GDEV Inc (GDEV) Q3 2024 Earnings Call Highlights: Surpassing Expectations Amidst Strategic ...

GuruFocus News
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Release Date: November 14, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • GDEV Inc (NASDAQ:GDEV) reported a 5% quarter-over-quarter revenue growth, surpassing analyst expectations for both revenue and adjusted EBITDA.

  • The company is focusing on long-term product improvements to enhance player engagement and retention, which is expected to drive sustainable growth.

  • GDEV Inc (NASDAQ:GDEV) has strengthened its leadership team with the appointment of Olga Lasko Tova as Chief Operating Officer, bringing valuable managerial expertise.

  • The company has increased its marketing investments by EUR 9 million year-over-year, aligning with its strategic plan to explore new growth opportunities.

  • GDEV Inc (NASDAQ:GDEV) executed a one-for-ten stock split and announced an at-the-market offering to improve stock liquidity and appeal, resulting in a 15-fold increase in average daily trading volume.

Negative Points

  • Despite quarter-over-quarter growth, GDEV Inc (NASDAQ:GDEV) experienced a 9% year-over-year revenue decline, primarily due to a decrease in bookings.

  • The company is still feeling the effects of underinvestment in marketing from 2022, impacting booking dynamics over recent quarters.

  • Net profit decreased to EUR 15 million in Q3 2024 from EUR 24 million in the same period last year, attributed to lower revenue and higher marketing expenses.

  • The gaming landscape is highly competitive, and GDEV Inc (NASDAQ:GDEV) faces challenges in adapting to rapidly changing player preferences and gameplay trends.

  • The company is in a transformation phase, which may lead to uncertainties and potential risks in achieving its long-term strategic goals.

Q & A Highlights

Q: How successful has the launch of Pixel Gun on Steam been, and what impact has it had on user growth? A: Roman, Chief Corporate Development Officer, stated that the launch was a huge success, with initial interest stabilizing at around 2,500 to 3,000 concurrent users, growing month over month. The company is focusing on product improvements to better cater to the Steam audience.

Q: Can you provide an update on the ATM offering and how you plan to allocate capital for growth? A: Alexander, CFO, explained that the ATM was launched to bolster liquidity rather than for immediate capital needs. The company is holding cash for potential future developments, including M&A opportunities, but currently has no specific plans.

Q: Are there any new game developments or franchises in the pipeline? A: Roman mentioned that the company has several games in development, with some showing promising metrics and entering the scaling phase. Details will be shared as they progress.

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