Stock Analysis on Net

Take-Two Interactive Software Inc. (NASDAQ:TTWO)

$24.99

Economic Value Added (EVA)

Microsoft Excel

EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

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Economic Profit

Take-Two Interactive Software Inc., economic profit calculation

US$ in thousands

Microsoft Excel
12 months ended: Mar 31, 2025 Mar 31, 2024 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020
Net operating profit after taxes (NOPAT)1
Cost of capital2
Invested capital3
 
Economic profit4

Based on: 10-K (reporting date: 2025-03-31), 10-K (reporting date: 2024-03-31), 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= × =


Net Operating Profit after Taxes (NOPAT)

Take-Two Interactive Software Inc., NOPAT calculation

US$ in thousands

Microsoft Excel
12 months ended: Mar 31, 2025 Mar 31, 2024 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020
Net income (loss)
Deferred income tax expense (benefit)1
Increase (decrease) in allowances2
Increase (decrease) in deferred revenue3
Increase (decrease) in equity equivalents4
Interest expense
Interest expense, operating lease liability5
Adjusted interest expense
Tax benefit of interest expense6
Adjusted interest expense, after taxes7
Interest income
Investment income, before taxes
Tax expense (benefit) of investment income8
Investment income, after taxes9
Net operating profit after taxes (NOPAT)

Based on: 10-K (reporting date: 2025-03-31), 10-K (reporting date: 2024-03-31), 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in allowances.

3 Addition of increase (decrease) in deferred revenue.

4 Addition of increase (decrease) in equity equivalents to net income (loss).

5 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =

6 2025 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =

7 Addition of after taxes interest expense to net income (loss).

8 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =

9 Elimination of after taxes investment income.


Net Income (Loss)
Net income demonstrated notable fluctuations over the six-year period. Initially, the company experienced an increase from $404,459 thousand in 2020 to a peak of $588,886 thousand in 2021. However, in 2022 net income declined to $418,022 thousand. Starting in 2023, the trend reversed sharply into negative territory, with losses of $1,124,700 thousand, which further deepened significantly in 2024 and 2025 to $3,744,200 thousand and $4,478,900 thousand respectively. This indicates a substantial deterioration in profitability during the latter years.
Net Operating Profit After Taxes (NOPAT)
NOPAT followed a similar pattern as net income, indicating alignment in operating performance and overall profitability. It rose from $331,110 thousand in 2020 to a high of $782,700 thousand in 2021, followed by a decline to $410,045 thousand in 2022. From 2023 onward, NOPAT turned negative and worsened substantially, reaching -$1,240,989 thousand in 2023, then declining further to -$3,779,593 thousand in 2024 and -$4,540,136 thousand in 2025. This reflects not only a reduction in operating efficiency but also an increasing operating loss burden.
Overall Trend and Insights
Both net income and NOPAT reveal a trajectory of initial growth followed by a steep decline culminating in sizeable losses in the recent years. The peak performance year was 2021, after which profitability metrics declined sharply. The progression into negative results and the magnitude of losses in the last three years suggest significant challenges impacting earnings and operating outcomes. The consistent pattern between net income and NOPAT changes indicates that these losses are driven by core operational issues rather than solely one-off or non-operating items. This financial trajectory may warrant further detailed investigation into the underlying causes and the sustainability of the company’s operations.

Cash Operating Taxes

Take-Two Interactive Software Inc., cash operating taxes calculation

US$ in thousands

Microsoft Excel
12 months ended: Mar 31, 2025 Mar 31, 2024 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020
Provision for (benefit from) income taxes
Less: Deferred income tax expense (benefit)
Add: Tax savings from interest expense
Less: Tax imposed on investment income
Cash operating taxes

Based on: 10-K (reporting date: 2025-03-31), 10-K (reporting date: 2024-03-31), 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31).


Provision for (benefit from) income taxes
The provision for income taxes shows notable volatility over the periods analyzed. Initially, the provision increased from 53,980 thousand USD in 2020 to a peak of 88,930 thousand USD in 2021, followed by a significant decrease to 47,376 thousand USD in 2022. A marked shift occurs in 2023, with a sizable negative provision of -213,400 thousand USD, indicating a benefit rather than a charge. This is followed by a reversal back to a positive provision, 41,400 thousand USD in 2024, and a slight reduction to -12,400 thousand USD in 2025, suggesting fluctuations in taxable income or tax strategies impacting the provision.
Cash operating taxes
Cash operating taxes exhibited an increasing trend up to 2021, growing from 32,663 thousand USD in 2020 to 51,128 thousand USD in 2021. Subsequently, a decrease is observed in 2022 to 37,943 thousand USD. However, a substantial surge occurs in 2023, with cash taxes rising to 195,321 thousand USD, sustaining elevated levels in the following years with 163,663 thousand USD in 2024 and 145,564 thousand USD in 2025. This pattern suggests increased cash tax payments possibly driven by growing taxable income or changes in tax regulations or payments timing.

