Revenues and Adjusted EBITDA grew QoQ in the
Third Quarter
Updating FY2022 Guidance to reflect recent
acquisition of Brainium
PLAYSTUDIOS, Inc. (NASDAQ: MYPS) (“PLAYSTUDIOS” or the
“Company”), the developer of the playAWARDS loyalty platform and an
award-winning developer of free-to-play mobile and social games,
today announced financial results for the third quarter ended
September 30, 2022.
Third Quarter Financial Highlights
- Revenue was $72.1 million during the third quarter of 2022,
compared to $70.6 million during the third quarter of 2021.
- Net income was $3.6 million during the third quarter of 2022,
compared to $11.2 million during the third quarter of 2021.
- AEBITDA, a non-GAAP financial measure defined below, was $9.8
million during the third quarter of 2022, compared to $9.6 million
during the third quarter of 2021.
Andrew Pascal, Chief Executive Officer of PLAYSTUDIOS,
commented, “We had a strong third quarter and I’m proud of how our
team performed. Results showed both annual and quarterly momentum,
with many of our recent initiatives beginning to bear fruit.
Against an economic and industry backdrop that remains challenging,
we believe our performance is particularly noteworthy. We were able
to hold DAU and MAU largely flat versus the second quarter of 2022,
while growing ARPDAU in our suite of social casino games. We made
substantial progress in our two new gaming initiatives, Tetris and
myVEGAS Bingo, and are encouraged about how they are positioned for
2023. Updated versions of the games will be available in the new
year, with playAWARDS fully integrated on both products. Similar to
its impact on our core suite of games, we expect a loyalty lift in
both Tetris and myVEGAS Bingo. playAWARDS continued to grow in the
quarter and currently includes nearly 600 unique awards for our
millions of connected users.”
He added “Of course the big news was our acquisition of Brainium
and its collection of 10 highly engaging casual games with nearly 2
million DAU. We view Brainium as an excellent complement to our
existing game portfolio and significant for our playAWARDS
expansion. It’s early days, but integration is going smoothly and
we couldn’t be happier. Even after this impactful acquisition, we
maintain a very healthy balance sheet, no borrowings, and full
access to our revolving credit facility.”
Recent Business Highlights
- Completed the transformative acquisition of Brainium, which is
immediately accretive to AEBITDA margins. Expect Brainium to be a
significant contributor to our business and believe there are
numerous opportunities for synergies with our existing
business.
- Advanced playAWARDS by adding AMC and Cinemark to our network
this quarter. Overall partners growth was 43% quarter-over-quarter
with reward purchases reaching 553,000 units this quarter.
- Made considerable technological and design progress on our two
new internal game initiatives; Tetris and myVEGAS Bingo. Both games
are showing improving metrics and are primed to be positive
contributors in 2023.
- playAWARDS is set to be fully integrated into Tetris and
myVEGAS Bingo in 2023. Integration will also happen into Brainium’s
suite of games in 2023. Through this, playAWARDS’ reach will expand
significantly next year, allowing it to further establish itself as
a world class rewards program.
- Continued to scale studios in Vietnam and Serbia, which now
account for nearly 40% of our total development capacity.
- Added head count and continued to make progress in our Web3.0
strategy.
Outlook
The Company is updating its expectation for full-year 2022
revenue to be in the range of $275.0 million to $285.0 million. In
addition, the full-year AEBITDA is now expected to be in the range
of $32.0 million to $35.0 million.
We have not provided the most directly comparable GAAP measure
for our 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) 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
Soduku. 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—Key Performance Indicators” section 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. For both
PLAYSTUDIOS and Brainium, average DAU is calculated as the average
of the DAU for each day during the period presented. We use DAU as
a measure 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. Average MAU is calculated as the
average of MAU for each calendar month during the period presented.
We use MAU as a measure 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. Average DPU is
calculated as the average of the DPU for each day during the period
presented. We use DPU to 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. Average Daily Payer Conversion is calculated as the average
DPU divided by average DAU for a given period. We use Daily Payer
Conversion to 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
not adjusted for refunds. Purchases only include purchases of
real-world partner rewards and exclude any PLAYSTUDIOS digital
rewards. The Company does not receive any compensation or revenues
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 Adjusted Earnings Before
Interest Taxes Depreciation and Amortization (“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 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 AEBITDA margin, a non-GAAP measure, which we calculate as
AEBITDA as a percentage of net revenues.
