The ongoing tariff situation in the United States has been a topic of concern for many in the gaming industry, affecting everything from consoles to accessories and software. However, Take-Two Interactive's CEO, Strauss Zelnick, appeared relatively unfazed by the potential impact of tariffs during a recent Q&A session with investors.
When asked about the potential for console price increases and their effect on the gaming ecosystem, particularly in light of the recent Xbox Series price hike and the anticipated increase for the PlayStation 5, Zelnick remained confident. He pointed out that Take-Two's fiscal guidance for the next ten months is robust and unlikely to be significantly affected by tariffs, unless they deviate drastically from current expectations.
Zelnick explained, "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."
His confidence stems from the fact that most of Take-Two's upcoming releases will be available on platforms that consumers already own. The potential impact of a few people deciding to buy or not buy an Xbox Series, PS5, or even the upcoming Nintendo Switch 2 is minimal. Moreover, a significant 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 business, which are not subject to tariffs.
Despite this confidence, Zelnick acknowledges the unpredictable nature of tariffs. Analysts have consistently highlighted the ever-changing landscape, and even Zelnick leaves room for potential shifts. In discussions prior to the investor call, Zelnick also touched on the development timeline for GTA 6, which has been delayed to next year, and expressed optimism about the upcoming Nintendo Switch 2.
