Take-Two Interactive Software (TTWO) is no stranger to success.

For nearly two decades, the company has churned out blockbuster titles like Red Dead Redemption II and other highly-acclaimed games.

It also has the distinction of being the publisher behind one of the most popular video games in history, Grand Theft Auto V.

And now, Take-Two is set to release its highly acclaimed sequel, Grand Theft Auto VI.

2026 has the makings of being a blockbuster year for the company, yet investors are underestimating this gaming giant.

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Take-Two Interactive Software (TTWO) is no stranger to success.

Since 2007, the video game publishing company has churned out blockbuster titles like Red Dead Redemption II and Borderlands 2.

It also has the distinction of releasing one of the most influential and highly acclaimed video games in history, Grand Theft Auto V.

The next installment—Grand Theft Auto VI—is set to launch on November 19. And Take-Two CEO Strauss Zelnick wants to make sure it meets expectations.

The title has been in development for more than eight years. And it could be the first video game release to surpass $1 billion in development costs.

Yet despite being one of the most anticipated releases in media history, the Take-Two’s stock has suffered.

From January through early April 2026, it fell as much as 24% as investors feared that AI could displace development teams by creating playable games in months rather than years.

It’s not an exaggeration to say that Grand Theft Auto VI holds the key to the company’s future.

During the 2025 Game Awards, the sequel won the Most Anticipated Game award, winning it again after doing so in 2024.

That’s a great sign considering it’s following in the footsteps of one of the most popular video games of all time. Grand Theft Auto V has sold more than 225 million units since its 2013 release. To this day, it’s still generating millions of dollars every year.

The online component, Grand Theft Auto Online, has turned the franchise into a cash cow that generates roughly $500 million in revenue annually.

And there’s no reason to think Grand Theft Auto VI will be any different. In fact, Take-Two has a two-part strategy.

First, it would launch the game on the PlayStation 5 and Xbox video game consoles. (Some analysts expect fans to buy 25 million units of Grand Theft Auto VI on day one.) The company would then roll out the game’s next-generation Grand Theft Auto Online multiplayer mode.

With the V and VI versions in tow, online spending would keep money flowing into Take-Two for years to come.

That said, the market’s expectations are surprisingly timid. And we can see this through our Embedded Expectations Analysis (“EEA”) framework.

The EEA starts by looking at a company’s current stock price. From there, we can calculate what the market expects from the company’s future cash flows. We then compare that with our own cash-flow projections.

Take-Two’s Uniform return on assets (“ROA”) jumped to more than 100% during its 2024 fiscal year. But when Grand Theft Auto V’s sales cooled off in 2015, the company’s ROA plummeted.

For most of the past decade, the company’s Uniform ROA has stayed at or above 40%, with returns only slipping in the past few years.

Investors now expect the company’s Uniform ROA to rebound to 50%, well below its 2014 peak.

This indicates the market has doubts about Take-Two, even though the launch of GTA VI could be one of the biggest in gaming history.

It’s too early to tell if GTA VI will live up to the hype. However, gamers can’t wait to get their hands on it.

When GTA V was released, it generated $800 million in sales within 24 hours. In just three days, it hit $1 billion.

The company’s flagship franchise has pumped money into the business for more than a decade. Yet, investors have doubts how Take-Two could benefit from the next iteration.

Momentum is building for GTA VI’s release, and that’s setting up a blockbuster year for the video game publisher.

Best regards,

Joel Litman & Rob Spivey
Chief Investment Officer &
Director of Research
at Valens Research