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

The analysis of the provided financial ratios over the six-year period reveals several notable trends and patterns related to asset utilization and equity efficiency.

Net Fixed Asset Turnover

This ratio shows a consistent decline from 23.42 in 2020 to 12.69 projected for 2025. The decrease suggests a diminishing efficiency in generating sales revenue from fixed assets, indicating either increasing fixed asset bases without proportional revenue growth or declining sales relative to asset investments.

Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)

Similar to the standard net fixed asset turnover, this adjusted ratio shows a downward trend from 10.79 in 2020 to 7.32 in 2025. The inclusion of right-of-use assets for leases reveals a lower turnover level, consistently declining over the years, reflecting reduced efficiency in asset use when considering leased assets.

Total Asset Turnover

This ratio declines from 0.62 in 2020 to a low of 0.34 in 2023 before improving to 0.61 by 2025. The initial drop suggests declining efficiency in using total assets to generate revenue during 2021–2023, followed by a recovery in turnover ratios toward the end of the period, indicating an improvement in asset utilization or an increase in sales relative to assets.

Equity Turnover

Equity turnover demonstrates a decreasing trend from 1.22 in 2020 to 0.59 in 2023, indicating lower sales generation relative to shareholder equity during this period. However, a significant increase is projected thereafter, reaching 2.64 by 2025. This sharp rise could imply a substantial boost in sales or more efficient use of equity capital in generating revenue in later years.

Overall, the data depict a general reduction in fixed asset efficiency and an initial decline in overall asset and equity turnover ratios, followed by marked improvements projected in the later years, particularly for equity turnover and total asset turnover. This suggests a period of adjustment or investment expansion early in the timeline, with a recovery phase characterized by enhanced utilization and sales growth relative to both assets and equity capital toward the end of the period.

The financial data reveals several notable trends over the reviewed periods.

Net Revenue

There is a clear upward trajectory in net revenue, rising from approximately 3.09 billion US dollars in 2020 to about 5.63 billion US dollars projected for 2025. The most significant increase appears between 2022 and 2023, where net revenue jumped from 3.5 billion to over 5.3 billion US dollars, indicating a substantial growth phase. Following this jump, the revenue stabilizes with moderate growth in subsequent years.

Fixed Assets, Net

Net fixed assets have increased consistently over the periods, starting at around 132 million US dollars in 2020 and growing to approximately 444 million US dollars by 2025. The most rapid growth occurred between 2021 and 2023, where net fixed assets nearly tripled, signaling significant capital investment or asset acquisitions during this time frame.

Net Fixed Asset Turnover

The net fixed asset turnover ratio shows a declining trend throughout the periods, decreasing from 23.42 in 2020 to 12.69 in 2025. This ratio measures the efficiency in using fixed assets to generate revenue. The steady decline suggests that although fixed assets increased substantially, the revenue generated per unit of fixed asset value has decreased, possibly indicating diminishing returns on asset investments or a change in asset utilization efficiency.

Overall, the company demonstrates strong revenue growth accompanied by considerable increases in fixed assets. However, the declining asset turnover ratio suggests a need for management to evaluate asset utilization strategies to maintain or enhance operational efficiency.

Net Revenue

Net revenue demonstrates an overall upward trend from 2020 through 2025. Starting at approximately $3.09 billion in 2020, revenue gradually increased to about $3.50 billion by 2022, then experienced a significant jump to nearly $5.35 billion in 2023. Revenue levels in 2024 remained stable compared to 2023, followed by a moderate increase projected for 2025 to approximately $5.63 billion. This pattern indicates sustained growth with a marked acceleration beginning in the fiscal year 2023.

Fixed Assets, Net (including operating lease, right-of-use asset)

Net fixed assets also exhibit a consistent increasing trend over the period. The asset base rose from about $286 million in 2020 to $459 million in 2022. This growth continued more sharply in 2023, reaching approximately $686 million, and further increased modestly in the following two years to an estimated $770 million by 2025. The rising fixed asset values suggest ongoing investment in property, plant, equipment, or leased assets throughout the years examined.

