strauss Zelnick, CEO

We'll move on from GTA 6 in a second.

Doug Kreutz, Analyst — TD Cowen

I would think Rockstar would probably, beyond GTA 6 not like to have another 13 year gap between GTA releases maybe not, I mean obviously GTA 5 has done very well, and I assume Rockstar has other ideas that they'd like to pursue beyond just GTA, so how are you and they thinking about how they evolve over the next 10 or so years to best serve their audience and create value for the company, organizationally

Strauss Zelnick, CEO

the only way I can answer that is to say these are the very conversations we always have with all of our labels, Rockstar included, and we have a plan. And our plan might not be to have a specific cadence around our properties because we're not a cadence-driven company. We never have been. I didn't show up at Take-Two nearly 20 years ago and say, the way everyone else was, we're going to annualize our products like clockwork. To the contrary, and I was an outlier at the time, I said the only products we're going to annualize are sports entertainment properties. We are specifically not going to do it with everything else. I was very unheard of in the business at the time. And the thesis was that if you do that, A, you're going to burn off your intellectual property because you're in market too often. B, you can't possibly deliver the kind of quality you need to deliver to deliver an A-plus property by doing that. And I'm not going to name the properties, but we've seen that some very competitive properties have had good annual releases and bad annual releases because it's just so hard to do. And also, if you take a look at the intellectual property landscape when I joined Take Two in 2007, you know, GTA was not the number one property. It was a top five property, but it was not the number one property. And take a look at what happened to the properties that were higher up in the food chain that were annualized to see what happened. So we set a new standard in the business, which is you have to make stuff that's great, and creating some anticipation on the part of the consumer is a good thing. That doesn't mean that we said there should be an X-year gap between releases. What has driven the gap is the amount of time it takes to do something that is as good as it can possibly be for that intellectual property. And sometimes, for example, with Borderlands, Gearbox has done a great job coming to market somewhere between two and four years after a release and, generally speaking, succeeded mightily at doing it. And in other instances, for example, Bioshock gets taken longer than we would like. In the case of GTA V, it was not a simple story of like, wow, guys, it took you a long time to come back to market because look at what Rockstar launched. Again, they relaunched and they actually remade the title for PC. They relaunched and remade the title for each new generation. And they launched GTA Online plus other services that were either required or launched to the extent that GTA has become a thriving business that's an ongoing business. So it's not as simple as, wow, what have you been up to for 13 years? The answer is they've been up to quite a lot. And I think one of the reasons that GTA 6 is so widely anticipated is that we now have a GTA ecosystem that Rockstar built.

Doug Kreutz, Analyst — TD Cowen

I would imagine that it's not as simple as saying, oh, let's just pour more resources into Rockstar, that they probably are finding the right people to work in that environment. It's probably not the easiest thing in the world.

Strauss Zelnick, CEO

Look, again, I'm not to name names, but a very big resource-heavy company went into the video game business about, what, 12 years ago, and they've had one title that was moderately successful. It is not about headcount. It is not about technology. I know you'll get to that. It is about the intersection of talent, passion, and resource that creates hits. And so it isn't as simple as let's hire more people. Obviously, you have to hire the right people and then manage them the right way with the right creative vision in the first place and then with daily attention to execution. Yep. Which is ultimately my job, right?

Doug Kreutz, Analyst — TD Cowen

Let's move on to NBA 2K, another very big franchise. You had a tremendous run over the last couple of years, double-digit RCS growth. Can you talk a bit about what... And a huge year this year. Yeah, what they've gotten right to drive all that growth. And you did guide to, I think, 7% growth in the coming fiscal year. What lends you the confidence that you can continue to grow it off of such a tough comp for the last year?

Strauss Zelnick, CEO

So we hate talking about what we got right because I'm a big believer that arrogance is the enemy of continued success. And the team at Visual Concepts, if Greg Thomas were sitting here, he would be happy to tell you all the things that we got wrong and all the things that we need to do better at. And I sort of would dive in. But because I didn't actually create the title, I can complement the team appropriately. I think what they got right is this wonderful intersection of phenomenal sports simulation game with the creation of a culture and the importation enhancement of the world surrounding basketball. and that you have the ability to show up in that title in NBA 2K and NBA online and play the game or engage with the culture of the game or both. And I also think that Greg and his team at Visual Concepts do a great job of listening to the consumer and making sure that enhancements are in service not of enhancing revenue but in service of creating a better experience. if we create a better experience, the revenue should follow. So while we're happy here at an investor conference to talk about setting records for unit sales and revenue-related there, too, and recurrent consumer spending, that comes from meeting the consumer's needs, exceeding their needs, exceeding expectations, and getting up the next day and doing it again. And in certain instances, making changes when we've gotten feedback that, like, no, this isn't what we want. So I think the reason the game has done so well in the past couple of years is it's an amazing game. And just a great, great game. By the way, not the only great game in market. We're running scared at all times. And our friends at EA have the number one sports title worldwide in FC. So we know what the competition has, and we know what we've got to do to continue to win.

