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August 22, 2019
Lainie Goldstein
Chief Financial Officer
Take-Two Interactive Software, Inc.
110 West 44th Street
New York, NY 10036
Re: Take-Two Interactive Software, Inc.
Form 10-K for the Year Ended March 31, 2019
Filed May 14, 2019
Form 8-K furnished on August 5, 2019
File No. 001-34003
Dear Ms. Goldstein:
We have reviewed your filing and have the following comments. In some of
our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to these comments within ten business days by providing
the requested
information or advise us as soon as possible when you will respond. If you do
not believe our
comments apply to your facts and circumstances, please tell us why in your
response.
After reviewing your response to these comments, we may have additional
comments.
Form 10-K for the Year Ended March 31, 2019
Consolidated Statements of Operations, page 57
1. Your disaggregation of revenue between "service and other" and "product"
appears to be
based on the timing of revenue recognition (point in time versus over
time). Please tell us
the amount of product revenue included in the service and other category
and clarify
whether you consider add-on content and in-game purchases to be a product
or service. To
the extent the remaining service revenue is greater than 10% of total
revenue, separately
present revenue and the related cost of revenues from product and
services on the face of
your consolidated statement of operations. Refer to Rule 5-03(b)(1) and
(2) of Regulation
S-X.
Lainie Goldstein
FirstName Interactive Software, Inc.
Take-Two LastNameLainie Goldstein
Comapany NameTake-Two Interactive Software, Inc.
August 22, 2019
August 22, 2019 Page 2
Page 2
FirstName LastName
Note 1. Basis of Presentation and Significant Accounting Policies
Segments, page 61
2. We note that international revenues comprised approximately 46% of
total net revenues.
To the extent that revenue from any one country is material, please
separately disclose the
revenue related to such country. Refer to ASC 280-10-50-41.
Revenue Recognition , page 65
3. We note that you recognize revenue for full game products that are
dependent on your
game related service over an estimated service period as substantially
all game play
requires online access to your game related services. Please provide
us with a detailed
analysis of the factors considered in determining that the software
and gaming services are
not both distinct and separable for certain of your games and tell us
to which specific
games this accounting applies. Clarify whether such games can be
played offline and if
so, how that factored into your analysis. Tell us the amount of
revenue recognized from
such games for fiscal 2018 and to date in fiscal 2019. Refer to ASC
606-10-25-19
through 25-21.
4. You state on 71 that upon the adoption of ASC 606, the "majority" of
the sales price for
certain of your games was allocated to the offline software and
recognized upon transfer
of control to your customers. Please describe for us each of the
performance obligations
included in your products with online functionality. Explain further
the specific methods,
inputs, estimates and assumptions used in determining the standalone
selling price for
each performance obligation and tell us the percentage of the
transaction price allocated to
each.
5. Specifically with regards to the performance obligation related to
online functionality,
please help us understand the different roles and responsibilities
that you and your
platform partners have with respect to technology, host
configurations, maintenance and
services. Tell us whether you use your own or third-party servers to
host the multiplayer
or online game play and describe the interaction of your online
functionality with Sony
and Microsoft's platforms. Compare and contrast the different service
obligations that you
and your platform partners have with respect to the players who
purchase your games and
how such obligations factored into your determination of the
standalone selling price and
the transaction price allocation for your game related services.
6. Please describe further for us the nature of your in-game content.
Tell us what product
and/or services are transferred to the game-player upon sale of such
goods and how that
impacts the timing of revenue recognition. Clarify whether the type of
game in which the
in-game purchase is made (e.g. games with offline functionality vs.
online only games)
impacts the accounting for such transaction. Also, please cite the
specific guidance you
relied upon in accounting for such sales.
Lainie Goldstein
FirstName Interactive Software, Inc.
Take-Two LastNameLainie Goldstein
Comapany NameTake-Two Interactive Software, Inc.
August 22, 2019
Page 3
August 22, 2019 Page 3
FirstName LastName
Form 8-K furnished on August 5, 2019
Exhibit 99.1, page 2
7. We note your measure of adjusted cash flow includes an adjustment for
changes in
restricted cash. Considering the presentation of restricted cash
within the statement of
cash flows was amended with the adoption of ASC 2016-08, tell us how
you determined
that such adjustment does not result in a non-GAAP measure based on
individually
tailored accounting principles and why you believe this measure is
useful to investors.
Refer to the guidance in Question 100.04 of the Non-GAAP C&DIs and
Rule 100(b) of
Regulation G.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
You may contact David Edgar, Staff Accountant at 202-551-3459 or Kathleen
Collins,
Accounting Branch Chief at 202-551-3499 if you have questions.
Sincerely,
Division of
Corporation Finance
Office of
Information Technologies
and Services