Tapinator Announces Q1 2024 Financial Results

Rhea-AI Summary

Tapinator (OTC: TAPM) reported its unaudited financial results for Q1 2024, revealing a 16% YoY increase in revenue to $1.2 million and a 5% YoY increase in bookings to $1.2 million. Net income dropped by 29% YoY to $144,000, and adjusted EBITDA decreased by 15% YoY to $144,000. The basic and fully diluted EPS were $0.05.

Operating income saw a 17% increase to $21,417, while the net income margin fell from 19% to 12%. Tapinator maintains its focus on key products like Video Poker Classic and Blackjack Live Casino, with significant updates planned for 2024. The company is also exploring AI-driven enhancements and alternative growth opportunities outside the mobile gaming sector.

Positive

• Revenue increased by 16% year-over-year to $1.2 million.
• Bookings increased by 5% year-over-year to $1.2 million.
• Operating income increased by 17% year-over-year to $21,417.
• Basic and fully diluted EPS were $0.05.
• Continued investment in key products like Video Poker Classic and Blackjack Live Casino.
• Significant updates planned for existing games in Q2 and Q3 of 2024.
• Exploring AI-driven enhancements for voice and chat functionalities.

Negative

• Net income dropped by 29% year-over-year to $144,000.
• Adjusted EBITDA decreased by 15% year-over-year to $144,000.
• Net income margin fell from 19% to 12%.
• Video Poker Classic bookings fell by 64% year-over-year.
• Continued industry-wide marketing challenges due to privacy changes.

- Revenue Increases 16% Year-Over-Year to $1.2 Million 
- Bookings^* Increase 5% Year-Over-Year to $1.2 Million
- Net Income of $144k Compared to Previous Year Net income of $202k
- Adjusted EBITDA^* Decreases 15% Year-Over-Year to $144k
- Basic and Fully Diluted EPS of $0.05

NEW YORK, May 14, 2024 /PRNewswire/ -- Tapinator, Inc. (OTC: TAPM) ("Tapinator," the "Company," "we," "our" or "us"), a developer and publisher of category leading games for mobile platforms, today announced unaudited financial results for the three months ended March 31, 2024, and the filing of its quarterly report for the periods ended March 31, 2024 and 2023.

The quarterly report and financial statements have been published on OTC Markets and may be found at http://www.otcmarkets.com/stock/TAPM/disclosure.  The results provided below replace, in their entirety, any guidance or projections previously issued by the Company.

For the three months ended March 31, 2024, Tapinator achieved revenue and bookings^*of approximately $1.2 million, and net income and adjusted EBITDA^* of approximately $144,000.  The Company's quarterly revenue, bookings*, net income and adjusted EBITDA^* represent year-over-year change of 16%, 5%, -29% and 15%, respectively.  For the quarter, the Company also announced basic and fully diluted net income of $0.05 per share.

^*A table has been included in this press release with non-GAAP adjustments to the Company's revenue resulting in bookings (a non-GAAP measure) and non-GAAP adjustments to the Company's net income, resulting in adjusted EBITDA (a non-GAAP measure) for the relevant periods.

Financial Highlights

	Three Months Ended
	March 31
	2024	2023	% Ch.
GAAP Results:
Revenue	$1,235,284	$1,064,853	16 %
Operating Income	$21,417	$18,234	17 %
Net Income	$144,123	$201,699	-29 %
Net Income margin %	12 %	19 %
Net Income Per Share - Basic	$0.05	$0.07
Net Income Per Share - Diluted	$0.05	$0.07
Weighted avg. common shares outstanding - basic	2,725,439	2,725,439
Weighted avg. common shares outstanding - diluted	2,725,439	2,725,527
Non-GAAP Results:
Bookings:
Category Leading Games	$1,141,484	$1,047,223	9 %
Rapid-Launch Games	24,680	68,060	-64 %
Total Bookings	$1,166,164	$1,115,283	5 %
Adjusted EBITDA	$143,736	$124,699	15 %
Adjusted EBITDA Margin %	12 %	12 %

Ilya Nikolayev, CEO of Tapinator, commented, "After a challenging 2023 for Tapinator and for the mobile gaming industry overall, we are pleased that metrics have stabilized and, for Q1 2024, year-over-year, we have seen an increase in overall revenue and an increase in bookings for our Category Leading Games. We continue to see industry-wide marketing challenges, based on privacy changes that have made player targeting and tracking more difficult. However, we have increased our investment in marketing to put systems and processes in place which we believe will, over time, result in more favorable customer acquisition costs and an increase in player lifetime value.