Doug Kreutz, Analyst — TD Cowen

Do you feel like there's still a lot of untapped opportunity outside the U.S. with NBA?

Strauss Zelnick, CEO

I mean, basketball is a growth sport. It is going outside. There's no secret that there's a lot of tension around growth in Europe. And we're very optimistic about where European growth could lead, but also growth in developing markets. And that's a broader theme at Take Two, where we're very focused on growing developing markets. So remember, the nature of a multinational interactive entertainment company today, unless you're a Chinese company, is that 80% of your revenue comes out of the U.S., U.K., Western Europe, and little pockets of Asia. And you're not serving at all, you know, in a meaningful way, Russia, Latin America, India, Africa, and the Middle East. And we want to change that. And so we're aggressively building up our international market's presence, which is challenging because it requires you to invest in advance of revenue, something we hate doing, but we are doing that.

Doug Kreutz, Analyst — TD Cowen

Can you talk a bit about opportunity with college basketball that you see?

Strauss Zelnick, CEO

Well, I mean, there was a mode. I think the team at 2K Visual Concepts did a great job getting to market so quickly on college basketball. And the consumers loved it. But it's early days yet. There's much more to come. I think there were 16 or 17 universities represented. It was a really great start.

Doug Kreutz, Analyst — TD Cowen

As a Duke basketball fan, I'm excited to see what you bring. There's more to come, much more to come. Let's talk about some other things that you've talked about coming in the AAA side. You've announced Judas. You've announced Project Ethos. I think you said last week that you would have seven AAA sequels in total in fiscal 28 and 29, which I assume includes the Bioshock sequel that you've talked about. And as you mentioned earlier, you know, Bioshock's been brewing for a long time. Judas, I think you announced in 2022. When you think about value creation of a company beyond GTA, How important are these titles to that?

Strauss Zelnick, CEO

Incredibly important. And I mean, Lainey's sitting here, but I think in the past few years, GTA as a total business has been less than 15% of our overall net bookings, if I have that right. So 85% of the company has not been about GTA. And that is no way to detract from its importance as a title. Obviously, it's to make the note that we're a big, diversified company with lots of hits, and we have half of our business is mobile, of course, and half is console and PC. So our job is to grow in all directions because we're serving consumers everywhere. Every kind of consumer, wherever they are and however they want to engage, that's our job. That's what we're trying to do. That's our mission. And in this past year, past fiscal that we just reported, of course, all of our labels did better than expected. so the the goal is you know not to work on one title at a time right the goal is to build up our business by delivering great hits and to have largely owned intellectual property that we can bring to the consumer over and over again so we have 11 franchises do i have that right that have each sold over 5 million units i think it's sorry it's up to 13 um and you know those when when i showed up here, the number was one, to be clear. It was one. And it's really hard to do. And I'm not really in the business of patting our collective selves on the backs, but no one else has done that. No one else has done that. And we have invested heavily and sometimes had failures and missteps in so doing. But the reason our company is as valuable as it is, is because we have all these franchises that deliver over and over again. And in most instances, actually sell more units with a new iteration than the prior release, not every situation but most, which is a real outlier in the business, and again, a reflection of our willingness to invest behind quality.

Doug Kreutz, Analyst — TD Cowen

I'm sure you've seen some execs and former execs in the last several years have said that they think AAA development costs are becoming unsustainable in terms of the amount of money that has to be poured in and the risk of failure. How do you think about that?

