Allied Gaming & Entertainment Announces Second Quarter 2023 Financial Results
- Allied Gaming & Entertainment reports Q2 2023 revenues of $3.3 million, up 182% YoY
- Restructuring aims to optimize resources and provide greater clarity on business outlook
- Costs and expenses decreased by 2.4%
- Net loss for Q2 2023 was $0.7 million
“We are thrilled to announce our second quarter revenues of
Second Quarter 2023 Financial Results
Revenues: Total revenues of
Costs and expenses: Total costs and expenses were
Net loss for the second quarter of 2023 was
Furthermore, adjusted EBITDA loss was
Balance Sheet
As of June 30, 2023, the Company had a cash and short-term investments position of
During the second quarter, the Company bought back a total of 372,436 shares of its common stock at an average selling price of
Operational Update
Allied Esports experienced strong demand and produced 99 events in the second quarter of 2023, with 41 proprietary events and 58 third-party events. Third-party events were highlighted by EStars presents Elder Scrolls Online, Ross Video Customer Appreciation, WPT Event, Final Two Episodes of ELEVATED, Licensing Awards Reception, Golden Knights Watch Party and TL LOL Champions of the Rift Community Event.
During the quarter, Season 2 of ELEVATED, Presented by Progressive Insurance, was released. Each episode was hosted by a different One True King member, who have a collective reach of over 35 million followers across their channels. Since the debut, the season has generated a total viewership of 12.7 million, with 89.5 million live minutes watched and 11.9 million total unique viewers.
Also during the quarter, the Company announced the extension of its exclusive naming rights agreement with HyperX/HP, which ensures that AGAE’s flagship arena will remain known as HyperX Arena Las Vegas. Moving forward, HyperX/HP gaming related products will also be available for sale inside the arena.
Second Quarter 2023 Conference Call
The Company will host a conference call today at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time to discuss its second quarter 2023 financial results. Participants may join the conference call by dialing 1-877-407-0792 (
A live webcast of the conference call will also be available on Allied Gaming & Entertainment’s Investor Relations site at ir.alliedgaming.gg. Additionally, financial information presented on the call will be available on Allied Gaming & Entertainment’s Investor Relations site. For those unable to participate in the conference call, a telephonic replay of the call will also be available shortly after the completion of the call, until 11:59 p.m. Eastern Time on Thursday, August 24, 2023, by dialing 1-844-512-2921 (
About Allied Gaming & Entertainment
Allied Gaming & Entertainment Inc. (Nasdaq: AGAE) is a global experiential entertainment company focused on providing a growing world of gamers with unique experiences through renowned assets, products and services. For more information, visit alliedgaming.gg.
Non-GAAP Financial Measures
As a supplement to our financial measures presented in accordance with
The Company provides net income (loss) and earnings (loss) per share in accordance with GAAP. In addition, the Company provides EBITDA (defined as GAAP net income (loss) from continuing operations before interest (income) expense, income taxes, depreciation, and amortization). The Company defines “Adjusted EBITDA” as EBITDA excluding certain non-cash charges, such as stock-based compensation, inducement expense, extinguishment losses and impairment losses.
In the future, the Company may also consider whether other items should also be excluded in calculating the non-GAAP financial measures used by the Company. Management believes that the presentation of these non-GAAP financial measures provides investors with additional useful information to measure the Company’s financial and operating performance. In particular, these measures facilitate comparison of our operating performance between periods and help investors to better understand the operating results of the Company by excluding certain items that may not be indicative of the Company’s core business, operating results, or future outlook. Additionally, we consider quantitative and qualitative factors in assessing whether to adjust for the impact of items that may be significant or that could affect an understanding of our ongoing financial and business performance or trends. Internally, management uses these non-GAAP financial measures, along with others, in assessing the Company’s operating results, measuring compliance with any applicable requirements of the Company’s debt financing agreements in place at such time, as well as in planning and forecasting.
The Company’s non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles, and our non-GAAP definitions of the “EBITDA” and “Adjusted EBITDA” do not have a standardized meaning. Therefore, other companies may use the same or similarly named measures, but include or exclude different items, which may not provide investors a comparable view of the Company’s performance in relation to other companies.
Management compensates for the limitations resulting from the exclusion of these items by considering the impact of the items separately and by considering the Company’s GAAP, as well as non-GAAP, financial results and outlook, and by presenting the most comparable GAAP measures directly ahead of non-GAAP measures, and by providing a reconciliation that indicates and describes the adjustments made.
