Greetings, and welcome to Take 2 Interactive Software Second Quarter Full Year 2021 Earnings Conference Call. At this time As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Hank Diamond, Senior Vice President of Investor Relations And Corporate Communications.
Good afternoon. Welcome and thank you for joining Take 2's conference call to discuss its results for through the second quarter of fiscal 2021 ended September 30, 2020. Today's call will be led by Strauss Zelnick, Take 2's Chairman and Chief Executive Officer, Carl Sladov, our President and Lainie Goldstein, our Chief Financial Officer. We will be available to answer your questions during the Q and A session following our prepared remarks. Before we begin, I'd like to remind everyone that statements made during this call that are not historical facts are considered forward looking statements under federal securities laws.
These forward looking statements are based on the beliefs of our management, as well as assumptions made by and information currently available to us. We have no obligation to update these forward looking statements Actual operating results may vary significantly from these forward looking statements based on a variety of factors. These important factors are described in our filings with the SEC including the company's most recent annual report on form 10 k and quarterly report on form 10 q, including the risks summarized in the section entitled Risk Factors. I'd also like to note that unless otherwise stated, all numbers we were discussing today are GAAP and all comparisons are year over year. Additional details regarding our actual results and outlook are contained in our press release, including the items that our management uses internally to adjust our GAAP financial results in order to evaluate our operating performance.
Our press release also contains a reconciliation of any non GAAP financial measure to the most comparable comparable GAAP measures. In addition, we have posted to our website a slide deck that visually present our results and financial outlook. Our press release and filings with the SEC may be obtained from our website at www.take2games.com. And now I'll turn the call over to Thrive.
Thanks, Hank. Good afternoon, and thank you for joining us today. I'd like to begin by acknowledging those who've been affected by the global pandemic on behalf of our entire management team, I'd like to express everyone who serves on positive momentum continued in the second quarter with operating results that significantly exceeded our expectations. Our stellar results were highlighted by the outperformance MBA 2K, PGA Tortue K21, and the mafia definitive additions and mafia trilogy. Our ability to deliver the highest quality entertainment experiences to our audiences during these challenging times is a reflection of the professionalism and the passion of our Thier Organization.
I'm immensely proud of our teams throughout the world that embody our core tenets of creativity, innovation, and efficiency. On September 4, 2K and Visual Concepts launched MDA 2K21, the latest installment in our industry leading basketball simulation series for PlayStation 4, Xbox I, Nintendo Switch, PC and Stadia. The title was off to a remarkable start and net bookings from the title have outperformed our expectations. To date, MBA 2K21 is sold in over 5,000,000 units. As compared with the second quarter of fiscal 2020, net bookings for the NBA 2K series grew 20 percent and recurrent consumer spending significantly exceeded our expectations growing an incredible 76%.
Consumer engagement with NBA 2K continues to increase with daily active users, my career users, and my team users growing significantly. Moreover, NBA 2k21 users have been more deeply engaged with the game, with average games played for user up 21% as compared to MBA 2k20 in the same period. Next week, NBA 2k21 will launch for next gen platforms, which Carl will discuss shortly. I'd like to congratulate 2K and visual concepts for delivering another outstanding entry in this beloved franchise. 7 years after its initial release, Grand Theft Auto5 continues to grow its audience.
The title is now sold in over 135,000,000 units and remains one of the most successful and iconic experiences in all of entertainment. In addition, recurrent consumer spending on Grand Theft Auto Online outperformed our 2nd quarter forecast and was the title's best 2nd quarter ever in terms of both active players and new players. During the month of August, Rock our games were released below Santos's summer special for Grand Theft Auto Online, featuring an array of new vehicles, co op missions, business battles racetrack, the open wheel race creator and more. We continue to expect Grand Theft Auto Online to establish a new net bookings record in fiscal 2021. Red Dead Redemption 2 also outperformed and today has sold in over 34,000,000 units worldwide.
Net bookings from Red Dead Redemption 2 grew an outstanding 124%, including 106% growth in full game sales. Engagement with and recurrent consumer spending on Red Dead Online continues to increase with net bookings from the title surpassing expectations growing 96%. Furthermore, the title grew 28% in audience and growth in new players was 47%. During the second quarter, Rockstar Games added new content to Red Dead Online, including the naturalist update and new specialist role, including the ability to hunt track and study legendary animals as well as new poaching missions and free roam events, 2 new weapons, the advanced camera and more, including the latest addition of Outlaw Pass, the Outlog Pass 3. Throughout the coming year, Rockstar Games will continue to support both Red Dead Online and Grand Theft Auto in line with more content updates to keep new and returning players excited and engaged.
