Cover
Cover - $ / shares | 6 Months Ended | |
Jun. 30, 2024 | Aug. 05, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2024 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2024 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-39274 | |
Entity Registrant Name | GAN Limited | |
Entity Central Index Key | 0001799332 | |
Entity Incorporation, State or Country Code | D0 | |
Entity Address, Address Line One | 400 Spectrum Center Drive | |
Entity Address, Address Line Two | Suite 1900 | |
Entity Address, City or Town | Irvine | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92618 | |
City Area Code | (833) | |
Local Phone Number | 565-0550 | |
Title of 12(b) Security | Ordinary shares, par value $0.01 | |
Trading Symbol | GAN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 45,472,877 | |
Entity Listing, Par Value Per Share | $ 0.01 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Current assets | |||
Cash | $ 36,861 | $ 38,578 | |
Accounts receivable, net of credit losses of $158 and $244 at June 30, 2024 and December 31, 2023, respectively | 8,847 | 11,417 | |
Prepaid expenses | 3,686 | 3,344 | |
Other current assets | 4,461 | 3,202 | |
Total current assets | 53,855 | 56,541 | |
Capitalized software development costs, net | 7,704 | 8,370 | |
Intangible assets, net | 10,653 | 12,358 | |
Operating lease right-of-use assets | [1] | 3,822 | 4,340 |
Other assets | 5,152 | 5,895 | |
Total assets | 81,186 | 87,504 | |
Current liabilities | |||
Accounts payable | 6,255 | 6,971 | |
Accrued compensation and benefits | 7,202 | 7,849 | |
Accrued content license fees | 1,928 | 4,024 | |
Liabilities to users | 10,201 | 10,185 | |
Current operating lease liabilities | 811 | 804 | |
Other current liabilities | 8,217 | 6,891 | |
Total current liabilities | 34,614 | 36,724 | |
Deferred income taxes | 3,790 | 3,793 | |
Long-term debt | 44,498 | 42,189 | |
Non-current operating lease liabilities | 3,041 | 3,577 | |
Other liabilities | 5,394 | 5,825 | |
Total liabilities | 91,337 | 92,108 | |
Commitments and contingencies (Note 15) | |||
Shareholders’ equity (deficit) | |||
Ordinary shares, $0.01 par value, 100,000,000 shares authorized, 45,393,951 and 45,071,578 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively | 454 | 451 | |
Additional paid-in capital | 337,987 | 336,552 | |
Accumulated deficit | (315,196) | (309,305) | |
Accumulated other comprehensive loss | (33,396) | (32,302) | |
Total shareholders’ deficit | (10,151) | (4,604) | |
Total liabilities and shareholders’ equity (deficit) | $ 81,186 | $ 87,504 | |
[1]Operating lease right-of-use assets are recorded, net of accumulated amortization of $ 744 378 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Accounts receivable allowance for credit loss, current | $ 158 | $ 244 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 45,393,951 | 45,071,578 |
Common stock, shares outstanding | 45,393,951 | 45,071,578 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | ||
Income Statement [Abstract] | |||||
Revenue | $ 35,560 | $ 33,758 | $ 66,211 | $ 68,887 | |
Operating costs and expenses | |||||
Cost of revenue | [1] | 10,244 | 9,485 | 19,567 | 19,646 |
Sales and marketing | 7,056 | 7,324 | 13,073 | 14,508 | |
Product and technology | 8,137 | 11,238 | 17,753 | 20,816 | |
General and administrative | [1] | 7,980 | 10,029 | 15,139 | 20,035 |
Depreciation and amortization | 1,914 | 4,243 | 3,753 | 8,444 | |
Total operating costs and expenses | 35,331 | 42,319 | 69,285 | 83,449 | |
Operating income (loss) | 229 | (8,561) | (3,074) | (14,562) | |
Interest expense, net | 1,157 | 905 | 2,289 | 2,621 | |
Other loss (income), net | 27 | 8,358 | 1 | (934) | |
Loss before income taxes | (955) | (17,824) | (5,364) | (16,249) | |
Income tax expense | 776 | 585 | 527 | 659 | |
Net loss | $ (1,731) | $ (18,409) | $ (5,891) | $ (16,908) | |
Loss per share, basic | $ (0.04) | $ (0.42) | $ (0.13) | $ (0.39) | |
