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

Receivables Turnover

The receivables turnover ratio demonstrates an overall upward trend from 5.21 in 2020 to a peak of 7.87 in 2024, followed by a slight decline to 7.31 in 2025. This indicates an improvement in the efficiency of collecting receivables until 2024, suggesting enhanced credit management, with a minor reduction in efficiency in the last reported year.

Payables Turnover

The payables turnover ratio exhibits significant fluctuations over the periods. Starting at 23.48 in 2020, it declines to 12.2 in 2022 before partially recovering to 21.87 in 2023. Subsequently, it decreases again to 15.86 in 2024 and further to 13.21 in 2025. These variations imply inconsistent payment patterns to suppliers, with periods of slower payables turnover indicating extended payment terms or delayed payments.

Working Capital Turnover

Working capital turnover shows an initial decrease from 2.12 in 2020 to 1.7 in 2021, then a recovery to 1.98 in 2022. Data is unavailable beyond 2022, restricting a comprehensive trend analysis. However, the fluctuations point to some variability in the effectiveness of utilizing working capital to generate revenue within the observed timeframe.

Average Receivable Collection Period

The average receivable collection period steadily decreases from 70 days in 2020 to 46 days in 2024, with a slight increase to 50 days in 2025. This decreasing trend supports the improvement seen in receivables turnover, reflecting a faster collection of receivables and thus better cash conversion cycles. The minor increase in 2025 suggests a slight slowdown in collections.

Average Payables Payment Period

The average payables payment period experiences considerable variation, increasing from 16 days in 2020 to 30 days in 2022, then decreasing to 17 days in 2023, and rising again to 23 days and 28 days in 2024 and 2025 respectively. These fluctuations indicate changes in payment strategies, with periods of extended payment terms potentially improving cash retention, alternating with shorter payment periods.

The financial data over the specified periods reveals several notable trends in revenue and receivables management. Net revenue exhibits a clear upward trajectory, increasing consistently from approximately $3.09 billion in the fiscal year ending March 31, 2020, to a peak of about $5.35 billion by March 31, 2023. Although the revenue stabilizes between the fiscal years 2023 and 2024, it resumes a growth trend by March 31, 2025, reaching approximately $5.63 billion. This overall rising trend indicates sustained growth in sales or service income over the analyzed period.

Accounts receivable, net of allowances, shows variability but generally increases over the period. Beginning at approximately $593 million in 2020, the figure shows modest fluctuations through 2022, followed by a sharp increase to around $763 million in 2023. A decrease occurs in 2024 to roughly $680 million, but the balance rises again by 2025 to about $771 million. These movements suggest adjustments in credit policies or changes in customer payment patterns, with an overall increase indicative of a larger volume of sales made on credit or slower collections in recent years.

Receivables turnover ratio, which measures the efficiency with which accounts receivable are collected, demonstrates an improving trend over time, rising from 5.21 times in 2020 to a peak of 7.87 times in 2024, with a slight dip to 7.31 in 2025. The upward trend in turnover ratio signifies enhanced collection efficiency and potentially better credit management practices, allowing the company to convert its receivables into cash more rapidly. The slight decline in 2025 may warrant attention but remains above earlier years' levels, suggesting continued effective management of receivables.

Net Revenue

Consistent growth from US$3.09 billion in 2020 to US$5.63 billion in 2025, with a plateau between 2023 and 2024.

Accounts Receivable, Net

Overall increasing trend with fluctuations, rising from about US$593 million in 2020 to US$771 million in 2025, indicating higher credit sales or altered collection dynamics.

Receivables Turnover Ratio

Improvement over the period from 5.21 times to 7.31 times, reflecting enhanced efficiency in collecting receivables despite a minor decline in the final year.

The cost of revenue exhibits a generally stable trend from March 31, 2020, to March 31, 2022, remaining slightly above 1.5 billion US dollars. However, there is a pronounced increase in this figure in the fiscal year ending March 31, 2023, reaching over 3 billion US dollars. Although there is a slight uptick again on March 31, 2024, nearing the previous year's peak, the cost of revenue decreases notably in the following year ending March 31, 2025, dropping to approximately 2.57 billion US dollars. This indicates a significant and unusual spike in expenses related to revenue production in the years 2023 and 2024, followed by a partial retraction in 2025.

Accounts payable display a steady growth trend from 65.7 million US dollars in 2020 to nearly 196 million US dollars by 2024, with an insignificant decline in 2025 to 194.7 million US dollars. This suggests an increasing reliance on credit extended by suppliers or vendors over the analyzed period, with a peak in the most recent full year and a marginal decrease thereafter.

