Third Quarter Revenue of $71.2 million and Net
loss of $3.1 million
Consolidated AEBITDA of $14.6 million
PLAYSTUDIOS, Inc. (NASDAQ: MYPS) (“PLAYSTUDIOS” or the
“Company”), an award-winning developer of free-to-play mobile and
social games and the developer of the playAWARDS loyalty platform,
today announced financial results for the third quarter ended
September 30, 2024.
Andrew Pascal, Chairman and Chief Executive Officer of
PLAYSTUDIOS, commented, “Despite continued industry pressures,
revenues and consolidated AEBITDA came in above consensus
expectations this quarter. AEBITDA margins increased to 20.5% and
we believe further gains are achievable. We made progress on our
many strategic initiatives this quarter including raising the
monetization of our games, expanding the Tetris Brand, a full
integration of playAWARDS, furthering our DTC initiative, and
evaluating new growth opportunities.”
He continued, “We are also announcing our newly instituted
reinvention program. The program will meaningfully lower our cost
structure, increase our profitability, and better position our
company for long term growth.”
Third Quarter Financial Highlights
- Revenue was $71.2 million during the third quarter of
2024, compared to $75.9 million during the third quarter of
2023.
- Net loss was $3.1 million during the third quarter of
2024, representing a net loss margin of 4.3%, compared to net loss
of $3.8 million during the third quarter of 2023, representing a
net loss margin of 5.0%.
- Consolidated AEBITDA, a non-GAAP financial measure
defined below, was $14.6 million during the third quarter of 2024,
compared to $13.5 million during the third quarter of 2023.
- Consolidated AEBITDA Margins were 20.5% in the quarter,
a 270 basis point increase versus the third quarter of 2023 and a
100 basis point increase versus the second quarter of 2024.
- KPIs playGAMES. During the third quarter of 2024,
PLAYSTUDIOS had Average DAU and Average MAU of 3.0 million and 12.7
million, respectively. ARPDAU was $0.26.
- KPIs playAWARDS. During the third quarter of 2024,
players purchased 451,300 rewards with a retail value of $25
million.
- Liquidity. As of September 30, 2024, cash and cash
equivalents on the balance sheet was $105.2 million. PLAYSTUDIOS’
$81 million revolving credit facility remains undrawn.
- Shares outstanding. As of September 30, 2024, the
Company had 125.2 million shares outstanding.
Recent Business Highlights
- Launched our reinvention program that will result in a material
reduction in costs and increase in profitability. The program will
include a reduction in workforce, suspension of sub-scale game
development, and consolidation of key business functions, which we
expect to result in normalized annual cost savings of approximately
$25 million to $30 million.
- Resumed the repurchase of stock in the open market. Year to
date, we have repurchased an aggregate of 13.6 million shares of
our Class A common stock at an average price of $2.15 per share.
The remaining availability under our $50 million stock repurchase
program was $45.5 million after the most recent purchases.
- myVEGAS and Brainium saw double digit increases in ARPDAU in
the third quarter compared to the previous year. Each game
continues to benefit from recent efforts to increase
monetization.
- Recently acquired Pixode Games Limited has been integrated into
our operations and we have begun work on our new Tetris title. Our
goal is to have the game complete and in the market in 2025.
- Successfully hosted the inaugural myVIP World Tournament of
Slots. The tournament drove increased engagement in our games and
elevated awareness of our brands.
Outlook
The Company is maintaining full year 2024 guidance of net
revenue in the range of $285 to $295 million and Consolidated
AEBITDA in the range of $55 to $60 million.
We have not provided the most directly comparable GAAP measure
for our Consolidated AEBITDA outlook because certain items that are
part of the projected non-GAAP financial measure are outside of our
control or cannot be reasonably estimated without unreasonable
effort.
Conference Call Details
PLAYSTUDIOS will host a conference call at 5:00 p.m. Eastern
Time today, which will include a brief discussion of the results
followed by a question and answer session.
