In total, net income declined to $36.4m from $90.0 million in the prior year period, a 59.6% collapse. Meanwhile, earnings before interest, tax, depreciation, and amortisation (EBITDA) fell to $238.9m, compared to $264.4m the previous year, a 9.6% decline.
This can be largely explained by increasing costs as revenue remained stagnant. Total costs and expenses for the three months ending 30 June rose to $568.3 from $493.8m in the same period last year. This $74.5m increase is a 13.1% change and more than explains the decline in net income.
Increased money spent on research and development, as well as general and administrative costs, largely drove the rise in expenses.
EBIDTA margin also fell to 36.2% from 40.1% for the three months ending 30 June 2021.
The business pointed to the rise of its casual portfolio as a potential bright spot, with revenue growing 10.0% year on year, to comprise 53.3% of total revenue – with revenues standing at $351.5 million and $308.1 million for casual and casino themed games respectively.
Other non-revenue metrics were signs for optimism including an increase in daily payer conversion to 3.2%, up from 2.9% in Q2 the previous year.
Playtika chief executive officer Robert Antokol remained bullish in the face of the news: “We are proud of our performance in the second quarter in a challenging economic environment.
“We maintained growth in key strategic areas including our casual game portfolio and direct-to-consumer platforms, and demonstrated the resiliency of our business. Looking ahead to the second half, we are focused on the continued introduction of exciting new content for our existing portfolio of games and on our new game development initiatives as well.”
Despite the decline in net income, the company remained in a strong liquidity position, with $1.8bn available including $1.2bn in cash reserves as well as $600m in additional borrowing capacity.
President and chief financial officer Craig Abrahams highlighted attempts to improve optimisation and efficiency.
“We continued to optimise our business during the second quarter as we focus on execution,” he said.
“We took actions to improve our core operations and enhance product roadmaps, while adapting to maintain margin and strong free cash flow generation. We will continue to look for efficiency opportunities across our organisation and capitalise on investments that position us for long-term sustainable growth.”