In late summer, 2K enhanced further our sports simulation offerings with the release of PGA Tortuek21 for PlayStation 4, Xbox 1, Nintendo Switch PC and Data. Developed by HB Studios, PGA Tortuek21 was universally lauded by consumers and critics, including game and former golf digest in USA TODAY for being an incredibly fun, realistic and engaging entry into the category. The title has exceeded our expectations and to date has sold in over 1,000,000 units. According to the MTD group, at PGA Tour 2K21 was the fastest selling golf game by units over the past 10 years. And in addition, according to Metacritic, the title is the highest rated golf simulation of the current console generation.
I'd like to congratulate the teams at 2K and HB Studios, we're continuing to support the game with additional post launch content. During the second quarter, 2K also released WWE 2K Battle Ground. A completely new WWE game featuring arcade style brawling action for PlayStation 4, Xbox 1, Nintendo Switch, PC and Stadia. We're very pleased to over the top pickup and play experience. The title has exceeded our expectations and is being supported with post launch content.
In addition, during the period, 2K released mafia definitive edition for PlayStation 4, Xbox 1 and PC, the title, which is exceeded our sales expectations and received significant critical acclaim was comprehensively remade from the ground up. The release of mafia definitive edition completes the full mafia trilogy, a collection featuring definitive editions of all three mafia titles. The definitive additions of mafia, mafia 2 and mafia 3 are available individually or as part of the Trilogy. To date, these titles collectively sold in over 2,000,000 units. Turning to Private Division, during the second quarter, the label released payroll on Gorgon.
A narrative expansion for their award winning RPG, the Outer Worlds from Obsidian Entertainment. Harrolongorgen is the first of 2 that can be purchased individually or bundled at a discount in the Outer Worlds expansion Pass. The Outer Worlds continues to outperform our expectations and has now sold in over 3,000,000 units. Our second quarter results were also enhanced by a variety of other offerings, led by Borderlands 3, Social Point's mobile games and Sid Meier's Civilization VI. Growing 43% and accounted for 64% of net bookings.
In addition to virtual currency for MDA 2K grant of dotted Online and Red Dead Online. Recurrent consumer spending was enhanced by the following offerings. In the free play category, Social points live games, including Dragon City, Monster Legends, World Chef Tasty Town of Word Life outperformed during the second quarter matching the net bookings record achieved in the previous quarter. Live games delivered new fresh content, events and experiences to boost engagement and enhanced the customer experience and net bookings grew 55%. This studio continues to invest in its broad and innovative pipeline of more than 10 new games planned for launch in the coming years.
WWE SuperCard also outperformed during the 2nd quarter growing 24%. The title has now been downloaded more than 22,000,000 times and remains 2K's highest grossing mobile title. Later this month, 2K will deliver season 7 of popular free to play sports entertainment mobile game. And NBA 2k Online in China grew 13% and remains a significant contributor to our results. The title is the number one PC online sports game in China with more than 50,000,000 registered users.
Add on content grew 2 54 percent and outperformed expectations, led by offerings for the Borderlands Series, and Sid Meier's Civilization VI. As a result of our better than expected second quarter performance and improved outlook for the back half of the year, we're increasing our outlook for fiscal 2021, which we expect to deliver a new record for net bookings of over $3,000,000,000. In September, as part of our ongoing strategy to expand selectively our portfolio of owned intellectual property and to diversify and strengthen further our mobile offerings, we acquired PlayDOS, a long standing leader in the mobile puzzle genre founded in 2013 and based in New York City, playdots builds mobile games with unique and thoughtful designs. The studio has created 3 hits, dots, two dots and dots and co, which have collectively been downloaded over 100,000,000 times. They're best known for 2 dots, which has been downloaded over 80,000,000 times since its launch 6 years ago, and and the addition of numerous features to its core games, such as scavenger Hunt and social leaderboards, which are driving meaningful, long term consumer engagement.
In addition, Play Dots will remain focused on existing IP and will continue to create new properties as they've done since their inception. We're very pleased to welcome Nira Frot and the entire team of Play Dots to the Take 2 family and are excited by the potential of their development pipeline and positive long term contribution our business. If there's nothing the next week, we'll usher in an exciting new era in the history of our industry. The eagerly anticipated launches of 2 new gaming platforms from Microsoft and Sony marked the latest technological advances that promised provide our world class development teams with better platforms on which to captivate and engage our audiences. We're both prepared and thrilled to take this next step.
And Carl will have more to share about our offerings for this next generation. As we've seen over the past several months, consumers appetite for and participation in interactive payment has never been stronger. We believe that this trend coupled with the fervor for new gaming platforms bodes well for the upcoming holiday season. And that interactive entertainment will be among the most popular gift giving items. Looking ahead, Take 2 has the strongest development pipeline in history, including sequels from our biggest franchises as well as exciting new IP.
