Release Date: August 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- DoubleUGames Co Ltd (XKRX:192080, Financial) achieved a record revenue of KRW163.1 billion in Q2 2024, marking a 13.3% year-over-year growth.
- Operating income reached KRW67.1 billion, with a margin of 41.1%, up 33.4% year-over-year.
- EBITDA was KRW70.2 billion, with a margin of 43.0%, up 34.5% year-over-year, demonstrating strong profitability.
- Net income was KRW64.2 billion, achieving the largest net income in the company's history.
- The company has a strong cash position with net cash reserves of KRW640 billion, which will be used for growth through new businesses and M&A.
Negative Points
- Igaming revenue decreased by 2.7% quarter-over-quarter to KRW10.8 billion due to seasonality and conservative marketing investments.
- Personnel expenses increased by 13.5% quarter-over-quarter to KRW21.8 billion, returning to previous levels after a one-time expense reduction.
- Marketing costs were down 24.3% quarter-over-quarter and 35.6% year-over-year, indicating a reduction in marketing efforts.
- The social casino market recorded a quarter-over-quarter growth rate of minus 2.7% in Q2 due to seasonality and other factors.
- DoubleU casino showed a slowdown in revenue growth, requiring new strategies and updates to improve performance.
Q & A Highlights
Q&A Highlights from DoubleU Games Co Ltd (XKRX:192080) Q2 2024 Earnings Call
Q: You have decreased marketing spending while revenues have shown very good results, especially in Social Casino. How did you achieve this efficiency? Can you specify any methods or channels used?
A: (Choi Jaeyoung, CFO) We focused on retaining existing users who had previously downloaded our games but left. By improving retention activities and strengthening our marketing creatives, we enhanced marketing efficiency. We are now more focused on retention rather than just user acquisition.
Q: Can you specify the areas of business you plan to target for M&A in the future?
A: (Choi Jaeyoung, CFO) We are reviewing M&A candidates in both game and non-game areas. For games, we are looking at rising stars in countries like Turkey and Israel. For non-games, we are considering B2C apps related to fitness or wellness that are subscription-based. Our focus remains on the North American market and game industries.
Q: What is the impact of potential reductions in app fees by Google and Apple on your business?
A: (Choi Jaeyoung, CFO) In Europe, we could receive some discounts from Apple, but the impact on our financial statements is not significant. We believe that if we apply for fee reduction promotions, we may benefit from them in the future.
Q: How do you see the future revenue growth for DoubleU Casino, given the recent slowdown?
A: (Choi Jaeyoung, CFO) We are benchmarking DoubleDown Casino, which is outperforming the market, to apply similar strategies to DoubleU Casino. We plan to simplify content and features and adopt meta features in the second half of the year to drive a rebound.
Q: What are your expectations for Super Nation's profitability and revenue growth in Q3?
A: (Choi Jaeyoung, CFO) Europe is on summer break, so we expect similar levels to Q2. However, we will gradually launch marketing efforts after mid-August. Our marketing and data experts will visit Malta to optimize these activities.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