"From a product development perspective, we continue to invest in our key Category Leading Games, including Video Poker Classic. As we noted previously, our newest title is Blackjack Live Casino, a "stadium" game with live hosts that is a social product at its core. The game features real-time, live hosts who engage with players, via voice, and provide commentary on gameplay, strategy, player chat, and more. We have been releasing monthly updates to the game, with a multitude of new features and optimizations. For Q2 and Q3 of 2024, we have two significant updates planned along with the upcoming release of the Android version of the game. We are encouraged by the monetization metrics that we are seeing. With our game updates, we are very focused on improving retention which, we believe, is key to our success. 

"While building Blackjack Live Casino, within the context of a "live host" experience, we have spent significant time on voice and chat functionality and how these features can be expanded and enriched via AI. We are currently exploring opportunities at the intersection of voice, chat, and AI and we hope to provide an update on these efforts in Q3. As noted previously, given the maturation of mobile gaming, we are also seeking alternative growth opportunities for our shareholders within other industries/markets that can offer more significant growth prospects for the Company. We have evaluated numerous other opportunities to drive shareholder value over the past year and continue to evaluate such opportunities."  

Non-GAAP Financial Measures*
We have provided in this release the non-GAAP financial measures of Bookings and adjusted EBITDA as a supplement to the measures of Revenue and Operating which are prepared in accordance with United States generally accepted accounting principles ("GAAP"). Management uses Bookings and adjusted EBITDA internally in analyzing our financial results to assess operational performance and liquidity. The presentation of Bookings and adjusted EBITDA is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. We believe that both management and investors benefit from referring to Bookings and adjusted EBITDA in assessing our performance and when planning, forecasting, and analyzing future periods. We believe Bookings and adjusted EBITDA are useful to investors because it allows for greater transparency with respect to key financial metrics we use in making operating decisions and because our investors and analysts use them to help assess the health of our business. Below, we have provided reconciliations between our historical Bookings and adjusted EBITDA to the most directly comparable GAAP financial measures.  Some limitations of Bookings and adjusted EBITDA are as follows:

• Bookings do not reflect that we defer and recognize online game revenue over the estimated life of durable virtual goods;
  
  
• Adjusted EBITDA does not include the impact of stock-based expense, impairment of previously capitalized software or intangible assets previously acquired, gain on digital asset dividends & airdrops, gain on sale of digital assets and gain on sale of investments;
  
  
• Adjusted EBITDA does not reflect income tax expense;
  
  
• Adjusted EBITDA does not include other income or expenses, which includes foreign exchange gains and losses, interest income or expense, and gain on extinguishment of debt;
  
  
• Adjusted EBITDA excludes depreciation and amortization of intangible assets and impairment of capitalized software. Although depreciation, amortization, and impairment of capitalized software are non-cash charges, the assets being depreciated, amortized, or impaired may have to be replaced in the future; and
  
  
• Other companies, including companies in our industry, may calculate adjusted EBITDA differently or not at all, which will reduce their usefulness as a comparative measure.

Because of these limitations, you should consider Bookings and adjusted EBITDA, along with other financial performance measures, including Revenue, Net Income (Loss), Basic and Diluted Net Income (Loss) Per Share, Cash Flow from Operations, Operating Income (Loss), and our other financial results presented in accordance with GAAP.

NFT500 Supplemental Information – Summary Collection Metrics*

	Totals as of 12/31/2023	Q1 2024	Cumulative Totals as of 03/31/2024
# of NFTs Collected	724	1	725
# of NFTs Sold	-292	-24	-316
# of NFTs Held, Cumulatively	432	409	409
Cost of NFTs Collected	$    2,925,228		$   2,925,228
Proceeds from Sale of Collected NFTs	(1,600,482)	(300,315)	(1,900,797)
Proceeds from Sale of Digital Asset Dividends & Airdrops	(185,816)	-	(185,816)
Cost of NFTs Collected, Net of Sales Proceeds	$    1,138,931	$      (300,315)	$      838,616

*We are no longer actively investing in the NFT ecosystem, and we have been selectively selling digital assets under market conditions that we deem appropriate. 