Net Fixed Asset Turnover (including operating lease, right-of-use asset)

The net fixed asset turnover ratio, which measures the efficiency of using fixed assets to generate revenue, shows a declining trend from 2020 to 2025. Starting at approximately 10.79 in 2020 and remaining stable near 10.74 in 2021, the ratio decreased more substantially to around 7.63 in 2022. It then experienced a slight recovery to 7.80 in 2023, but declined again in 2024 and 2025 to roughly 7.26 and 7.32, respectively. This decline suggests that while fixed assets are growing, their relative efficiency in generating revenue is diminishing compared to earlier periods.

Net Revenue

Net revenue exhibited a consistent upward trend from March 31, 2020, to March 31, 2025. Starting at approximately $3.09 billion in 2020, it increased moderately each year until 2022, reaching around $3.50 billion. A significant jump is observed in 2023, with revenue rising to approximately $5.35 billion, followed by a slight stabilization in 2024, and a further modest increase projected for 2025, reaching nearly $5.63 billion.

Total Assets

Total assets show notable growth until 2023, increasing from around $4.95 billion in 2020 to a peak of approximately $15.86 billion in 2023. However, this is followed by a decline in asset value in subsequent years, falling to roughly $12.22 billion in 2024 and further down to about $9.18 billion in 2025. This pattern indicates a major expansion in assets leading up to 2023, with asset consolidation or divestiture occurring thereafter.

Total Asset Turnover

Total asset turnover ratio demonstrates a downward trend from 0.62 in 2020 to a low of 0.34 in 2023, suggesting reduced efficiency in generating revenue from assets during this period. Subsequently, there is a recovery in the ratio, rising to 0.44 in 2024 and further to 0.61 in 2025, indicating a return to improved asset utilization.

Summary of Trends

The company's revenue growth outpaced asset growth initially, but the sharp increase in total assets in 2023 was not matched by corresponding revenue growth, as highlighted by the drop in total asset turnover ratio. The subsequent reduction in asset base alongside revenue stabilization and improved asset turnover suggests a strategic realignment towards more efficient asset use. Overall, the data reflects a phase of rapid expansion followed by asset optimization and improved operational efficiency.

The financial data over the period reveals several noteworthy trends in revenue, equity, and operational efficiency as measured by equity turnover.

Net Revenue

Net revenue demonstrated a generally increasing trend from March 31, 2020, through March 31, 2025. Starting at approximately US$3.09 billion in 2020, revenues increased moderately in 2021 and 2022. A significant jump occurred in 2023, reaching about US$5.35 billion, and this elevated level was mostly maintained with moderate growth continuing into 2024 and 2025, peaking at approximately US$5.63 billion. This suggests a period of accelerated top-line growth beginning in 2023.

Stockholders’ Equity

Equity levels showed robust growth from 2020 to 2023, increasing from roughly US$2.54 billion in 2020 to a sharp peak of about US$9.04 billion in 2023. However, this peak was followed by a marked decline, dropping to approximately US$5.67 billion in 2024 and further down to about US$2.14 billion in 2025. The spike followed by a rapid contraction indicates possible significant equity transactions, including capital restructuring, share buybacks, or other financial activities affecting shareholder funds.

Equity Turnover

The equity turnover ratio, which measures revenue generated per unit of equity, displayed a general decline from 1.22 in 2020 to 0.59 in 2023, reflecting a decrease in revenue generation efficiency relative to equity. This aligns with the sharp increase in equity in 2023, which outpaced revenue growth. Subsequently, equity turnover rebounded strongly in 2024 and grew substantially to 2.64 in 2025, indicating a far more efficient use of equity to generate revenue, coinciding with the reduction in equity levels after the 2023 peak.

Overall, the data reflect a phase of rapid expansion in equity accompanied by steady revenue growth until 2023, followed by a substantial reduction in equity and a marked increase in revenue efficiency. The interplay between equity size and net revenue generation efficiency is a critical aspect of the recent financial development.