Strauss Zelnick, CEO

They're not wrong. I mean, but it's odd that you would say this, but, you know, the cost of making the best entertainment on earth is actually an entry barrier. And so, you know, you don't want to go up against that from the outside. But when you're in the inside, if you're judicious and you're careful about your capital allocation, one could argue it's actually a benefit because you have fewer high-end competitors. That's reliant upon the fact that the money is well spent, which is to say that you're making hits. So it is a game for the big boys. The entertainment business of maturity is always a top 10 or 20 business, always. And if you think otherwise, you're kidding yourself. It is not a long-tail business. It's a long-tail business when you're in the top 10 business. That's great. We have a terrific catalog. It generates revenue and cash flow year in, year out. We have terrific live services. Generates revenue and cash flow year in, year out. But the locomotive for all that is the front line. and the front line has to include sequels and new intellectual property if you want to be in a more powerful position in 10 or 20 years than you are today. And that's our goal. This management team has never looked at the business quarter to quarter. As you know, I don't. And as you know, we're willing to do things that other people would see as unnatural acts because we don't look at things quarter to quarter. We're building this business for 5, 10, 15, 20 years hence, even though you know the odds of my sitting in the seat in 20 years are reasonably low but hey you never know so the but that's the goal and the reason that we have the market cap we have today is because I looked at that 20 years ago when we had a $700 million market cap I wasn't playing quarter to quarter we've made a lot of really hard decisions and by the way we were in the wilderness for quite some time and then you know we were undervalued for quite some time where people are like is this real and then finally it began to come to fruition but did not happen overnight and now we're in this incredible position of luxury what a terrible shame it would be if we incinerated by now thinking short term so yes we're gonna have to invest a lot of money behind our creative teams if we still want to be delivering the best entertainment on earth we have to be judicious about capital allocation we we we have to be thoughtful and at times we're gonna have to you know take hits because we were wrong. But if we get it right, and I do believe we'll get it right with Grand Theft Auto and with Bioshock and I hope with Ethos and with many other titles, we do get it right with NBA 2K. These are immensely profitable enterprises despite high production costs and high marketing costs.

Doug Kreutz, Analyst — TD Cowen

I've always said to clients, there's no amount of money you can spend on a hit that's too much and no amount of money you can spend on a flop that's too little. That's right. That's just how you have to purchase a business. We try not to spend much on flops.

Strauss Zelnick, CEO

the best thing is like when you put out something that doesn't work and you run it someone this has happened to me also in the movie business more typically but i you know running someone at a cocktail party and they're like why did you make that horrible flop it's like because i thought it was going to be a hit like what do you think i thought like that would be a good idea let's do that even though it's going to be a flop because i thought it was going to be a hit where it's a little more complicated is mobile because you kind of don't know so the way we have addressed that is meaningfully to reduce our exposure pre-launch in mobile. When we took over Zynga, they had a couple of projects that had huge numbers attached to that were legacy projects. We don't do that anymore because the hit ratios are so low in mobile, it just doesn't make sense. And really to focus mightily on fewer than 10 new launches a year in hopes of having one or two hits a year. That strategy has paid off. It's what led to Colorblock Jam and Match Factory and some titles that are doing really well that are somewhat smaller than that. And we hope that we'll be able to do that year in, year out. But what we have done in mobile is gotten out of the business of spending massive amounts of money where the hit ratios just don't bear up. And mobile is essentially a direct marketing business on the marketing side, whereas PC and console releases feel more like brand marketing still. We do a bunch of performance marketing, but when you market a PC or console title, it's a lot like marketing a movie release in the old days for me. Whereas marketing, you know, a mobile title is much more performance, direct marketing. And, you know, I have a whole history in the old-fashioned direct marketing business. And one thing about direct marketing is it's very difficult to predict. It's the data that tells you the answer. So if you're in a situation where you can't predict, like we double down on GTA because we believe, okay, if we get this right, it should do really, really, really well. But you can't double down on a mobile title because the hit ratios are just too low. So I can't tell you the numbers, but, you know, it cost us, I mean, it was like a rounding error to get to market on Colorblock Jam. It was just very, very, very low. Now, then you have to invest in marketing. So equally match factory, it wasn't a rounding error, but it was an inexpensive title. But then we had to really spend on marketing, and we made no bones about it. We were public about it. And it takes a while to get your money back when you do that too.

Doug Kreutz, Analyst — TD Cowen

Yeah, and you had a great year in mobile. You grew 13%.

Strauss Zelnick, CEO

Yeah, Frank Jebeau and the team at Zynga have done a phenomenal job.

Doug Kreutz, Analyst — TD Cowen

You've also, I mean, you talked about your new titles, Toon Blast, which is a much older title.

Strauss Zelnick, CEO

It's 14 years old and just set a record. It's incredible.

Doug Kreutz, Analyst — TD Cowen

Yeah, I mean, what's been the driver of that incredible growth spurt, you know, this long after launch?

Strauss Zelnick, CEO

It's been engaging with the legacy consumers. it's less about DAU growth and much more about engaging with the consumers who love the title and giving them what they want.

Doug Kreutz, Analyst — TD Cowen

Do you feel like, you talked about how much you have to invest in marketing to have a mobile channel, have a chance of success. Is that as much of a barrier to entry on mobile as development costs are for console?