Reconciliation of GAAP to Non-GAAP Results

	Three Months Ended
	March 31
	2024	2023
Reconciliation of Revenue to Bookings:
Revenue	$1,235,284	$1,064,853
Change in deferred revenue	(69,120)	50,430
Bookings	$1,166,164	$1,115,283
Reconciliation of Net Income to Adjusted EBITDA:
Net income	$144,123	$201,699
Interest income, net	(1,006)	(446)
Income tax expense, net	17,500	37,700
Impairment of digital assets	101,283	-
Amortization of software development costs	119,107	100,337
Depreciation and amortization of other assets	3,212	3,212
Gain on sale of digital assets	(240,483)	(220,719)
Stock based compensation	-	2,916
Adjusted EBITDA	$143,736	$124,699

 

About Tapinator
Tapinator Inc. (OTC: TAPM) develops and publishes Category Leading Games for mobile platforms. Tapinator's library includes more than 300 titles that, collectively, have achieved over 500 million mobile downloads, including notable properties such as Video Poker Classic, Keno Vegas, and Blackjack Live Casino.  We generate revenues from our mobile games via consumer transactions, including in-app purchases and subscriptions, and through the sale of branded advertisements. Founded in 2013, we are headquartered in New York, with product teams located in North America and Europe.

Forward Looking Statements
To the extent that statements contained in this press release are not descriptions of historical facts regarding Tapinator, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as "believe," "goal," "seek," "plan," "feel," "opinion," "may," "will," "expect," "anticipate," "estimate," "intend," "target," and similar expressions (as well as other words or expressions referencing future events, conditions, or circumstances) are intended to identify forward-looking statements. These forward-looking statements include, among other things, our belief that our increased investment in marketing to put systems and processes in place to attract and retain players will, over time, result in more favorable customer acquisition costs and an increase in player lifetime value, our plan to release two significant updates to Blackjack Live Casino along with the upcoming release of the Android version of the game in Q2 and Q3 of 2024 and our belief that focusing on improving player retention is key to our success. Forward-looking statements are subject to risks and uncertainties that could cause our future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Except as required by law, Tapinator undertakes no obligation to update or revise any forward-looking statements. The quoting and trading of the Company's common stock on the OTC Marketplace is often thin and characterized by wide fluctuations in trading prices, due to many factors that may have little to do with the Company's operations or business prospects. As a result, there may be volatility in the market price of the shares of the Company's common stock for reasons unrelated to operating performance. Moreover, the OTC Marketplace is not a stock exchange, and trading of securities on it is often more sporadic than trading of securities listed on a national securities exchange. Accordingly, stockholders may have difficulty reselling any of their shares. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of the Company, please see the Company's Supplemental Information Report as filed with the OTC Markets on October 20, 2021 and as updated from time to time.

CONTACT:
Tapinator Investor Relations
investor.relations@tapinator.com
914.930.6232

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SOURCE Tapinator, Inc.

FAQ

What was Tapinator's Q1 2024 revenue?

Tapinator's Q1 2024 revenue was $1.2 million, a 16% increase year-over-year.

How did Tapinator's bookings perform in Q1 2024?

Bookings increased by 5% year-over-year to $1.2 million in Q1 2024.

What was Tapinator's net income in Q1 2024?

Net income for Tapinator in Q1 2024 was $144,000, down 29% year-over-year.

What is Tapinator's adjusted EBITDA for Q1 2024?

Tapinator's adjusted EBITDA for Q1 2024 was $144,000, a 15% decrease year-over-year.

What are Tapinator's EPS figures for Q1 2024?

Tapinator reported basic and fully diluted EPS of $0.05 for Q1 2024.

What challenges is Tapinator facing in the market?

Tapinator faces industry-wide marketing challenges due to privacy changes affecting player targeting and tracking.

What are Tapinator's plans for its key products in 2024?

Tapinator plans significant updates for its key products like Video Poker Classic and Blackjack Live Casino in Q2 and Q3 of 2024.