Forward Looking Statements
This communication contains certain forward-looking statements under federal securities laws. Forward-looking statements may include our statements regarding our goals, beliefs, strategies, objectives, plans, including product and service developments, future financial conditions, results or projections or current expectations. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “intend” or “continue,” the negative of such terms, or other comparable terminology. These statements are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results to be materially different from those contemplated by the forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside our control, that could cause actual results or outcomes to differ materially from those discussed in these forward-looking statements. The inclusion of such information should not be regarded as a representation by the Company, or any person, that the objectives of the Company will be achieved. Important factors, among others, that may affect actual results or outcomes include: risks associated with the future direction or governance of the Company; our ability to execute on our business plan; the substantial uncertainties inherent in the acceptance of existing and future products and services; the ability to retain key personnel; potential litigation; general economic and market conditions impacting demand for our services; a change in our plans to retain or invest the net cash proceeds from the WPT sale transaction; our inability to enter into one or more future acquisition or strategic transactions using the net proceeds from the WPT sale transaction; and our ability, or a decision not to pursue strategic options for the esports business. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. The business and operations of AGAE are subject to substantial risks, which increase the uncertainty inherent in the forward-looking statements contained in this communication. Except as required by law, we undertake no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Further information on potential factors that could affect our business and results is described under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on March 24, 2023, as well as subsequent reports we file with the SEC. Readers are also urged to carefully review and consider the various disclosures we made in such Annual Report on Form 10-K and in subsequent reports with the SEC.
Allied Gaming & Entertainment Inc. and Subsidiaries | ||||||||
Condensed Consolidated Balance Sheets | ||||||||
June 30, | December 31, | |||||||
2023 |
2022 |
|||||||
(unaudited) | ||||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ |
21,192,610 |
|
$ |
11,167,442 |
|
||
Short-term investments |
|
54,500,000 |
|
|
70,000,000 |
|
||
Interest receivable |
|
1,494,049 |
|
|
677,397 |
|
||
Accounts receivable |
|
1,013,805 |
|
|
72,739 |
|
||
Prepaid expenses and other current assets |
|
231,637 |
|
|
459,274 |
|
||
Total Current Assets |
|
78,432,101 |
|
|
82,376,852 |
|
||
Restricted cash |
|
5,000,000 |
|
|
5,000,000 |
|
||
Property and equipment, net |
|
3,202,048 |
|
|
4,005,622 |
|
||
Digital assets |
|
49,300 |
|
|
49,761 |
|
||
Intangible assets, net |
|
685,739 |
|
|
72,786 |
|
||
Deposits |
|
379,105 |
|
|
379,105 |
|
||
Operating lease right-of-use asset |
|
5,376,317 |
|
|
5,845,549 |
|
||
Total Assets | $ |
93,124,610 |
|
$ |
97,729,675 |
|
||
Liabilities and Stockholders' Equity | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ |
576,545 |
|
$ |
317,561 |
|
||
Accrued expenses and other current liabilities |
|
1,731,728 |
|
|
1,645,379 |
|
||
Deferred revenue |
|
119,752 |
|
|
108,428 |
|
||
Operating lease liability, current portion |
|
1,320,272 |
|
|
1,227,164 |
|
||
Total Current Liabilities |
|
3,748,297 |
|
|
3,298,532 |
|
||
Operating lease liability, non-current portion |
|
5,857,779 |
|
|
6,527,075 |
|
||
Total Liabilities |
|
9,606,076 |
|
|
9,825,607 |
|
||
Commitments and Contingencies (Note 4) | ||||||||
Stockholders' Equity | ||||||||
Preferred stock, |
|
- |
|
|
- |
|
||
Common stock, |
|
3,909 |
|
|
3,909 |
|
||
Additional paid in capital |
|
198,598,596 |
|
|
198,526,614 |
|
||
Accumulated deficit |
|
(112,820,573 |
) |
|
(110,235,568 |
) |
||
Accumulated other comprehensive income |
|
221,555 |