The call will be accessible via the Internet through
https://ir.playstudios.com or by calling (866) 405-1203 for
domestic callers and (201) 689-8432 for international callers.
A replay of the call will be archived at
https://ir.playstudios.com.
About PLAYSTUDIOS, Inc.
PLAYSTUDIOS (Nasdaq: MYPS) is the creator of the groundbreaking
playAWARDS loyalty platform is a publisher and developer of
award-winning mobile games, including the iconic Tetris® mobile
app, Pop! Slots, myVEGAS Slots, myVEGAS Blackjack, myKONAMI Slots,
myVEGAS Bingo, MGM Slots Live, Solitaire, Spider Solitaire and
Sudoku. The playAWARDS loyalty platform enables players to earn
real-world rewards from a global collection of iconic hospitality,
entertainment, and leisure brands. playAWARDS partners include MGM
Resorts International, Wolfgang Puck, Norwegian Cruise Line,
Resorts World, IHG, Bowlero, Gray Line Tours, and Hippodrome Casino
among others. Founded by a team of veteran gaming, hospitality, and
technology entrepreneurs, PLAYSTUDIOS apps combine the best
elements of popular casual games with compelling real-world
benefits. To learn more about PLAYSTUDIOS, visit
playstudios.com.
Performance Indicators
We manage our business by regularly reviewing several key
operating metrics to track historical performance, identify trends
in player activity, and set strategic goals for the future. Our key
performance metrics are impacted by several factors that could
cause them to fluctuate on a quarterly basis, such as platform
providers’ policies, seasonality, player connectivity, and the
addition of new content to games. We believe these measures are
useful to investors for the same reasons. The key performance
indicators may differ from similarly titled measures presented by
other companies. For more information on our key performance
indicators, please refer to the definitions below and the
“Supplemental Data—playGAMES Key Performance Indicators” and
“Supplemental Data—playAWARDS Key Performance Indicators”sections
of this press release.
Daily Active Users (“DAU”): DAU is
defined as the number of individuals who played a game on a
particular day. We track DAU by the player ID, which is assigned
for each game installed by an individual. As such, an individual
who plays two different PLAYSTUDIOS games on the same day is
counted as two DAU while an individual who plays the same
PLAYSTUDIOS game on two different devices is counted as one DAU.
Brainium tracks DAU by app instance ID, which is assigned to each
installation of a game on a particular device. As such, an
individual who plays two different Brainium games on the same day
is counted as two DAU while an individual who plays the same game
on two different devices is counted as two DAU. The term “Average
DAU” is defined as the average of the DAU, determined as described
above, for each day during the period presented. We use DAU and
Average DAU as measures of audience engagement to help us
understand the size of the active player base engaged with our
games on a daily basis.
Monthly Active Users (“MAU”): MAU
is defined as the number of individuals who played a game in a
particular month. As with DAU, an individual who plays two
different PLAYSTUDIOS games in the same month is counted as two MAU
while an individual who plays the same game on two different
devices is counted as one MAU, and an individual who plays two
different Brainium games on the same day is counted as two MAU
while an individual who plays the same game on two different
devices is counted as two MAU. The term “Average MAU” is defined as
the average of the MAU, determined as described above, for each
calendar month during the period presented. We use MAU and Average
MAU as measures of audience engagement to help us understand the
size of the active player base engaged with our games on a monthly
basis.
Daily Paying Users (“DPU”): DPU is
defined as the number of individuals who made a purchase in a
mobile game during a particular day. As with DAU and MAU, we track
DPU based on account activity. As such, an individual who makes a
purchase on two different games in a particular day is counted as
two DPU while an individual who makes purchases in the same game on
two different devices is counted as one DPU. The term “Average DPU”
is defined as the average of the DPU, determined as described
above, for each day during the period presented. We use DPU and
Average DPU to help us understand the size of our active player
base that makes in-game purchases. This focus directs our strategic
goals in setting player acquisition and pricing strategy.