We believe that the presentation of 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. 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 AEBITDA differently, and as a result, our measure of 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 Income (Loss) to 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, our liquidity and capital resources, the
development and release plans of our games, our plans to
commercialize the playAWARDS platform as a stand-alone service for
use by third parties, our increased capacity and use of personnel
in European and Asian studios, and our mergers and acquisition
strategy, (including our acquisition of Brainium and its expected
impact and financial performance) 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,” “anticipates,” “intends,” “believes,”
“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; 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, 2021 filed with the Securities
and Exchange Commission (the “SEC”) on March 3, 2022, and in other
filings we make with the SEC from time to time, including our
Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 2022, to be filed with the SEC. 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.
SOURCE: PLAYSTUDIOS, Inc.
PLAYSTUDIOS, INC.
CONSOLIDATED STATEMENT OF
OPERATIONS
(Unaudited and in thousands,
except per share data)
Three Months Ended September
30,
Nine Months Ended September
30,
2022
2021
2022
2021
Net revenues
$
72,127
$
70,571
$
210,931
$
215,490
Operating expenses:
Cost of revenue(1)
21,703
22,282
63,657
69,802
Selling and marketing
19,249
19,274
59,336
60,461
Research and development
15,110
14,509
46,561
46,551
General and administrative
9,864
5,789
28,763
22,390
Depreciation and amortization
8,583
7,213
25,265
20,145
Restructuring and related
796
2,303
10,968
2,379
Total operating costs and expenses
75,305
71,370
234,550
221,728
Income (loss) from operations
(3,178
)
(799
)
(23,619
)
(6,238
)
Other income (expense), net:
Change in fair value of warrant
liabilities
4,676
11,876
1,139
11,986
Interest expense, net
843
(57
)
1,050
(206
)
Other income (expense), net
(475
)
(113
)
(836
)
(242
)
Total other income (expense), net
5,044
11,706
1,353
11,538
Income before income taxes
1,866
10,907
(22,266
)
5,300
Income tax benefit (expense)
1,763
329
6,186
4,819
Net income (loss)
$
3,629
$
11,236
$
(16,080
)
$
10,119
Net income (loss) per share attributable
to Class A and Class B common stockholders:
Basic
$
0.03
$
0.09
$
(0.13
)
$
0.09
Diluted
$
0.02
$
0.08
$
(0.13
)
$
0.08
Weighted average shares of common stock
outstanding:
Basic
129,032
125,823
127,529
106,880
Diluted
146,920
138,795
127,529
120,516
(1)
Amounts exclude depreciation and amortization.
PLAYSTUDIOS, INC.
CONSOLIDATED BALANCE
SHEETS
(Unaudited and in thousands,
except par value amounts)
September 30,
2022
December 31,
2021
ASSETS
Current assets:
Cash and cash equivalents
$
212,069
$
213,502
Receivables
19,214
20,693
Prepaid expenses
2,675
5,059
Income tax receivable
1,801
2,117
Other current assets
977
413
Total current assets
236,736
241,784
Property and equipment, net
13,930
5,289
Internal-use software, net
35,418
43,267
Goodwill
6,235
5,059
Intangibles, net
16,018
18,755
Deferred income taxes
13,186
6,282
Other long-term assets
12,422
14,408
Total non-current assets
97,209
93,060
Total assets
$
333,945
$
334,844
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
5,320
7,793
Warrant liabilities
3,590
6,521
Accrued liabilities
18,442
15,599
Total current liabilities
27,352
29,913
Other long-term liabilities
3,090
1,464
Total liabilities
$
30,442
$
31,377
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.0001 par value
(100,000 shares authorized, no shares issued and outstanding as of
September 30, 2022 and December 31, 2021)
—
—
Class A common stock, $0.0001 par value
(2,000,000 shares authorized, 113,407 and 110,066 shares issued and
outstanding as of September 30, 2022 and December 31, 2021,
respectively)
11
11
Class B common stock, $0.0001 par value
(25,000 shares authorized, 16,457 shares issued and outstanding as
of September 30, 2022 and December 31, 2021.
