In recent discussions about the impact of the ongoing tariff situation in the United States on the gaming industry, ranging from consoles to accessories and software, there's been a spectrum of reactions. However, Take-Two Interactive's CEO, Strauss Zelnick, appeared notably unconcerned about the potential effects of tariffs during a recent Q&A session with investors.
When questioned about the potential rise in console prices, specifically referencing the recent increase in Xbox Series prices and the anticipated hike for the PlayStation 5, Zelnick expressed a steady confidence in Take-Two's financial projections for the upcoming fiscal year. He stated, "Our guide is for the next ten months, essentially, that's the part of the fiscal year that hasn't elapsed yet, and it's very difficult to predict where tariffs will land, given how things have bumped around so far. We feel reasonably confident that our guide wouldn't be meaningfully affected, unless tariffs ran off in a very different direction than we currently expect. In any case, there's already a very substantial install base for all of our target platforms except Nintendo Switch 2, which is pre-launch. So we have, I think, enough insight that we wouldn't be affected by any changes."
Zelnick's confidence stems from the fact that the majority of Take-Two's upcoming game releases will be available on platforms that already boast a significant user base. He noted that a small fluctuation in the sales of Xbox Series, PS5, or even the forthcoming Nintendo Switch 2 would not significantly impact their business. Moreover, a substantial portion of Take-Two's revenue is derived from digital purchases within ongoing games such as GTA V, Red Dead Redemption 2, and their mobile gaming division, which remain unaffected by tariffs.
Despite this assurance, Zelnick acknowledged the unpredictable nature of the tariff situation, echoing the sentiments of analysts who have consistently highlighted the fluidity and unpredictability of the current economic climate. Even with this uncertainty, Zelnick remains optimistic about the future, including the development timeline of GTA 6, which has been delayed to next year, and the upcoming release of the Nintendo Switch 2.