Daily Payer Conversion: Daily Payer
Conversion is defined as DPU as a percentage of DAU on a particular
day. Daily Player Conversion is also sometimes referred to as
“Percentage of Paying Users” or “PPU”. The term “Average Daily
Payer Conversion” is defined as the Average DPU divided by the
Average DAU for a given period. We use Daily Payer Conversion and
Average Daily Payer Conversion to help us understand the
monetization of our active players.
Average Daily Revenue Per DAU
(“ARPDAU”): ARPDAU is defined for a given period as the
average daily revenue per Average DAU, and is calculated as game
and advertising revenue for the period, divided by the number of
days in the period, divided by the Average DAU during the period.
We use ARPDAU as a measure of overall monetization of our active
players.
playAWARDS Platform Metrics
Available Rewards: Available
Rewards is defined as the monthly average number of unique rewards
available in our applications’ rewards stores. A reward appearing
in more than one application’s reward store is counted only once. A
reward is counted only once irrespective of the inventory available
through that reward. For example, one reward for a free night in a
hotel room with ten rooms available for such free night is counted
as one reward. Available Rewards only include real-world partner
rewards and exclude PLAYSTUDIOS digital rewards. We use Available
Rewards as a measure of the value and potential impact of the
program for an interested player. It is assumed that the greater
the variety and breadth of rewards offered, the more likely players
will be to ascribe value to the program.
Purchases: Purchases is defined as
the total number of rewards purchased for the period identified in
which a player exchanges loyalty points for a reward. Purchases are
net of refunds. Purchases only include purchases of real-world
partner rewards and exclude any PLAYSTUDIOS digital rewards.
Purchases are redeemed by the player directly with the rewards
partner within the specified terms and conditions of the reward.
The Company does not receive any compensation or revenue from
Purchases. We use Purchases as a measure of audience interest and
engagement with our playAWARDS platform.
Retail Value of Purchases: Retail
Value of Purchases is defined as the cumulative retail value of all
rewards listed as Purchases for the period identified. The retail
value of each reward listed as Purchases is the retail value as
determined by the partner upon creation of the reward. In the case
where the retail value of a reward adjusts depending on time of
redemption, the average retail value is used. Retail Value of
Purchases only include the retail value of real-world partner
rewards and exclude the cost of any PLAYSTUDIOS branded
merchandise. We use Retail Value of Purchases to help us understand
the real-world value of the rewards that are purchased by our
players.
Non-GAAP Financial Measures
To provide investors with information in addition to results as
determined by GAAP, the Company discloses Consolidated Adjusted
Earnings Before Interest Taxes Depreciation and Amortization
(“Consolidated AEBITDA”) as a non-GAAP measure that management
believes provides useful information to investors. This measure is
not a financial measure calculated in accordance with GAAP and
should not be considered as a substitute for revenue, net income or
any other operating performance measure calculated in accordance
with GAAP.
We define Consolidated AEBITDA as net income (loss) before
interest, income taxes, depreciation and amortization,
restructuring and related costs (consisting primarily of severance
and other restructuring related costs), stock-based compensation
expense, and other income and expense items (including special
infrequent items, foreign currency gains and losses, and other
non-cash items). We also present Consolidated AEBITDA margin, a
non-GAAP measure, which we calculate as Consolidated AEBITDA as a
percentage of net revenue.
We believe that the presentation of Consolidated AEBITDA
provides useful information to investors regarding the Company’s
results of operations because the measure assists both investors
and management in analyzing and benchmarking the performance and
value of our business. Consolidated AEBITDA provides an indicator
of performance that is not affected by fluctuations in certain
costs or other items. Accordingly, management believes that this
measure is useful for comparing general operating performance from
period to period, and management relies on this measure for
planning and forecasting of future periods. Additionally, this
measure allows management to compare results with those of other
companies that have different financing and capital structures.