2
2
Additional paid-in capital
285,199
268,522
Retained earnings
18,459
34,539
Accumulated other comprehensive income
(168
)
393
Total stockholders’ equity
303,503
303,467
Total liabilities and stockholders’
equity
$
333,945
$
334,844
PLAYSTUDIOS, INC. RECONCILIATION OF
NET INCOME (LOSS) TO AEBITDA (Unaudited and in thousands,
except percentages)
The following table sets forth the reconciliation of AEBITDA and
AEBITDA margin, which we calculate as AEBITDA as a percentage of
net revenues, to net income (loss) and net income (loss) margin,
the most directly comparable GAAP measures.
Three Months Ended September
30,
Nine Months Ended September
30,
2022
2021
2022
2021
Net income (loss)
$
3,629
$
11,236
$
(16,080
)
$
10,119
Depreciation & amortization
8,583
7,213
25,265
20,145
Income tax (benefit) expense
(1,763
)
(329
)
(6,186
)
(4,819
)
Stock-based compensation expense
3,554
833
13,563
3,680
Change in fair value of warrant
liability
(4,676
)
(11,876
)
(1,139
)
(11,986
)
Special infrequent(1)
—
—
—
7,500
Restructuring and related(2)
796
2,303
10,969
2,379
Other
(367
)
267
(213
)
546
AEBITDA
9,757
9,647
26,179
27,564
GAAP revenue
72,127
70,571
210,931
215,490
Margin as a % of
revenue
Net income (loss) margin
5.0
%
15.9
%
(7.6
)%
4.7
%
AEBITDA margin
13.5
%
13.7
%
12.4
%
12.8
%
(1)
Amounts reported during the nine months ended September 30, 2021
consist of a transaction bonus and a charitable contribution per
the terms of the merger agreement related to the Acies Merger.
(2)
Amounts reported during the three and nine months ended
September 30, 2021 consist of severance-related costs and fees
related to evaluating various merger and acquisition opportunities.
Amounts reported during the three months ended September 30, 2022
consist of fees related to potential mergers and acquisitions.
Amounts reported during the nine months ended September 30, 2022
consist of (i) non-cash impairment charge related to the suspension
of Kingdom Boss development, (ii) fees related to evaluating
various merger and acquisition opportunities, and (iii) fees
related to the Tender Offer for the Warrants.
PLAYSTUDIOS, INC.
SUPPLEMENTAL DATA – KEY
PERFORMANCE INDICATORS
(Unaudited and in thousands,
except percentages and ARPDAU)
Three Months Ended September
30,
Nine Months Ended September
30,
2022
2021
Change
% Change
2022
2021
Change
% Change
Average DAU
1,462
1,173
289
24.6
%
1,495
1,228
267
21.7
%
Average MAU
6,683
3,571
3,112
87.1
%
6,743
3,867
2,876
74.4
%
Average DPU
29
33
(4
)
(12.1
)%
30
34
(4
)
(11.8
)%
Average Daily Payer Conversion
2.0
%
2.8
%
(0.8
)%
(28.6
)%
2.0
%
2.8
%
(0.8
)%
(28.6
)%
ARPDAU (in dollars)
$
0.52
$
0.65
$
(0.13
)
(20.0
)%
$
0.51
$
0.64
$
(0.13
)
(20.3
)%
PLAYSTUDIOS, INC.
SUPPLEMENTAL DATA – PLAYAWARDS
PLATFORM METRICS
(Unaudited and in thousands,
except available rewards)
Three Months Ended September
30,
Nine Months Ended September
30,
2022
2021
Change
% Change
2022
2021
Change
% Change
Available Rewards (in units)
595
516
79
15.3
%
549
455
94
20.7
%
Purchases (in units)
553
570
(17
)
(3.0
%)
1,712
1,488
224
15.1
%
Retail Value of Purchases (in dollars)
$
31,409
$
37,389
$
(5,980
)
(16.0
%)
$
97,591
$
85,622
$
11,969
14.0
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221108005364/en/
PLAYSTUDIOS CONTACTS
Investor Relations IR@playstudios.com
Media Relations media@playstudios.com
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