We continue to make great strides to increase the scale of our enterprise organically and creatively, operationally and financially, to capitalize on the many positive trends in our industry and to deliver growth and returns for our shareholders over the long term. I'll now turn the call over to Carl.
I'd like to begin by thanking our teams for continuing their stellar work and achieving strong results that are lining up to deliver a record year for net bookings. Our culture of collaboration coupled with the company's commitment to creating the best entertainment experiences is driving our ongoing success the ability to engage with audiences more deeply than ever before. I'll now discuss our recent As Strauss mentioned, we are very excited about next week's introduction of 2 new leading edge gaming platforms. Through these new robust platforms, our development teams have even greater ability to 2 of 2K's most successful and popular franchises, NBA 2K and Borderlands for both platforms. NBA 2K21 was built from the ground up for next generation consoles and will once again redefine the standard for sports simulations.
In addition to unparalleled graphics and loading speeds, NBA 2k21 will introduce several initiatives to bridge current and new console generations of the game. Including my team cross progression and a shared VC wallet within the same console families. Furthermore, in legend, Kobi Brine's lifetime achievement of basketball excellence is celebrated with the NBA 2K21, Mama Forever Edition. Which will provide players with Just yesterday, 2K released the trailer for the city, featuring a completely overhauled park experience, exclusive to NBA 2k21 on NextGen consoles. Originally introduced an NBA 2K14 for Xbox 1 and TS4, the park helped push 2K forward by creating a competitive online basketball environment that allowed our quickly growing community to compete against each other outside of the authentic MBA experience.
This experience has evolved over the years into the neighborhood and now what we have proudly reduced as the city, which is many times larger and more immersive community based experience, only possible on next gen consoles. It is visual concept's most ambitious execution of a virtual basketball community. Orlands 3 has been fully optimized for NextGen consoles, so mayhem will be bigger and bolder than ever before. All players who own the game on current will be able to download the NextGen upgrade within the same console family for free. This free NextGen upgrade will add a number of exclusive features, including 4 K resolution at 60 frames per second in single player and online co op, plus support for 3 and 4 player split screen co op.
In addition, Rockstar Games has announced that they will bring their iconic Grand Theft Auto V to the next generation of consoles in the second half of calendar twenty twenty one during fiscal year 2022. The new generation versions of the game will feature a range of technical improvements, visual upgrades and performance enhancements to take full advantage of the latest hardware, making the game more beautiful and more responsive than ever. For the community of Grand Theft Auto Online, The journey through this ever evolving world will continue on the next generation consoles with more new updates, including additional content exclusive to the new consoles in TC. There will also be new standalone version of Grand Theft Auto Online coming in the second half of calendar twenty twenty one. Which will be available for free exclusively on PlayStation 5 during the 1st 3 months.
Rockstar Games will share more details on the new versions of Grand Theft Auto Five in the months ahead. Driving long term consumer engagement with our titles after their initial launch remains a key strategic priority for our organization. There are myriad of ways that our creative teams strive to do this. However, we are always focused on designing games with the goal of giving players in experiences that far exceed their expectations and importantly are worthy of their time and money. To that end, we recently released an array of add on content some of our key titles.
Last month, 2K and HB Studios released 2 updates for our popular golf simulation, PGA Tortue, The 3 hole matchmaking update allows players to play a quick multi player around with France. 2 weeks ago, the team launched the Halloween update, featuring fun holiday themed cosmetic items to customize players and courses. Players can expect additional content to be released for PGA Tortuek21 throughout the year. In addition, Private Division, in partnership with the European Space Agency, released their shared Horizon update for Kerbal Space Program for PS4 Xbox 1. The update celebrates the agency's contributions to space exploration and is free for all players of the critically acclaimed physics based space simulation game.
Private Division's new development studio intercept games remains hard at work on Kerbal Space Program 2, which is now planned for release during fiscal 2023. Tomorrow, 2K will release the first update for their new wrestling title, WWE 2K Battlegrounds. The update features new superstars and legends that will be made available throughout the month, adding to the game's outrageous in and out of the ring action. 2K will make additional superstores available in December, and we'll share more details in the coming weeks. More than a year after the initial launch of Borderlands 3, engagement with the title remains incredibly strong.
Next week, due to the immense popularity and success of the title's add on content strategy in season pass, 2K and gearbox software will launch a second season pass for the game. The season pass 2, which will be available for all previous released and all next gen versions of the game, will include 2 brand new content add ons. The designers cut add on will add all new ways to play Borderlands 3 by introducing a new skill tree for each ball hunter, a new standalone mode called arms race, and more, while the director's cut add on includes additional missions, end game content and behind the scenes extras. Designers cut will be available for purchase starting on November 10th, while director's cut is planned for release in spring of next year. Rockstar Games has announced that both Grand Theft Auto Online and Red Dead Online will receive major updates later this year, featuring an extension to the to existing frontier pursuits for Red Dead Online, as well as Grand Theft Auto Online's biggest update ever, which will feature a new take on HEIGHTS in a new location.
