Take-Two CEO Strauss Zelnick has spent many, many years answering questions about Grand Theft Auto 6, which is likely to be one of the biggest video game releases in decades when it arrives in November. So when a question came up during a short meeting that seemed to reference GTA 6’s many delays, it wasn’t surprising that he took extra time to “quibble” with the question in a way that seemed almost grumpy and a bit defensive.
On September 17, during a short shareholders meeting, Zelnick answered a handful of questions submitted by investors. Most of these weren’t about the routine meeting, but instead about, you guessed it, GTA 6. People were curious about the PC version, multiplayer, and other topics Zelnick has vaguely answered many, many times over the years. But then one investor’s question seemed to rankle Zelnick, and he deliberately made a point to read the entire question out, not just paraphrase it, and push back on it during the short call.
“The next question I… actually will read,” said Zelnick via an audio recording of the meeting. “Many shareholders have tolerated years of delays, missed expectations, and continued dependence on a small number of major franchises. If these issues persist, does the board believe that the current management team remains the right group to lead the company, or is prepared to replace senior executives if operational performance and shareholder value creation do not improve?”
Zelnick clarified that Take-Two’s board was “diligent and rigorous” and demanding “high performance.” He also claimed that if he and other execs underperformed, they would be replaced. The CEO then took aim at the question, which seemed to suggest Take-Two isn’t diversified or successful enough.
“I would, however, quibble with your characterization in the question,” responded Zelnick in a tone that is about as close to grumpy as a corpo exec can muster.
“When this management team took over the company in March of ’07, the stock price was 17. The revenue of the company was under a billion dollars. The company was under investigation by at least four government entities, had not filed annual reports in 13 months, and had not scheduled an annual meeting despite obligations to do so. They had one major franchise in GTA. The rest of the business was losing money, and the company was very nearly bankrupt.”
“Since then, this management team has reduced the cost profile at that time, diversified the company meaningfully, entered the mobile business, launched more than 11 franchises that have each sold over 5 million units with an individual release, and today is the largest, by market cap, of pure-play interactive entertainment company that’s public on Earth. And if a management team is judged on stock price, and I do believe that’s an important measure, our stock has appreciated since March of ’07 to today about 1,200% versus the S&P at 440% and the NASDAQ at 980%. And of course, the company’s revenue is guided to be between $8 and $8.2 billion this year, with very significant pre-cash flow anticipated.”
He then moved on to the next couple of questions before wrapping up the short meeting. While Zelnick is accurate to point out that 20 years ago, Take-Two was in a bad spot, his response also feels defensive. The company does have a history of games being delayed and, as a result, missing expectations. Then again, between Borderlands, NBA 2K, GTA, Mafia, and its empire of mobile games, the company is making more money now than ever before. So I get why he might be a bit annoyed by that question.
I also bet Zelnick is just telling himself that in a few months, he’ll never again have to answer a question about when GTA 6 is launching or what features are included. Instead, he’ll spend the next decade answering questions about its sales, updates, and ports. I guess the billions of dollars in pay help balance it all out.