Strauss Zelnick, CEO

It's a great question. And the answer is yes, it really is. So the good news is you can actually, especially the AI. You can develop a mobile title really cheaply and get it to market. But if the payback period for the marketing is two years, and there are companies that think two years is too short. We have direct competitors who spend up to five-year paybacks, as far as we can tell, which we think is insane. But either way, think about what you have to spend to start getting positive cash flow. So the entry barriers are enormous unless you create something that's actually a viral hit, and that doesn't really happen anymore. I mean, there are outliers, but they really are very few and far between. I can't think of one. So our friends at Scopely, for example, spent a massive amount of money on Monopoly Go. Now, it paid off. It's a very profitable title. It's a huge title, but they spent an enormous amount of money supporting the marketing before the money came back. And we spent a lot of money on other titles.

Doug Kreutz, Analyst — TD Cowen

Okay.

Strauss Zelnick, CEO

So yes, it's a huge barrier to entry in mobile. There's a whole little business actually growing up of independent companies that are financing UA for mobile companies. So I don't know if you know this, but they're all private, so I'm not going to help you all out. But there are probably five companies that have raised private capital and they finance UA and then they

Doug Kreutz, Analyst — TD Cowen

take it back off the top. Is there an edge that they are really skilled at it? That's their idea.

Strauss Zelnick, CEO

I mean, if they're not really skilled at it, they're not going to be around very long. But so far, one of the guys doing it that used to work for me is super talented. And it's still a small business because he does have to be very selective, but it's working. You've talked about direct to

Doug Kreutz, Analyst — TD Cowen

consumer is an important margin growth vector for mobile, and we've seen there are some companies that report their DTC as percentage total revenue. It does seem like there's been a big acceleration at companies like Platica in the last year in terms of they're getting up to 40%. How is that going for you, and do you see a lot of continued runway there as a margin growth driver?

Strauss Zelnick, CEO

It's going really well. We are not direct to consumer on every one of our mobile titles, but we're nearly there. We don't talk about the percentage, but it's meaningful. And in fact, if you go back to the comments I made during the Zynga acquisition, when we talk about synergies, and particularly revenue synergies, I outlined as one of the areas of revenue synergy going direct to consumer. And we vastly exceeded our expectations that we laid out at that time. because at that time, direct-to-consumer Edzinga was 0% of their revenue. So it's a whole lot higher than that. At the same time, our strategy is not bring people to our company store to increase margin. Our strategy is to be the best entertainment company on earth by delivering more hits than anyone else and delivering them to consumers where they are and how they want to consume our titles. That's our job. And so if they want to buy stuff from a store, as long as that store treats us fairly and protects our intellectual property, we're going to be in business with that store. I do think that third-party distribution costs will go down, partially for regulatory reasons, partially as a result of litigation, and partially and probably most appropriately as a result of competition. um and but but third-party stores are important to us because they market our titles too and they are really good partners to us so you can't ask someone to be a good partner on the one hand and then grab their wallet on the other hand so we're it's a balance there are consumers who want to engage with us directly great we'll do that there are consumers who want to buy through the store we'll do that just want to be treated fairly when we're at the store do you do you feel like the

Doug Kreutz, Analyst — TD Cowen

third-party distributors are are already becoming better partners because of the pressure that they're seeing from potential losing?

Strauss Zelnick, CEO

Well, they've always actually been really good partners. They've just been pricey partners. And I do think that they're, but I do think third-party distributors understand now that those costs have to come down.

Doug Kreutz, Analyst — TD Cowen

Okay. Just stepping back a bit, there's been a lot of hand-wraining about the video game industry over the last few years. Obviously, there's been a lot of layoffs across the industry, at least a perceived lack of market growth, whether that's true or not.

Strauss Zelnick, CEO

It's actually not the stats I've recently seen from NewZoo, like the growing market.

Doug Kreutz, Analyst — TD Cowen

I mean, I agree, but this is what I hear,

Strauss Zelnick, CEO

and this is what you read the headlines. Well, you're really referring to what Matthew Ball wrote. Yeah, yeah, yeah. But actually, it's not been borne out in what we're seeing. We've done incredibly well, and much as I would love to take full credit for that, I think we have felt industry tailwinds. We really have. We certainly have not felt headwinds. We felt a lot of headwinds in 2022, mid-22, in both mobile and console. but we saw it post-pandemic. That's not what we're seeing now. We're feeling modest tailwinds.

Doug Kreutz, Analyst — TD Cowen

So you feel, if you looked at the next five years where you think the opportunity is for the industry, you feel good about...