For Access Games will continue to deliver new content for Sid Meier's Civilization VI as part of their new frontier pass for PlayStation 4, Xbox 1, Nintendo Switch, PC, and mobile, featuring new civilizations and leaders that will be made available on a bi monthly basis through the end of March 2021. Later this year, the new Frontier Pass will come to mobile platforms, and each pack will be available for individual purchase. And during the first half of calendar twenty twenty one, private division will release the Outer Worlds murder on airdanos, the 2nd narrative expansion for their successful RPG from Obsidian Entertainment. The expansion will be available individually or at a discount as part of the Outer Worlds expansion pass, which also includes the previously released parallel and Gordon. Turning to Esports.
The NBA 2K lead concluded its 3rd season on August 28th with Wizards District Gaming winning the 2020 NBA 2K lead championships. All 2020 season games aired live on the NBA 2k league's Twitch channel in addition to select games airing live on ESPN 2 ESP and physical platforms, Sportsnet in Canada, and the NBA 2K League's YouTube channel. And on delay on EGG network in the Southeast in Southeast Asia and Loco in India. Dash Radio's Nothing but net channel also provided live game coverage. FDA 2 K league has begun the trial process for its 4th season set to take place in 2021.
The new form will include more than 35 Pro Am tournaments hosted by league teams as part of the NBA 2K league draft prospect series. Featuring a first of its kind NBA 2K League combine. The league will enable 2K fans and players to engage with the league and showcase their citement throughout the off season by awarding draft eligibility on a rolling basis to members of the 2 K community who excel in the tournaments as part of the draft prospect series. In addition, we continue to develop and showcase female 2K players. The league is involved with several elites all woman 2K teams, for participating in Pro M2K tournaments throughout the year.
We are very excited about the continued success and growth of the NBA 2K league, which has the long term potential to enhance engagement and to be a driver of profits for our company. Looking ahead, we have the strongest pipe development pipeline at Take 2's history, which well as significant potential to drive the potential to enhance our growth rate. Whether transitioning our audiences seamlessly onto new platforms, capitalizing on new business models and distribution channels, or increasing our presence in emerging markets. Take 2 is exceedingly well positioned to generate value to consumers as well as growth and margin expansion for our company. I'll now turn the call over to Lainie.
Thanks, Carl, and good afternoon, everyone. Today, I'll discuss our 2nd quarter results and then review our financial outlook for the third quarter fiscal year 2021. Please note that additional details regarding our actual results and outlook are contained in our press release. As Strauss mentioned, we delivered 2nd quarter operating results that significantly exceeded our expectations. Net bookings grew to $958,000,000.
This result exceeded our outlook $775,000,000 to $825,000,000, driven primarily by the outperformance of NBA 2K PGA tour, 2K21, and the MAPFIA Disinitive Additions And Mafia Trilogy. Digitally delivered net bookings group 14% as compared to our flat outlook and accounted for 83% of the total. This result exceeded our outlook primarily due to the outperformance of our current consumer spending, During the second quarter, 59% of sales of current generation console games were delivered digitally, up from 51% last year. Recurring consumer spending grew 43% as compared to our outlook of 10% growth and accounted for 64% of total net bookings. This growth was driven primarily by NBA 2K, Social Point's mobile games, Red Dead Online and Red Dead Redemption 2 and Sid Meier civilization 6.
GAAP net revenue was $841,000,000 and cost of goods sold was $433,000,000. Operating expenses decreased by 7 percent to $293,000,000, due primarily to lower marketing expense. And GAAP net income grew to $99,000,000 or $0.86 per share as compared to $72,000,000 or $0.63 per share in the second quarter of last year. Now to our guidance, starting with the fiscal third quarter. We project net bookings to range from $675,000,000 to $725,000,000, compared to $888,000,000 in the third quarter last year, which benefited from the launch of Red Dead Redemption 2 on PC and the Outer Worlds.
The largest contributors to net bookings are expected to be NBA 2k21, Grand Theft Auto Online and Grand Theft Auto Five, Reset Redemption 2 and Red Dead Online, Social Point's mobile games, Borderlands 3, Sid Meier's Civilization VI and PGA Tort 2K21. Expect digitally delivered net bookings to be down approximately 15% due to lower digitally delivered sales of Red Dead Redemption 2 on PC, and the Outer Worlds, which launched last year. Additionally delivered net bookings, our projected to account for 82% of the total compared to 78% last year. Our forecast assumes that 71% of our current generation console game sales will be delivered digitally, up from 44% last year. We project recurrent consumer spending to grow by approximately 5%.