The payables turnover ratio, indicating how effectively the company manages its accounts payable, fluctuates notably. It starts at a relatively high 23.48 in 2020, experiencing a decline over the next two years to a low of 12.2 in 2022. Subsequently, there is a rebound to 21.87 in 2023, followed by decreases in 2024 and 2025 to 15.86 and 13.21, respectively. These variations suggest inconsistent payment practices or changing credit terms throughout the period, with the ability to manage payables most efficiently in 2020 and 2023, but less so in other years.

Summary of Key Trends

The cost of revenue experienced a major increase in 2023 and 2024 before decreasing in 2025.

Accounts payable have generally increased, reaching their highest levels in 2023 and 2024, slightly declining in 2025.

The payables turnover ratio shows volatility, with efficient management in certain years and less efficient management in others, particularly dipping in 2022 and into 2025.

Working Capital

The working capital experienced an initial increase from 1,454,812 thousand US dollars in 2020 to a peak of 1,985,800 thousand US dollars in 2021, indicating an improvement in the company's short-term liquidity and operational efficiency. However, from 2022 onwards, working capital declined significantly, turning negative at -1,343,500 thousand US dollars in 2023, and remaining negative through 2024 and 2025 with values of -146,700 and -799,900 thousand US dollars respectively. This downward trend suggests potential liquidity challenges and a decrease in current assets relative to current liabilities over the latter periods.

Net Revenue

Net revenue showed a consistent upward trend throughout the periods analyzed. It increased from 3,088,970 thousand US dollars in 2020 to 3,502,800 thousand US dollars in 2022, followed by a substantial jump to approximately 5,349,900 thousand US dollars in both 2023 and 2024, maintaining this high level into 2025 at 5,633,600 thousand US dollars. The marked increase beginning in 2023 indicates significant growth in the company's sales or service income, reflecting possibly enhanced market demand or successful business expansion strategies.

Working Capital Turnover

The working capital turnover ratio, which measures how effectively the company is using its working capital to generate sales, decreased from 2.12 in 2020 to 1.7 in 2021, indicating a slight reduction in efficiency. It recovered somewhat to 1.98 in 2022. No data is available for subsequent years, but given the negative working capital reported in those years, it is likely that the ratio could be adversely affected if calculated, suggesting less efficient use of working capital during that period.

Receivables Turnover

The receivables turnover ratio has shown a generally upward trend from 5.21 in March 2020 to a peak of 7.87 in March 2024, indicating an improvement in the efficiency of collecting receivables over this period. However, there is a slight decline to 7.31 in March 2025, suggesting a minor reduction in collection efficiency in the most recent year.

Average Receivable Collection Period

The average collection period has steadily decreased from 70 days in March 2020 to 46 days in March 2024, reflecting faster collection of receivables and improved cash flow management. There is a slight increase to 50 days in March 2025, which corresponds with the slight decline observed in the receivables turnover ratio for the same year.

Overall Trend and Insights

Overall, the data indicates significant improvement in receivables management from 2020 through 2024, with faster collections and higher turnover ratios. The minor reversals in these trends in 2025 warrant monitoring but do not negate the prior years’ progress in enhancing working capital efficiency.

Payables Turnover

The payables turnover ratio demonstrates variability over the observed periods. Initially, it decreased from 23.48 in March 2020 to 21.62 in March 2021, followed by a significant decline to 12.2 in March 2022. Subsequently, it increased to 21.87 in March 2023 but declined again in the following years to 15.86 and then 13.21 by March 2025. This fluctuation suggests inconsistency in the frequency of payables being paid during the years, with a notable reduction in turnover activity around 2022 and a downward trend in the last two periods.

Average Payables Payment Period

The average payables payment period also displays considerable fluctuations. It increased from 16 days in March 2020 to 17 days in March 2021, then sharply rose to 30 days in March 2022. Following this peak, the payment period shortened to 17 days in March 2023 but lengthened again in the subsequent years to 23 days in March 2024 and further to 28 days in March 2025. The data indicates a pattern of payment delays averaging longer durations in some years, particularly in 2022 and the last two years, aligning inversely with the payables turnover ratio trend.

Relationship and Insights

The inverse relationship between the payables turnover and the average payables payment period is apparent. When the payment period increases, the payables turnover ratio tends to decrease, reflecting slower payment cycles. The marked increase in days payable during 2022 and the last two periods corresponds with a reduction in payables turnover, suggesting the company stretched its payable terms or experienced delays in payments during these times. Such trends could have implications for supplier relationships and cash flow management.