Strauss Zelnick, CEO

Oh, my God, and it's breathtaking. And I'll give you two big reasons. Put everything else to the side. Streaming and developing markets. Those are two areas of focus for us. So will streaming technology bring PC content to consumers who previously couldn't get it because they didn't have PCs? You bet. What is a big barrier? It's obviously latency. And there are numerous companies, both domestically and internationally, that are addressing that. And in the U.S., I think it will be edge network driven. Outside of the U.S., it will be driven by things like Starlink. And it won't work for every title, but it will work for some. And it certainly does not mean, you know, if you've got whatever, you know, I don't know, there are 8 billion people and you've got like 2 or 3 billion phones and you've got a stall base of console of under 200 million, it does not mean you're in a 10x the market, obviously, because avid consumers are in the console business or in the PC business. It does mean, though, that I think you're going to meaningfully address consumers who previously could not consume your products. So streaming should be really huge for us. And then the second thing, as I mentioned earlier, developing markets. We've got well over a billion people that we can serve in India that we do not serve now, just by way of one example. 500 million people in the Middle East. So we do serve the Middle East, but not as effectively as we aim to do in the future. So we can't have

Doug Kreutz, Analyst — TD Cowen

a TMT conference these days without discussing AI. Nope.

Strauss Zelnick, CEO

By the way, I got invited to a dinner, and it was like one of these think tank dinners. It was like, would you please come to dinner on June, blah, blah, blah, a small group of people to talk about AI. And I am a very polite person, which you know. And generally, I would say, I'm sorry, thank you very much for the invitation, but I can't make it. But I just couldn't help myself, I wrote back and I said, I can't spend five minutes having another discussion about AI, but thank you for the invitation. I did actually say that. I said, cannot do it. And clearly the person I sent it to did not read the response. Like, oh, you'll come on another occasion. Not to discuss AI, I won't. But anyway, I'm going to. We only have 25 seconds left. Thank the Lord. I've never liked a clock so much. Yes, yes. Please, go ahead.

Doug Kreutz, Analyst — TD Cowen

An executive in other company I cover said that AI is ultimately going to allow a team of three people to develop a GTA a TTA class game within a week. What's your view on that statement?

Strauss Zelnick, CEO

Wouldn't that be great for us? No, that's not tongue-in-cheek. Anything that, you know, we have three-part strategy, be the most creative, be the most efficient, be the most innovative. And if we have tools that allow us to be more innovative, more efficient, and more creative, we're all in. That's what we've used tools for before. I think the problem with the conclusion that people reach when the executive says that is, and therefore, they will make a hit that's as big as GTA. and there's zero evidence for that because we've had technology forever that would allow people to recreate what we do. Maybe it's not done in a week, but who cares? Given how much GTA is worth, if you could make something that's as good as GTA and performs as well, would it bother you that it currently takes 13 years? Of course not. Like, why wouldn't you do that? So, and people have tried. Anyone run into Assassin's Creed? I mean, people have tried to make titles that competed directly with GTA. And by the way, this isn't by way of my saying, no one could ever compete with us to the contrary I'm simply saying that the ability to use tools to create intellectual property is totally different than creating hits it's just a different exercise and you know there anyone see the 007 early reviews and early scores like it was done by my friend Casper Daugard and his team and it looks phenomenal looks great and they're outside of the major studio system that is absolutely possible to make something of great quality, and if tools allow you to do that, great, but they'll also allow us to increase our quality and increase our efficiency. Making a hit is different than making an asset. They're just different things, and I have no doubt that technology is going to allow us to make better assets more efficiently. That's the history of technology, but making hits, making hits seems to get harder and harder and harder as entertainment industries mature. We do not have a monopoly in hit creation. As I said earlier, arrogance is the enemy of continued success. I don't believe for a minute that technological advances give someone else an edge or give us an edge. It's just the tool set. It's available to everyone. And the key thing is that all of this is going to be totally commoditized. Show me one AI company, just one, just one, who's offering their services or products to companies on an exclusive basis. They don't exist. So when that executive has that button to push, I'll have the same damn button. And the folks at Rockstar seem to be able to make these massive hits. And lots of other people have tried, lots and lots, including former Rockstar employees. And so far, they haven't been able to do it. It doesn't mean they can't in the future, by the way. We're always running scared. But it won't be technology that changes the game. That won't be the change. What will change is that some extraordinarily creative individual or individuals are going to show up and do something astonishing. Our goal is to get those people to work within the Take-Two system. If we fail to do that, we fail. If we continue to be the home of creativity, the company that welcomes and encourages and supports and finances the best talent in the business, then the rest will take care of itself. And technology is in service of those goals, not at odds with them.

Doug Kreutz, Analyst — TD Cowen

That's great.

Strauss Zelnick, CEO

I don't think that was five minutes thank you so much thanks for having it yes thanks so much