We expect GAAP net revenue to range from $760,000,000 to $810,000,000 and cost of goods sold to range from $291,000,000 to $317,000,000. Operating expenses are expected to range from $3.25 to $335,000,000. At the Vince points, this represents a 4% increase over last year, driven primarily by the addition of Play Dups, higher research and development and IT expenses, partially offset by lower marketing and stock compensation expenses. And GAAP net income is expected to range $128,000,000 to $140,000,000 or $1.10 to $1.21 per share. For management reporting purposes, we expect our tax rate to be 16% throughout fiscal 2021.
We are increasing our full year outlook which now includes record net bookings. This will be the 3rd consecutive year that net bookings have grown. Our net bookings outlook range is now $3,150,000,000 to $3,250,000,000, up from $2,800,000,000 to $2,900,000,000. This is being driven by our 2nd quarter outperformance, along with an updated forecast for the balance of the year, which has improved primarily due to higher recurrent consumer spending from NBA 2K, Rent Theft Auto Online, Red Dead Online, and the addition of Play Dot, as well as strong performance from Red Dead Redemption 2, PGA Tortue 2K21 and the mafia definitive edition and mafia trilogy. We expect growth over the prior year from NBA 2K, Grand Theft Auto Online, Red Dead Online and Social Point's mobile games, to be offset by lower to see NBA 2K, Grand Theft Auto Online and Grand Theft Auto V, Red Dead Redemption 2 and Red Dead Online Social Point's mobile games, Borderlands 3, Zimayo Civilization VI and PGA Tour 2K21.
We expect the net bookings breakdown from our labels to be roughly 55% 2K, 35% Rockstar Games, and 10% private division, Social Point and Play Dot. And we forecast our geographic net bookings split to be about 60% United States and 40% international. We now project digitally delivered net bookings to increase by approximately 15% as compared to our prior outlook This growth is being driven by recurrent consumer spending and digitally delivered sales. As a percentage of our business, digital is projected to represent 87% of net bookings, up from 82% last year. Our forecast assumes that 70% of current generation console game sale will be delivered digitally, up from 55% last year.
We now expect recurrent consumer spending to grow by approximately 30% as compared to our prior outlook of 15% growth. And to represent approximately 63 percent of net bookings as compared to 51% last year. This growth is being driven primarily by NBA 2k Grand Theft Auto Online, the addition of Play DaaS, Social Point's mobile games and Red Dead Online. We are increasing our non GAAP adjusted unrestricted operating cash flow outlook to more than $650,000,000, up from our prior outlook of more than $500,000,000. We plan to deploy approximately $75,000,000 for capital expenditure.
We expect GAAP net revenue to range from $3,050,000,000 to $3,150,000,000 and cost of goods sold to range $1,440,000,000 to $1,490,000,000. Total operating expenses are expected to range from $1,210,000,000 to $1,230,000,000. At the midpoint, this represents an 8% increase over the prior year, driven by the addition of Play Dots, higher headcount, research and development expense and charitable contributions, partially offset by lower marketing and stock compensation expenses. And we expect GAAP net income to range from 3.72 per share. In closing, fiscal 2021 was poised to be another year with record net bookings, despite our light release slate.
With our industry leading creative assets, non financial foundation and unwavering commitment to operational excellence, our company is superbly positioned to navigate these uncertain times, capitalize on positive industry trends and to deliver strong results for our shareholders over the long term. Thank you. I'll now turn the call back to
Thanks.
Did you all hear that?
Sorry, I apologize.
Thanks, Blaney and Karl. On behalf of our entire team, I'd like to again thank our colleagues for their hard work, commitment to excellence and for delivering another exceptional quarter. To our shareholders, I'd like to express our appreciation for your continued support. And we'll now take your questions and apologies for my failure with the mute button.
Thank you. Our first question comes from Mario Lu with Barclays. Please proceed with your question.
Great. Thanks for taking the questions. I have one on NDA and then one high level. So the one on NDA, the city on NextGen was pretty amazing. And you're also bringing back affiliations, which is exciting.
I believe this year is also the first time NDA 2K will have 2 different NDA seasons. Within three months of its release. So with that being said, anything you can provide in terms of the lift unit sales from both the city and a second NDA season and their impact on this fiscal 3Q guide would be helpful. And then secondly, Strauss, just curious if you have updated thoughts on the overall subscription model within video games. I think I agree with you that subscription may not translate well in this industry because users only play a few titles a year.
But we've seen recently companies like Microsoft, push hard, with this game pass subscription. And then with the overall gaming audience expanding due to Shelching in place and more casual titles, like full guides and among us being more popular. So just curious if your stance on subscription has changed at all. Thank you.