However, other companies may define Consolidated AEBITDA
differently, and as a result, our measure of Consolidated AEBITDA
may not be directly comparable to that of other companies. For
further information regarding these non-GAAP measures, including
the reconciliation of these non-GAAP financial measures to their
most directly comparable GAAP financial measures, please refer to
the “Reconciliation of Net (Loss) Income to Consolidated AEBITDA”
section of this press release.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements regarding our future financial and
operating performance (including statements regarding outlook or
guidance), our liquidity and capital resources, the development and
release plans of our games, the impact of business restructuring
and cost control initiatives including estimated amounts and timing
of anticipated cost reductions, and our mergers and acquisition
strategy, all of which involve risks and uncertainties. Actual
results may differ materially from the results predicted, and
reported results should not be considered as an indication of
future performance. Forward-looking statements include all
statements that are not historical facts and can be identified by
terms such as “may,” “might,” “will,” “should,” “expects,” “plans,”
“projects,” “anticipates,” “intends,” “believes,” “goal,” “work
towards,” “estimates,” “predicts,” “potential” or “continue,” the
negative of these terms and other comparable terminology that
conveys uncertainty of future events or outcomes. These
forward-looking statements involve known and unknown risks,
uncertainties, assumptions and other factors that may cause actual
results to differ materially from statements made in this press
release, including our ability to develop and publish our games;
risks related to defects, errors, or vulnerabilities in our games
and IT infrastructure; our ability to attract new, and retain
existing, players of our games; the failure to timely develop and
achieve market acceptance of new games and maintain the popularity
of our existing games; rapidly evolving technological developments
in the gaming market; competition in the industry in which we
operate; our financial performance; our ability to execute merger
and acquisition transactions; legal and regulatory developments;
risks associated with our international operations; geopolitical
events and conditions; risks associated with business restructuring
efforts, including the potential impact of restructuring activities
on our business operations and financial performance; and general
market, political, economic and business conditions. Other
potential risks and uncertainties that could cause actual results
to differ from the results predicted include, among others, those
risks and uncertainties included under the captions “Risk Factors”
and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” in our Annual Report on Form 10-K for
the fiscal year ended December 31, 2023 filed with the Securities
and Exchange Commission (the “SEC”) on March 12, 2024, and in other
filings we make with the SEC from time to time. All information
provided in this release is based on information available to us as
of the date of this press release and any forward-looking
statements contained herein are based on assumptions that we
believe are reasonable as of this date. Undue reliance should not
be placed on the forward-looking statements in this press release,
which are inherently uncertain. We undertake no duty to update this
information unless required by law.
PLAYSTUDIOS, INC. CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited and in
thousands, except per share data)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Net revenue
$
71,229
$
75,858
$
221,647
$
233,774
Operating expenses:
Cost of revenue(1)
17,832
19,862
54,851
58,276
Selling and marketing
15,116
18,786
50,756
55,283
Research and development
16,654
17,367
51,418
53,503
General and administrative
11,581
10,747
35,005
33,688
Depreciation and amortization
11,593
11,537
34,813
33,686
Restructuring and related
3,231
1,280
5,248
7,112
Total operating costs and expenses
76,007
79,579
232,091
241,548
Loss from operations
(4,778
)
(3,721
)
(10,444
)
(7,774
)
Other income (expense), net:
Change in fair value of warrant
liabilities
276
4,216
929
1,381
Interest income, net
1,127
1,364
3,921
3,521
Other (loss) income, net
(256
)
(198
)
(626
)
906
Total other income, net
1,147
5,382
4,224
5,808
(Loss) income before income taxes
(3,631
)
1,661
(6,220
)
(1,966
)
Income tax benefit (expense)
534
2,139
(55
)
2,437
Net (loss) income
$
(3,097
)
$
3,800
$
(6,275
)
$
471
Net loss per share attributable to Class A
and Class B common stockholders:
Basic
$
(0.02
)
$
0.03
$
(0.05
)
$
—
Diluted
$
(0.02
)
$
0.03
$
(0.05
)
$
—
Weighted average shares of common stock
outstanding:
Basic
125,007
133,351
130,997
132,546
Diluted
125,007
149,655
130,997
148,911
(1)
Amounts exclude depreciation and
amortization.