Invested Capital

Take-Two Interactive Software Inc., invested capital calculation (financing approach)

US$ in thousands

Microsoft Excel
Mar 31, 2025 Mar 31, 2024 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020
Short-term debt, net
Long-term debt, net
Operating lease liability1
Total reported debt & leases
Stockholders’ equity
Net deferred tax (assets) liabilities2
Allowances3
Deferred revenue4
Equity equivalents5
Accumulated other comprehensive (income) loss, net of tax6
Adjusted stockholders’ equity
Short-term investments7
Invested capital

Based on: 10-K (reporting date: 2025-03-31), 10-K (reporting date: 2024-03-31), 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of allowance for doubtful accounts receivable.

4 Addition of deferred revenue.

5 Addition of equity equivalents to stockholders’ equity.

6 Removal of accumulated other comprehensive income.

7 Subtraction of short-term investments.


Total reported debt & leases
The total reported debt and leases exhibit a significant upward trend over the analyzed periods. Starting at approximately 177 million USD in 2020, this figure increased gradually to about 250 million USD by 2022. Thereafter, a pronounced surge is observed, with the amount rising sharply to around 3.49 billion USD in 2023 and continuing to escalate to over 4.1 billion USD by 2025. This dramatic increase indicates a substantial expansion in the company's leverage and long-term commitments during the latter years.
Stockholders’ equity
Stockholders' equity shows a rising trend from 2020 through 2023, increasing from approximately 2.54 billion USD to a peak of about 9.04 billion USD. However, this peak is followed by a marked decline in the subsequent years, with equity falling to roughly 5.67 billion USD in 2024 and further decreasing to approximately 2.14 billion USD by 2025. This volatility suggests significant fluctuations in retained earnings, asset revaluations, or capital changes occurring within this period.
Invested capital
Invested capital demonstrates growth from 2020 to 2023, rising from near 2.83 billion USD to a high of about 14.06 billion USD. After this peak, invested capital decreases notably to around 7.7 billion USD by 2025. The substantial rise and subsequent decline reflect notable changes in the company's total capital employed in operations, likely influenced by the patterns observed in both debt levels and equity.

Cost of Capital

Take-Two Interactive Software Inc., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, net3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2025-03-31).

1 US$ in thousands

2 Equity. See details »

3 Debt, net. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, net3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2024-03-31).

1 US$ in thousands

2 Equity. See details »

3 Debt, net. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, net3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2023-03-31).

1 US$ in thousands

2 Equity. See details »

3 Debt, net. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, net3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2022-03-31).

1 US$ in thousands

2 Equity. See details »

3 Debt, net. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, net3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2021-03-31).

1 US$ in thousands

2 Equity. See details »

3 Debt, net. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt, net3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2020-03-31).

1 US$ in thousands

2 Equity. See details »

3 Debt, net. See details »

4 Operating lease liability. See details »


Economic Spread Ratio

Take-Two Interactive Software Inc., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel
Mar 31, 2025 Mar 31, 2024 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020
Selected Financial Data (US$ in thousands)
Economic profit1
Invested capital2
Performance Ratio
Economic spread ratio3
Benchmarks
Economic Spread Ratio, Competitors4
Alphabet Inc.
Comcast Corp.
Meta Platforms Inc.
Netflix Inc.
Walt Disney Co.

Based on: 10-K (reporting date: 2025-03-31), 10-K (reporting date: 2024-03-31), 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31).

1 Economic profit. See details »

2 Invested capital. See details »

3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =

4 Click competitor name to see calculations.


Economic Profit Margin

Take-Two Interactive Software Inc., economic profit margin calculation, comparison to benchmarks

Microsoft Excel
Mar 31, 2025 Mar 31, 2024 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021 Mar 31, 2020
Selected Financial Data (US$ in thousands)
Economic profit1
 
Net revenue
Add: Increase (decrease) in deferred revenue
Adjusted net revenue
Performance Ratio
Economic profit margin2
Benchmarks
Economic Profit Margin, Competitors3
Alphabet Inc.
Comcast Corp.
Meta Platforms Inc.
Netflix Inc.
Walt Disney Co.

Based on: 10-K (reporting date: 2025-03-31), 10-K (reporting date: 2024-03-31), 10-K (reporting date: 2023-03-31), 10-K (reporting date: 2022-03-31), 10-K (reporting date: 2021-03-31), 10-K (reporting date: 2020-03-31).

1 Economic profit. See details »

2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted net revenue
= 100 × ÷ =

3 Click competitor name to see calculations.