It's Carl. I'll take the first question on MBA. Obviously, yes, this is really the first time that we've got this kind of over in the season, not only just our own, not only just the basketball season itself, but in our own game. Obviously, with what as Strauss said before, it's had a really positive impact with us because net bookings for our series grew 28% in recurrent consumer spending grew, I think, was 76%. So these are really incredible results and it's really exciting.
But it's a bit of uncharted territory. And I can tell you that, we couldn't be more thrilled about it because with the new platform coming out and with the NBA 2k21 being built from the ground up, and also all of the new features that are coming up. While I don't have specific lift numbers for you that are associated with the city itself, Obviously, that was a huge commitment made by the team at Visual Concepts and the 2K. And we're really, really excited about it. And anytime you do come out with something that could be a game changer, for any game, but specifically for our game, we tend to see really excellent results And we've already seen great results.
And I think it's going to be even better when we launch our NextGen platform, and we're very excited about it.
And, Mario, regarding your question on subscriptions, no, I don't think our views have changed much. We're open minded. We're highly skeptical that subscriptions will be the only way or the primary way that interactive entertainment is distributed. And that's because of the way people consume it the price point for owning a title, which is very reasonable on very, very low actually per hour basis. So I think it's unlikely that subscription sort of supplant frontline video game failed as the primary business model.
Subscriptions can play a role in delivering catalog. We've supported numerous subscriptions, subscription offerings with catalog titles. I imagine we'll continue to do so. In any case, at the end of the day, the consumer will decide and we will be where the consumer is.
Our next question is from Eric Handler with MKM Partners. Please proceed with your question.
Yes. Good evening. Thanks for the question. Wondered if you can give us any updates about your thoughts on pricing, you've announced NBA 2K is going to have a $10 price increase, console over console system or next gen versus current gen, how you're thinking, with that? And then I'll have a follow-up question.
Yes, thanks, Eric. Pricing is determined on the title by title basis. We already explained that reason for the price that we set for MDA 2K21 for next gen reflected the fact that there hasn't been a front line price increase since 2 1005. Yet production costs have gone up 2% or 300% on the one hand also because we believe we deliver vastly more value to consumer than the price we charge. That's our goal at all times.
As I said, on a per hour basis, interactive entertainment is an incredible bargain. And the U. S. Has the lowest frontline pricing of anywhere on earth. So we think it makes sense and, we believe consumers are fine with it as a result.
Okay. And then, as a follow-up playdups, looks like it's potentially a very nice tuck in acquisition. As you look at the M and A landscape, is there much out there for additional acquisition seems like there's more mobile type deals to be had rather than, console specific type companies, but maybe if you could just give us some color on the end of the landscape.
Look, we have seen an acceleration in M and A activity. Obviously Microsoft is acquiring Bethesda. For example, which is a significant, I believe, 7 some odd $1,000,000,000 transaction. And so I think that you're going to continue to see increased M and A activity just because of the heat around the category and the amount of capital that's being deployed by big companies to pursue it. From our point of view, we we have almost $2,400,000,000 in cash.
We have no debt. And, we are anxious in, to build our business aggressively doing so. And we use our capital to support organic growth or primary story at Take 2. We also will use our cash to, acquire companies when they're strategically consummate and when those deals are accretive. And we return CAPA to the shareholders on a regular basis through buybacks, and that'll continue to be our approach.
Thank you.
Our next question is from Drew Crom with Stifel. Please proceed with your question.
Okay. Thanks. Hey guys, good afternoon. For Strauss or Carl, can you comment on cross platform play and how you think about this across your portfolio? And specifically, if the next gen version of GE that will feature cross play?
And then I have a follow-up.
Hi, Joe. It's Carl. We do think about cross play a lot and I think for a lot of games, that are out in the market that do support cross play, it makes a lot of sense. It's certainly something that's very intriguing to us. It's something that we're capable of doing.
And obviously, it's not our decision alone. There's platforms involved as well. We haven't made any specific announcements about cross play. We are enabling certain cross generational cross generational opportunities within our games. But in terms of crossplay, it's very interesting think it's a from a player liquidity perspective, it can be a very compelling thing.
But it also has some for some games, it also has certain limitations. If you're crossplaying between mobile and console games, it's not always the best experience for everybody. So there are considerations that you have to make when those types of decisions. But obviously, we do consider it, and it's a great opportunity for our industry in general going into this next generation.
Got it. Okay. And then, Laney, if I heard you correctly, you indicated the RCS would be up 5% in the December quarter. Is that correct?
Yes, that's correct.
Okay. Can you talk about the assumed deceleration and how that aligns with timing of the big updates for For Rockstar Online?