|
|
219,675 |
|
||
Treasury stock, at cost, 2,059,786 and 581,746 shares at June 30, 2023 and December 31, 2022, respectively |
|
(2,484,953 |
) |
|
(610,562 |
) |
||
Total Stockholders' Equity |
|
83,518,534 |
|
|
87,904,068 |
|
||
Total Liabilities and Stockholders' Equity | $ |
93,124,610 |
|
$ |
97,729,675 |
|
||
The accompanying notes are an integral part of these condensed consolidated financial statements. | ||||||||
Allied Gaming & Entertainment Inc. and Subsidiaries | ||||||||||||||||
Condensed Consolidated Statements of Operations and Comprehensive Loss | ||||||||||||||||
(unaudited) | ||||||||||||||||
For the Three Months Ended | For the Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2023 |
2022 |
2023 |
2022 |
|||||||||||||
Revenues: | ||||||||||||||||
In-person | $ |
1,267,773 |
|
$ |
1,129,371 |
|
$ |
2,461,103 |
|
$ |
2,182,437 |
|
||||
Multiplatform content |
|
2,000,322 |
|
|
28,463 |
|
|
2,000,424 |
|
|
1,387,451 |
|
||||
Total Revenues |
|
3,268,095 |
|
|
1,157,834 |
|
|
4,461,527 |
|
|
3,569,888 |
|
||||
Costs and Expenses: | ||||||||||||||||
In-person (exclusive of depreciation and amortization) |
|
643,831 |
|
|
933,314 |
|
|
1,316,053 |
|
|
1,672,288 |
|
||||
Multiplatform content (exclusive of depreciation and amortization) |
|
1,517,311 |
|
|
43,364 |
|
|
1,517,707 |
|
|
989,876 |
|
||||
Selling and marketing expenses |
|
66,941 |
|
|
62,131 |
|
|
121,539 |
|
|
131,169 |
|
||||
General and administrative expenses |
|
2,223,025 |
|
|
2,766,422 |
|
|
4,766,372 |
|
|
6,364,292 |
|
||||
Depreciation and amortization |
|
212,218 |
|
|
808,233 |
|
|
790,778 |
|
|
1,616,845 |
|
||||
Impairment of digital assets |
|
- |
|
|
164,411 |
|
|
- |
|
|
164,411 |
|
||||
Total Costs and Expenses |
|
4,663,326 |
|
|
4,777,875 |
|
|
8,512,449 |
|
|
10,938,881 |
|
||||
Loss From Operations |
|
(1,395,231 |
) |
|
(3,620,041 |
) |
|
(4,050,922 |
) |
|
(7,368,993 |
) |
||||
Other Income (Expense): | ||||||||||||||||
Other income (expense), net |
|
(11,113 |
) |
|
(73,225 |
) |
|
16,342 |
|
|
(79,932 |
) |
||||
Interest income, net |
|
715,126 |
|
|
4,315 |
|
|
1,449,575 |
|
|
8,777 |
|
||||
Total Other Income (Expense) |
|
704,013 |
|
|
(68,910 |
) |
|
1,465,917 |
|
|
(71,155 |
) |
||||
Net loss |
|
(691,218 |
) |
|
(3,688,951 |
) |
|
(2,585,005 |
) |
|
(7,440,148 |
) |
||||
Other comprehensive income: | ||||||||||||||||
Foreign currency translation adjustments |
|
- |
|
|
(71,595 |
) |
|
1,880 |
|
|
(58,631 |
) |
||||
Total Comprehensive Loss | $ |
(691,218 |
) |
$ |
(3,760,546 |
) |
$ |
(2,583,125 |
) |
$ |
(7,498,779 |
) |
||||
Basic and Diluted Net Loss (Income) per Common Share | ||||||||||||||||
Continuing operations | $ |
(0.02 |
) |
$ |
(0.09 |
) |
$ |
(0.07 |
) |
$ |
(0.19 |
) |
||||
Weighted Average Number of Common Shares Outstanding: | ||||||||||||||||
Basic and Diluted |
|
37,199,100 |
|
|
39,116,907 |
|
|
37,559,922 |
|
|
39,090,830 |
|
||||
The accompanying notes are an integral part of these condensed consolidated financial statements. |
Non-GAAP Financial Measures
EBITDA and Adjusted EBITDA are non-GAAP financial measures and should not be considered as a substitute for net income (loss), operating income (loss) or any other performance measure derived in accordance with
The following table presents a reconciliation of EBITDA and Adjusted EBITDA from net loss, AGAE’s most directly comparable financial measure calculated and presented in accordance with GAAP.
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||
2023 |
2022 |
2023 |
2022 |
|||||||||
Net loss | $ |
(691,218) |
$ |
(3,688,951) |
$ |
(2,585,005) |
$ |
(7,440,148) |
||||
Interest income, net |
|
(715,126) |
|
(4,315) |
|
(1,449,575) |
|
(8,777) |
||||
Depreciation and amortization |
|
212,218 |
|
808,233 |
|
790,778 |
|
1,616,845 |
||||
EBITDA |
|
(1,194,126) |
|
(2,885,033) |
|
(3,243,802) |
|
(5,832,080) |
||||
Stock compensation |
|
66,856 |
|
153,093 |
|
71,982 |
|
554,389 |
||||
Impairment expense |
|
- |
|
164,411 |
|
- |
|
164,411 |
||||
Adjusted EBITDA | $ |
(1,127,270) |
$ |
(2,731,940) |
$ |
(3,171,820) |
$ |
(5,277,691) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20230809685655/en/
Investor Contact:
Tyler Drew
Addo Investor Relations
ir@alliedgaming.gg
Source: Allied Gaming & Entertainment, Inc.
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