Loss per share, diluted | $ (0.04) | $ (0.42) | $ (0.13) | $ (0.39) | |
Weighted average ordinary shares outstanding, basic | 45,390,559 | 44,147,701 | 45,262,413 | 43,568,197 | |
Weighted average ordinary shares outstanding, diluted | 45,390,559 | 44,147,701 | 45,262,413 | 43,568,197 | |
[1]Excludes depreciation and amortization expense. |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Statement [Abstract] | ||||
Net loss | $ (1,731) | $ (18,409) | $ (5,891) | $ (16,908) |
Other comprehensive loss, net of tax | ||||
Foreign currency translation adjustments | (327) | 155 | (1,094) | 1,121 |
Comprehensive loss | $ (2,058) | $ (18,254) | $ (6,985) | $ (15,787) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Shareholders' (Deficit) Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Balance at Dec. 31, 2022 | $ 429 | $ 328,998 | $ (274,861) | $ (33,798) | $ 20,768 |
Balance, shares at Dec. 31, 2022 | 42,894,211 | ||||
Net income (loss) | 1,501 | 1,501 | |||
Foreign currency translation adjustments | 966 | 966 | |||
Share-based compensation | 1,382 | 1,382 | |||
Restricted share activity | $ 4 | 4 | |||
Restricted share activity, shares | 377,944 | ||||
Repurchase of restricted shares to pay tax liability (Note 7) | $ (1) | (78) | (79) | ||
Repurchase of restricted shares to pay tax liability (Note 7), shares | (49,157) | ||||
Issuance of ordinary shares upon ESPP purchases | $ 1 | 64 | 65 | ||
Issuance of ordinary shares upon ESPP purchases, shares | 57,960 | ||||
Balance at Mar. 31, 2023 | $ 433 | 330,366 | (273,360) | (32,832) | 24,607 |
Balance, shares at Mar. 31, 2023 | 43,280,958 | ||||
Balance at Dec. 31, 2022 | $ 429 | 328,998 | (274,861) | (33,798) | 20,768 |
Balance, shares at Dec. 31, 2022 | 42,894,211 | ||||
Net income (loss) | (16,908) | ||||
Balance at Jun. 30, 2023 | $ 447 | 333,938 | (291,769) | (32,677) | 9,939 |
Balance, shares at Jun. 30, 2023 | 44,683,215 | ||||
Balance at Mar. 31, 2023 | $ 433 | 330,366 | (273,360) | (32,832) | 24,607 |
Balance, shares at Mar. 31, 2023 | 43,280,958 | ||||
Net income (loss) | (18,409) | (18,409) | |||
Foreign currency translation adjustments | 155 | 155 | |||
Share-based compensation | 1,621 | 1,621 | |||
Restricted share activity | $ 1 | 1 | 2 | ||
Restricted share activity, shares | 148,080 | ||||
Issuance of ordinary shares upon exercise of stock options | |||||
Issuance of ordinary shares upon exercise of stock options, shares | 5,129 | ||||
Repurchase of restricted shares to pay tax liability (Note 7) | |||||
Repurchase of restricted shares to pay tax liability (Note 7), shares | (952) | ||||
Issuance of ordinary shares in connection with Content Provider Agreement | $ 13 | 1,950 | 1,963 | ||
Issuance of ordinary shares in connection with Content Provider Agreement, shares | 1,250,000 | ||||
Balance at Jun. 30, 2023 | $ 447 | 333,938 | (291,769) | (32,677) | 9,939 |
Balance, shares at Jun. 30, 2023 | 44,683,215 | ||||
Balance at Dec. 31, 2023 | $ 451 | 336,552 | (309,305) | (32,302) | (4,604) |
Balance, shares at Dec. 31, 2023 | 45,071,578 | ||||
Net income (loss) | (4,160) | (4,160) | |||
Foreign currency translation adjustments | (767) | (767) | |||
Share-based compensation | 840 | 840 | |||
Restricted share activity | $ 4 | (5) | (1) | ||
Restricted share activity, shares | 476,419 | ||||
Issuance of ordinary shares upon exercise of stock options | |||||
Issuance of ordinary shares upon exercise of stock options, shares | 5,778 | ||||
Repurchase of restricted shares to pay tax liability (Note 7) | $ (2) | (229) | (230) | ||
Repurchase of restricted shares to pay tax liability (Note 7), shares | (167,833) | ||||
Balance at Mar. 31, 2024 | $ 454 | 337,159 | (313,465) | (33,069) | (8,922) |
Balance, shares at Mar. 31, 2024 | 45,385,942 | ||||
Balance at Dec. 31, 2023 | $ 451 | 336,552 | (309,305) | (32,302) | (4,604) |
Balance, shares at Dec. 31, 2023 | 45,071,578 | ||||
Net income (loss) | $ (5,891) | ||||
Issuance of ordinary shares upon exercise of stock options, shares | 8,012 | ||||