So for GCA, we have for Q3, we have it coming down in the third quarter versus last year. And, when we look at GTA, we always sort of look at it being out for 7 years and we think about, the quarters going forward. And since it's something that has been out for so long. We tend to forecast it as coming down each quarter and it always beats our expectations. So when we go out into the future, that seems to be how we guide, for that title.
Okay, okay.
The growth in the quarter is coming from the MBA title.
Okay, got it. Thanks guys.
Our next question comes from Mike New with Goldman Sachs. Please proceed with your question.
Great, thanks. Strauss, I was wondering if you could provide your view on using free to play experiences to enhance the reach of your franchises For instance, in the spirit of Call of Duty Warzone And Call of Duty Modern Warfare, would it ever make sense to make a free to free to play component available for GTA or MBA 2K? Thanks.
Well, look, we're pretty open minded. And, at the same time, we deliver the highest quality experiences in the business. And we charge much less for them than we believe they are worth to consumers. And then we deliver typically an ongoing component. That is free.
And that's already a great deal of value. Any monetization of course is totally optional. And unlike many sort of casual titles, the monetization is not necessary to enjoy the experience. It's an additional benefit, but you there are no toll boots in any of our in any of our, online games that are attached to our core games. We have on occasion promoted our games very cheaply or in a couple of instances, free, which effectively means you have access to the online component free as a promotion.
And I wouldn't rule out the possibility of doing that. And of course, Rockstar has announced that GTA Online will be a standalone experience for NextGen coming in second half of twenty twenty one. And that it'll be free for PS5 users for about 3 months. So as you can see, we're open minded about our business model, And I wouldn't rule out the possibility that at some point, certain experiences can become free as a matter of the entry point I like what I consider sort of tethered free to play. 100% of the people acknowledge the value of the title and pay to play it.
On an ongoing basis, you have what is effectively a free to play experience attached that can go on for many years, aggressive, dotted line, of course, has been successful. For 7 years and is expected to set a new record in this fiscal year amazingly enough. I think that you're also implying another question, which is some of our competitors have taken legacy IP and created standalone mobile free to play titles related to that IP and branded that IP. And we have not done that yet. We have not announced any plans to do it.
And the world in which we would do it, of course, would be when our labels are excited by the opportunity creatively and when we think we can deliver something to consumers that's absolutely stellar.
Great. That's incredibly helpful. Thank you, Strauss.
Our next
question is from Gary Johnson with BMO Capital Markets. Please proceed with your question.
Great. Thank you. Good evening. It's Travis. Nicole Lainie.
On NBA 2k, I have a 2 part question. You decided to not offer free upgrades from current to NextGen, but you did release Mamba forever, dual access for $100. So did you see people do? Did you see people mix up immediately to Mamba forever or maybe delay the purchase of 'twenty one until NextGen comes out? So maybe we see a second wave?
Yes, I mean, I don't have any specifics to share. This is Carl, by the way. I don't have any specific, it's a great question. I don't have specifics to share with you about what activity we've seen. And by the way, it's kind of hard to know because we're still pretty early in it.
And we sold already 5,000,000 units And we've had lots of nice action around all of our, all of our skews. But we don't know what people would otherwise be doing. So it's sort of hard for us to know whether people are waiting or whether they're going for the mamba now, or they're just buying the current gen and they'll buy the next gen later or just buy current gen. It all remains to be it's a little bit of uncharted territory and it remains to be seen. But what we were very gracious before and proud of is the fact that the activity and the engagement around what we've seen so far has been incredible.
So no matter how much it breaks down by SKU, I think we're looking at a really good release for NBA 2k21.
Okay. Thank you, Carl. And by the way, there's $100,000 worth of virtual currency in Mamba forever. So how much of that contributed to the 76 percent recurrent consumer spending growth in MBA?
We
don't share
Okay. Thanks.
Our next question is from Brian Nowak with Morgan Stanley.
Hi, everyone. Thanks for taking my question. It's Matt on for Brian. So kind of following up on the city content in NBA 2K. Are you seeing any new types of behavior, particularly in the lack few months inside of the games, whether it's people socializing more rather than just playing games or kind of like new use cases that you're noticing players eke out?
And is cities kind of an opportunity to expand on that and sort of like keep users stickier by adding new sorts of in game activities. And then just secondly, I was just wondering if you could provide an update on, the progress with some of the newer studios like 31st Union and then cloud chamber is everything in place to sort of, hit the pipeline that you guys shared earlier this year? Thanks.
Hey, Matt. It's Carl. In terms of the city, I think the real quick answer to the question is, really since the heart came back out in 2014, we've seen more social activities in, in NBA generally speaking. And as the environments got more sophisticated and there was more things to do, that social activity has been increasing all along. And you see big jump in that as well.
