DoubleDown CEO talks up igaming potential amid Q2 growth
DoubleDown Q2 revenue was 6.7% lower year-on-year at $75.2m (£59.0m/€68.5m). The social games developer said the drop reflects a return to normality for players following the lifting of Covid restrictions and a return to usual consumer entertainment-focused behaviour.
The developer also noted the impact of changes in player behaviours due to inflation and global economic concerns.
DoubleDown CEO talks up real-money opportunities
However, CEO Kim remained upbeat over future prospects, pointing to the pending acquisition of SuprNation as a highlight. The deal, which is due to complete later this year, sees DoubleDown expand into real-money gaming.
“Our ability to consistently generate positive cash flow, combined with our strong balance sheet with more than $150.0m (£117.6m/€136.6m) in uncommitted capital, provides us with the flexibility to invest in new gaming categories and high addressable market opportunities,” Kim said.
“These include igaming through our pending acquisition of SuprNation, which is expected to close later this year.
“We are encouraged by our performance in the first half of the year and expect to continue generating attractive cash flow over the balance of 2023 and beyond.”
DoubleDown Q2: Higher revenue, lower costs
Group revenue for the quarter amounted to $75.2m, down from $80.6m last year and 3.1% behind $77.6m in Q1.
Monthly active users (MAUs) also declined 22.5% year-on-year to 1.8 million, as did daily active users (DAUs) to 793,000. However, average monthly revenue per player increased slightly to $235.
Looking at spending, operating costs were 62.9% lower at $47.7m. This was primarily due to last year’s figures including expenses related to the Washington class action case.
DoubleDown also noted $4.4m in finance-related income, including interest income and foreign currency translation gains. As such, pre-tax profit reached $31.9m, compared to a $46.1m loss last year.
The developer paid $7.6m in tax, leaving a net profit of $24.4m, in contrast to a $34.1m loss in 2022. After also accounting for pension adjustments and foreign currency translation, net profit was $24.2m, compared to a $37.3m net loss in 2022.
Adjusted EBITDA also increased from $25.0m to $27.6m.
DoubleDown’s H1 follows similar pattern to Q2
Turning to H1, revenue for the six months to 30 June was $152.8m, an 8.0% drop from the previous year.
Operating costs were reduced by 47.3% to $99.9m, again due to costs related to the legal settlement. Finance income reached $9.4m, resulting in $62.3m in pre-tax profit, in stark contrast to the $21.6m net loss in 2022.
DoubleDown paid $14.3m in tax, leaving $48.0m in net profit, compared to a $15.6m loss last year. When including pension adjustments and foreign currency translation, net profit was $46.6m, in comparison to a $20.8m net loss in the previous year.
In addition, adjusted EBITDA edged up 2.1% to $53.0m.
“DoubleDown’s attractive business model combined with our disciplined focus on managing operating expenses delivers solid adjusted EBITDA margins as demonstrated by the 34.7% margin through the first six months of 2023,” Kim said.