PLAYSTUDIOS, INC. CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited and in thousands, except
par value amounts)
September 30,
2024
December 31,
2023
ASSETS
Current assets:
Cash and cash equivalents
$
105,170
$
132,889
Receivables, net
28,775
30,465
Prepaid expenses and other current
assets
10,323
11,529
Total current assets
144,268
174,883
Property and equipment, net
17,532
17,549
Operating lease right-of-use assets
10,545
9,369
Intangibles assets and internal-use
software, net
99,778
110,933
Goodwill
52,222
47,133
Deferred income taxes
2,699
2,764
Other long-term assets
3,506
3,690
Total non-current assets
186,282
191,438
Total assets
$
330,550
$
366,321
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
4,190
1,907
Operating lease liabilities, current
3,486
4,236
Accrued and other current liabilities
27,010
39,882
Total current liabilities
34,686
46,025
Minimum guarantee liability
18,000
24,000
Deferred income taxes
553
1,198
Operating lease liability, non-current
7,513
5,699
Contingent consideration
3,255
—
Other long-term liabilities
1,362
1,048
Total non-current liabilities
30,683
31,945
Total liabilities
$
65,369
$
77,970
Stockholders’ equity:
Preferred stock, $0.0001 par value
(100,000 shares authorized, no shares issued and outstanding as of
September 30, 2024 and December 31, 2023)
—
—
Class A common stock, $0.0001 par value
(2,000,000 shares authorized, 127,007 and 122,923 shares issued,
and 108,729 and 118,200 shares outstanding as of September 30, 2024
and December 31, 2023, respectively)
11
12
Class B common stock, $0.0001 par value
(25,000 shares authorized, and 16,457 and 16,457 shares issued and
outstanding as of September 30, 2024 and December 31, 2023,
respectively.
2
2
Additional paid-in capital
324,077
310,944
Retained earnings
(8,912
)
(2,637
)
Accumulated other comprehensive income
(695
)
124
Treasury stock, at cost, 18,279 and 4,723
shares at September 30, 2024 and December 31, 2023,
respectively
(49,302
)
(20,094
)
Total stockholders’ equity
265,181
288,351
Total liabilities and stockholders’
equity
$
330,550
$
366,321
PLAYSTUDIOS, INC. RECONCILIATION OF
NET (LOSS) INCOME TO CONSOLIDATED AEBITDA (Unaudited and in
thousands, except percentages)
The following table sets forth the reconciliation of net (loss)
income and net (loss) income margin to Consolidated AEBITDA and
Consolidated AEBITDA margin, respectively, which we calculate as
Consolidated AEBITDA as a percentage of net revenue. Net (loss)
income and net (loss) income margin are the most directly
comparable GAAP measures.
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Revenue
$
71,229
$
75,858
$
221,647
$
233,774
Net (loss) income
$
(3,097
)
$
3,800
$
(6,275
)
$
471
Net (loss) income margin
(4.3
)%
5.0
%
(2.8
)%
0.2
%
Adjustments:
Depreciation & amortization
11,593
11,537
34,813
33,686
Income tax expense
(534
)
(2,139
)
55
(2,437
)
Stock-based compensation expense
4,584
4,344
14,308
14,391
Change in fair value of warrant
liability
(276
)
(4,216
)
(929
)
(1,381
)
Change in fair value of contingent
consideration
—
—
—
(950
)
Restructuring and related(1)
3,231
1,280
5,248
7,112
Other, net(2)
(878
)
(1,081
)
(3,145
)
(3,328
)
Consolidated AEBITDA
14,623
13,525
44,075
47,564
Consolidated AEBITDA Margin
20.5
%
17.8
%
19.9
%
20.3
%
(1)
Amounts reported during the three and nine
months ended September 30, 2023 relate to non-cash impairment
charges related to certain investments and fees related to
evaluating various merger, acquisition and restructuring
opportunities. Amounts reported during the three and nine months
ended September 30, 2024 relate to internal reorganization
costs, including severance-related costs, fees related to
evaluating various merger and acquisition opportunities, and legal
fees and other costs incurred in connection with litigation arising
out of the Acies Merger transaction.
