How much does Grand Theft Auto 6 mean for Take-Two Interactive?

Take-Two Interactive’s (Take-Two Interactive Software Stock Quote, Chart, News, Analysts, Financials NASDAQ:TTWO) near-term guidance may be conservative, but the real game-changer lies just ahead, according to Roth Capital Partners analyst Eric Handler.

In a May 19 report, Handler said the company’s fiscal 2026 outlook underwhelms on the surface, mainly due to the delay of Grand Theft Auto VI, but the expected surge in earnings and free cash flow starting in FY27 is where investor attention should be focused.

Handler is maintaining his ‘Buy’ rating with a 12-month price target of $265.00.

“Take-Two reported largely in line 4QFY25 results and issued FY26 guidance that was a bit underwhelming, but likely very conservative,” Handler said. “The real story lies in the expected step-up in EPS and FCF starting in FY27 with the release of GTA VI, which is likely to have a lasting impact well into FY28. PT remains $265, based on 27x our two-year average EPS (FY27-FY28) of $9.92.”

Take-Two reported fourth-quarter fiscal 2025 bookings of $1.582-billion, up 17% year-over-year and slightly above both the firm’s and Wall Street’s expectations. Earnings per share came in at $1.08, nearly triple from a year ago, matching the firm’s estimate and just below the $1.10 consensus. Strong growth in recurrent consumer spending (RCS), up 14%, helped drive the result, well ahead of the firm’s forecast for 3% growth.

“RCS strength came from NBA 2K (+42%). Mobile also topped projections (+3% vs our -4% forecast), driven by Toon Blast (+7%), Match Factory, and Color Block Jam,” Handler said. “Operating margin of 16.0% was up 1,060bps from last year, but came in below our forecast of 17.2%, primarily attributable to higher than expected S&M and R&D expenses.”

Handler said that because GTA VI has been delayed to fiscal 2027, the firm has lowered its fiscal 2026 outlook. It now expects bookings of $6.0-billion, up 6% from the previous year, and earnings per share of $2.70, an 8% increase. That’s down from its earlier forecast of $8.5-billion in bookings and $8.20 in EPS.

“We were a bit disappointed with the lack of operating margin uplift in FY26 (we are at 11.4%) from 10.9% in FY25, especially with the high-profile launches of franchise titles Mafia: The Old Country (8/8 release) and Borderlands 4 (9/12 release).”

Looking ahead, much of the long-term growth forecast hinges on the anticipated launch of Grand Theft Auto VI, which headlines Take-Two’s slate of 25 titles expected between FY27 and FY28. “All eyes are on GTA VI,” Handler said, with the game set for release on May 26, 2026.

“The game’s recently released second trailer shattered records with 475 million views in 24 hours, pointing to the substantial pent-up demand.”

Roth estimates GTA VI could sell 40 million units in its first year, outpacing GTA V’s>34 million launch-year sales, and expects continued momentum in FY28 from the likely release of a PC version and a relaunch of GTA Online.

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