Take-Two Interactive Software Inc. (NASDAQ:TTWO) Q4 2019 Earnings Conference Call Transcript

May 13, 2019 • 04:30 pm ET

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Take-Two Interactive Software Inc. (NASDAQ:TTWO) Q4 2019 Earnings Conference Call Transcript

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Q & A
Operator
Operator

Thank you. Ladies and gentlemen, at this time, we will be conducting the question-and-answer session. (Operator Instructions)

Our first question comes from the line of Tim O'Shea with Jefferies. Please proceed with your question .

Analyst
Tim O'Shea

Yes. So thank you for taking my question. My question is about how you think about the free-to-play model. You've obviously had great success selling games for full price. I mean, I think Strauss mentioned 110 million units of GTA V, 24 million units of Red Dead, but for services like Red Dead Online, it seems like a large audience is key. I'm curious, if there is a point where these services could be decoupled from the full priced version of the game, so a player could still purchase Red Dead for $60, but could play Red Dead Online for free. Just love to hear any thoughts on free-to-play. Thank you.

Executive
Strauss Zelnick

Well, I think it's a great question and clearly when you have the right title like a Fortnite or Apex Legends, free-to-play can be a powerful model. We also have some great free play games NBA 2K Online in (ph) China with 45 million registered users and recurrent consumer spending was up over 70% in the fiscal year. So we've -- and WWE SuperCard has been downloaded over 19 million times and that's up, net of platform fees I think 13% in the fiscal year. So we have numerous games here that are free-to-play. Social Point's entire business is a free-to-play business.

That said, I don't really see the business transitioning to a free-to-play model, primarily, because the hit ratios are so very low and the hit ratios for our core business are exceedingly high, because of our attention to quality or at least that's what we attribute it to something like 80% plus hit ratios is pretty unheard of in the entertainment business broadly.

In terms of your broader question, which is could you imagine a situation, where in maturity you decouple one experience from another, I think the answer is we tend to be very flexible about business models over time and we want to be where the consumer is. Those business model decisions when they -- with regard to a particular title are driven by our labels although, we all are a pretty tight knit group and consult with one another, but you'd want to look to our labels for any updates on how business models might shift. I think the answer is we're open-minded, we want to deliver to the consumer on an ongoing basis.

Analyst
Tim O'Shea

Thanks.

Operator
Operator

Thank you. Our next question comes from the line of Mike Olson with Piper Jaffray. Please proceed with your question .

Analyst
Mike Olson

Hey, good afternoon. I realized you let Rockstar speak for itself related to new content, but just conceptually, can you say if it would make sense to see a content drop of some sort that's coincident with the timing of Red Dead Online coming out of beta or should we -- I guess not