TTWO
#Listen, I have all the respect in the world for Leslie and for everyone else here, current and former colleagues.
And of course I wish him all the best.
I can't comment on his plans.
So we are excited about the pipeline.
We have made some announcements, of course, about upcoming titles.
We talked a bit about XCOM 2, which is coming very soon and has gotten great reviews so far.
We're really excited about that.
That's coming from Firaxis.
We have Battleborn coming in May, which will have powerful single-player and multiplayer approach.
This comes to the market from Gearbox, the people who brought us Borderlands.
And they're immensely talented folks, and we have high hopes.
We've talked about Mafia III coming in calendar 2016.
And, of course, we have basketball and wrestling in our catalog.
We have NBA 2K Online in China.
We've launched Civilization Online in Korea.
We have GTA Online ongoing and performing super well.
And we have our catalog.
So the good news is we have a backdrop of this Company against which to populate additional titles.
We have not announced our full release schedule.
We have not talked about the year after next.
What we have been willing to say, though, is we have an enterprise now which is solid, well financed, highly creative, stable, and rational.
And that enterprise is yielding great results year in and year out ---+ results that generate high revenues, blazing trails in digital distribution and recurring consumer spending, high profitability and strong cash conversion.
We have over $1.2 billion of cash.
Because of the way we account for our convert, we have no debt in that context.
So I do have to give that background.
I know the market would love it if we would talk about titles coming up in the next couple of years, but we make our announcements in an effort to market our titles most effectively.
And that's proven to be a sound strategy.
And one of the things that I do like saying is: don't look at what I say; look at what I do.
I'm likely to do that again.
We've described our strategy over and over again: it's to be the most creative, the most efficient, and the most innovative Company in the business.
It's to deliver a limited number of the highest-quality releases from both of our labels year in, year out.
And it's to annualize our sports and our sports entertainment titles, but not to annualize our action and adventure and other titles.
That's a strategy we're pursuing.
And it's yielded not only great hits from our franchises, but great new hits every year since 2007.
I can't guarantee it'll keep happening, but certainly that's what we are aiming towards.
And we're doing that while we build these new businesses ---+ these businesses that are free to play, these businesses that take place in Asia, these businesses that are massive multiplayer businesses.
So that's much as I can say about the pipeline.
But as you can tell from my voice, we're super excited about it.
And specifically, with regard to any of the labels, you know, they'll talk about their own plans.
But what Rockstar has been able to achieve with GTA Online, which ---+ even if you did look at it on a stand-alone basis, you'd say, my, that's an incredibly extraordinary, powerful, and profitable release.
Again, more than two years after the release, well, that's something to be very proud of, indeed.
Historically, it's been somewhere between four and nine months, depending on the label and the release.
And by the way, I know I skipped over your basketball (technical difficulty) I didn't mean to.
I guess at the risk of sounding over-promotional, which really isn't my style ---+ but you know, we sold-in over 6 million units.
This is the industry-leading title.
And the team at Visual Concepts has done an amazing job.
Their scores are up again this year.
And we tend to be people who ---+ you know, the question we like to pose most frequently is: what are we missing.
What can we do better.
And I promise you, the team, Visual Concepts, and 2K will only try to make that title better and better.
And if we succeed, it will continue to perform.
That's also reflected in recurrent consumer spending for the title.
Our sale of virtual currency is up 72% year-over-year.
So ---+ and again, since ---+ we're not organized around those percentages; they are a reflection of what we're doing.
I think it's a reflection specifically of just how much consumers love the title.
It's a really great question.
And I think if you take a look at our headcount, our investment has been on the development side.
We showed up here in 2007, I think we had about 1,100 people who were involved with development, and now it's about 2,000 people ---+ maybe even a bit more.
You should expect that to continue to grow.
What we try to keep as modest as possible is fixed overhead that is not responsible for either creating intellectual property or exploiting that intellectual property.
And so some of our competitors made a good deal of noise around building service centers, data centers, call centers and the like; and we'd like nothing more than to have none of that infrastructure here, although we do have some.
You're right; we have had to build some expertise on the service side.
I think we are proud of what we have built.
Pound-for-pound I'm quite certain we have a much leaner service team than any of our competitors, and we want to keep it that way.
But it means that we have to be smarter; we have to innovate.
But we are pretty well allergic to fixed costs and to non-revenue-generating overhead.
Thanks, <UNK>.
In terms of our financial commitment in the eSports space, it's not significant at all at the moment.
It doesn't mean it won't be in the future.
And in fact, it's been a net contributor, because we were an investor in Twitch early on.
And we had great return on investment.
So we bet very early on this space, and it worked out super well for us.
But no, this is not a meaningful commitment.
And there's ---+ the risk is de minimis, absolutely de minimis.
And that's how we like to do things unless and until we are convinced that an economic opportunity exists.
Our view in the business is since only we can exploit our intellectual property, we have the ability to be somewhat judicious as businesses are developing and then step in when there is an opportunity.
I think there could well be an opportunity for eSports in Korea.
It remains to be seen.
It's a very active market.
We consider ourselves reasonably expert.
We have a terrific partner there, and we know the market well, and we have an on-the-ground presence.
But it's a little early to say.
Sure, <UNK>.
So for the convert, our 1.75% convertible notes mature in December.
And to date it hasn't made economic sense to take them out before the maturity date.
But we definitely are going to keep an eye on it as it gets closer to the maturity.
And we have the option to settle it in either cash or stock.
So when we get closer to the date, we'll see what the best option is for us at that time.
Yes, it's December of this year.
Thank you, everyone, for joining us.
We are thrilled with the results that we've just reported.
We appreciate your engagement and support.
Once again, to all of our colleagues, thank you for all the great work.