When you come out, when we move from the park to the neighborhood, we saw a market difference in how people play in the game. You create events people, people create their own events within the communities themselves. And the more that you give you more that you content you give within these communities and within these spaces, within these worlds, it encourages people to spend more time there. And that's a really great thing from an engagement perspective. Because number 1, I think it does actually, people love it.
And driving engagement also drives economics for us. And that's one of our objectives. So the building out the city was a huge endeavor that VC took on. We think it's going to be really well received. We think people are going to spend a lot of time in the city And it really will take that whole concept of open world social gaming to another level in the context of NBA.
So we're very excited.
Yes. And in terms of how things are going at our studios, particularly our new studios, the answer is very, very well. We have an extraordinary pipeline. We've coupled our prior pipeline of releases over the next 5 years. You mentioned 2 of our studios, I'd really I'd really talk about all of our studios and there are many now, and, everything is looking great and is on target.
We do not expect, to see any slippage. And while I think working from home is really tough, and I admire our colleagues for doing such a great job doing it. It isn't the same as being in the office and yet we have not seen any slowdown in our expected cadence of releases.
Great. Thank you.
Our next question is from Todd Juenger with Sanford Bernstein. Please proceed with your question. Hi,
thanks. One sort of high level 1 and then one house keeping. The higher level 1, just following on, you've been asked so far about subscription and free to play in really every permutation of business model and platform. I'm going to ask the sort of the mobile question version of that, if you don't mind. Especially given you've seen, some other AAA publishers be very aggressive you could argue successful in taking what used to be console IP finding a big home for it, relatively big home for it in mobile.
When you sort of think about the role of mobile across your IP portfolio and studios, I wonder, if you have any big ideas there, I think that that fits front of your big IP? And if so, do you have the sort of resources you need in house to make that sort of development effort? And then the super quick one is, if you don't mind, so I know typically you guys aim to release a AAA frontline title generally every year. Outside of 2K, NBA 2K, you didn't have one this year. I wonder when you look at next year, do the remastered versions of GTA and RDR does that fit your definition of a AAA console release or not?
Thanks.
Yes, thanks. In terms of the portfolio of owned intellectual property, which we're very proud, we have 11 franchises that have sold over 5,000,000 units with an individual release and over 60 that have sold over 2,000,000 units. And there's some of the most extraordinary franchises in the entertainment never mind, the interactive entertainment business. I think I alluded to this earlier, we wouldn't rule out possibility of making a standalone mobile title based on that intellectual property would be driven by the labels creative desire to do so in a belief that we could do an extraordinary job at it. We have a lot of talent in the mobile space now at numerous labels, play dot Social Point 2K and others.
And I don't doubt that we could we could put together the resources for the properties that make sense. So stay tuned on that topic. It is not lost on us that the biggest hits in the mobile business are native to the mobile business. They are not based on licensed IP. They're not based on console IP.
The biggest hits are native to the business. And in terms of our ongoing release schedule, we haven't said very much at all, about fiscal 'twenty two. We have said that, GTA Online and GTA5 are coming for next gen. In the second half of calendar 'twenty one. We said the Kerbal Space Program 2 is coming in fiscal 'twenty three.
But we will be talking about our release schedule for 22, in due time. And Our goal remains the same, but it's too early to comment on what the release schedule will look like.
To answer your question specifically though about the form extensions and whether we consider them the part of our core gaming experience. We do. So we did say before the ninety three titles, 63 that we mentioned that our pipeline, which was more than double what it was 5 years ago, by the way. 63 of those are core gaming experiences, and that includes 15 platform extensions.
Got it. That's helpful. And sorry for any redundancy on the mobile there, but I appreciate that additional comments. That was helpful. Thanks everybody.
Our next question is from Alex Jama with Jefferies. Please proceed with your question.
Great. Thanks for the question. Strauss, I think the messaging recently has been has still been for growth from the company. We think about next year, as we think about fiscal 2022, does that change at all as you continue to beat and raise expectations this year and the comp gets any more challenging or is the expectation still for growth next year? Thank you.
So for fiscal year 2022, given that we now expect net bookings of over $3,000,000,000, this fiscal year. It's too early to predict whether our business will grow next year. Our results this year have benefited from sheltering at home and it remains seen whether that will continue to last into next year. So, it's just a little bit too early to call at this point.
We have reached the end of the question and answer session. At this time I'd like to turn the call back over to Strauss Zelnick for closing comments.
Thank you very much. On behalf of everyone at Take 2, I'd like to wish you all a very happy and healthy holiday season. These are extraordinary times, and I wish you all the best through them. And once again, I'd like to thank all of our colleagues for their incredible work and for these extraordinary results. Have a great evening.
This concludes today's conference. You may disconnect your lines at this time and we thank you for your participation.