(2)
Amounts reported in “Other, net” include
interest expense, interest income, gains/losses from equity
investments, foreign currency gains/losses, and non-cash
gains/losses on the disposal of assets.
PLAYSTUDIOS, INC. SUPPLEMENTAL DATA -
SEGMENT INFORMATION (Unaudited and in thousands, except
percentages)
The following table sets forth the financial data for our
reportable segments.
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Net revenue
playGAMES
71,226
75,857
221,642
229,602
playAWARDS
3
1
5
4,172
Reportable segment net revenue
71,229
75,858
221,647
233,774
AEBITDA
playGAMES
23,233
21,640
68,604
65,842
playAWARDS
(3,991
)
(4,180
)
(11,089
)
(6,517
)
Reportable segment AEBITDA
19,242
17,460
57,515
59,325
Other operating expense
Corporate and other
4,619
3,935
13,440
11,761
Restructuring expenses
3,231
1,280
5,248
7,112
Other reconciling items
(7
)
85
150
149
Stock-based compensation
4,584
4,344
14,308
14,391
Depreciation and amortization
11,593
11,537
34,813
33,686
24,020
21,181
67,959
67,099
Non-operating income
Change in fair value of warrant
liabilities
276
4,216
929
1,381
Interest income, net
1,127
1,364
3,921
3,521
Other (expense) income, net
(256
)
(198
)
(626
)
906
1,147
5,382
4,224
5,808
(Loss) income before income
taxes
(3,631
)
1,661
(6,220
)
(1,966
)
Income tax benefit (expense)
534
2,139
(55
)
2,437
Net (loss) income
$
(3,097
)
$
3,800
$
(6,275
)
$
471
Segment AEBITDA margin:
playGAMES
32.6
%
28.5
%
31.0
%
28.7
%
playAWARDS
nm
nm
nm
(156.2
)%
nm - not meaningful
PLAYSTUDIOS, INC. SUPPLEMENTAL
DATA – PLAYGAMES KEY PERFORMANCE INDICATORS (Unaudited and in
thousands, except percentages and ARPDAU)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
Change
% Change
2024
2023
Change
% Change
Average DAU
2,961
3,520
(559
)
(15.9
)%
3,225
3,579
(354
)
(9.9
)%
Average MAU
12,658
13,712
(1,054
)
(7.7
)%
13,669
13,557
112
0.8
%
Average DPU
23
26
(3
)
(11.5
)%
25
27
(2
)
(7.4
)%
Average Daily Payer Conversion
0.8
%
0.8
%
—
pp
—
%
0.8
%
0.8
%
—
pp
—
%
ARPDAU (in dollars)
$
0.26
$
0.23
$
0.03
13.0
%
$
0.25
$
0.24
$
0.01
4.2
%
pp = percentage points
PLAYSTUDIOS, INC. SUPPLEMENTAL
DATA – PLAYAWARDS KEY PERFORMANCE INDICATORS (Unaudited and in
thousands, except for available rewards)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
Change
% Change
2024
2023
Change
% Change
Available Rewards (in units)
547
598
(51
)
(8.5
%)
543
578
(35
)
(6.1
%)
Purchases (in units)
451
433
18
4.2
%
1,472
1,338
134
10.0
%
Retail Value of Purchases
$
24,980
$
24,165
$
815
3.4
%
$
96,977
$
78,145
$
18,832
24.1
%
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