Take-Two Interactive Software, Inc. stock research
FY2026 Q2
Take-Two Interactive Software (TTWO) Gross Margin — Quarter Ended Sep 30, 2025
Revenue increased compared to both the prior quarter and the same quarter a year ago, while gross profit also rose. However, gross margin weakened sequentially because cost of revenue grew at a faster pace than revenue, although it improved year over year as revenue growth outpaced cost growth.
Gross margin takeaway
Quarter ended Sep 30, 2025 · FY2026 Q2
Revenue increased compared to both the prior quarter and the same quarter a year ago, while gross profit also rose. However, gross margin weakened sequentially because cost of revenue grew at a faster pace than revenue, although it improved year over year as revenue growth outpaced cost growth.
- The strongest observable margin driver was the sequential increase in cost of revenue, which grew at a substantially higher rate than revenue, compressing gross margin. Year over year, the relationship reversed, with revenue growing faster than cost of revenue, lifting margin.
- Gross margin was lower than the prior quarter but higher than the same quarter one year earlier. Revenue and gross profit were both higher in both comparisons.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
55.3%
Gross profit
$980.5M
Revenue
$1.8B
Cost of revenue
$793.3M
Quarter-over-quarter change
-7.6 pts
Year-over-year change
+1.5 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Dec 31, 2024 | $1.4B | $759.9M | $599.9M | 55.9% |
| Mar 31, 2025 | $1.6B | $803.3M | $779.2M | 50.8% |
| Jun 30, 2025 | $1.5B | $945.0M | $558.8M | 62.8% |
| Sep 30, 2025 | $1.8B | $980.5M | $793.3M | 55.3% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2025
-7.6 pts
Year-over-year change
Sep 30, 2024
+1.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver was the sequential increase in cost of revenue, which grew at a substantially higher rate than revenue, compressing gross margin. Year over year, the relationship reversed, with revenue growing faster than cost of revenue, lifting margin.
Gross margin was lower than the prior quarter but higher than the same quarter one year earlier. Revenue and gross profit were both higher in both comparisons.
Monitor the trajectory of cost of revenue relative to revenue, as the sequential divergence was the primary factor behind the margin decline.