Balance at Jun. 30, 2024 | $ 454 | 337,987 | (315,196) | (33,396) | $ (10,151) |
Balance, shares at Jun. 30, 2024 | 45,393,951 | ||||
Balance at Mar. 31, 2024 | $ 454 | 337,159 | (313,465) | (33,069) | (8,922) |
Balance, shares at Mar. 31, 2024 | 45,385,942 | ||||
Net income (loss) | (1,731) | (1,731) | |||
Foreign currency translation adjustments | (327) | (327) | |||
Share-based compensation | 831 | 831 | |||
Restricted share activity | |||||
Restricted share activity, shares | 8,195 | ||||
Issuance of ordinary shares upon exercise of stock options | |||||
Issuance of ordinary shares upon exercise of stock options, shares | 2,234 | ||||
Repurchase of restricted shares to pay tax liability (Note 7) | (3) | (3) | |||
Repurchase of restricted shares to pay tax liability (Note 7), shares | (2,420) | ||||
Balance at Jun. 30, 2024 | $ 454 | $ 337,987 | $ (315,196) | $ (33,396) | $ (10,151) |
Balance, shares at Jun. 30, 2024 | 45,393,951 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Cash Flows From Operating Activities | ||
Net loss | $ (5,891) | $ (16,908) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization of software and intangible assets | 2,953 | 7,708 |
Depreciation on property and equipment and finance lease right-of-use assets | 801 | 736 |
Non-cash interest and amortization of debt discount and debt issuance costs | 2,309 | 1,564 |
Share-based compensation expense | 1,641 | 3,049 |
Gain on extinguishment of content liability | (9,717) | |
Loss on extinguishment of debt | 8,784 | |
Deferred income tax | 118 | 324 |
Change in fair value of synthetic equity | 221 | |
Other | (86) | (149) |
Changes in operating assets and liabilities, net of acquisition: | ||
Accounts receivable | 948 | 3,902 |
Prepaid expenses | (397) | 993 |
Other current assets | (1,360) | (360) |
Other assets | 433 | (1,747) |
Accounts payable | (628) | (1,699) |
Accrued compensation and benefits | (459) | 2,191 |
Accrued content license fees | (434) | (308) |
Liabilities to users | 354 | (2,033) |
Other current liabilities | 1,409 | 1,171 |
Other liabilities | (802) | 930 |
Net cash provided by (used in) operating activities | 909 | (1,348) |
Cash Flows From Investing Activities | ||
Expenditures for capitalized software development costs | (933) | (1,987) |
Purchases of gaming licenses | (216) | (305) |
Purchases of property and equipment | (206) | (1,277) |
Net cash used in investing activities | (1,355) | (3,569) |
Cash Flows From Financing Activities | ||
Repurchase of restricted shares to pay tax liability | 3 | (409) |
Proceeds from issuance of long-term debt | 4,733 | |
Payment of debt issuance costs | (3,143) | |
Proceeds from issuance of ordinary shares under ESPP | 66 | |
Net cash provided by financing activities | 3 | 1,247 |
Effect of foreign exchange rates on cash | (1,274) | 1,137 |
Net decrease in cash | (1,717) | (2,533) |
Cash, beginning of period | 38,578 | 45,920 |
Cash, end of period | 36,861 | 43,387 |
Supplemental Cash Flow Information | ||
Interest | 1,068 | |
Income taxes | 37 | 158 |
Non-cash activities: | ||
Right-of-use asset obtained in exchange for new operating lease liability | 2,076 | |
Contract asset and contingent liability related to synthetic equity | $ 1,143 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 6 Months Ended |
Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS | NOTE 1 NATURE OF OPERATIONS GAN Limited (the “Parent,” and with its subsidiaries, collectively the “Company”) is an exempted company limited by shares, incorporated and registered in Bermuda. The Company is a business-to-business (“B2B”) supplier of a proprietary gaming system, GameSTACK™ (“GameSTACK”), which is used predominately by the U.S. land-based casino industry. For its B2B customers, GameSTACK is a turnkey technology solution for regulated real money internet gambling (“real money iGaming” or “RMiG”), online sports gaming, and virtual simulated gaming (“SIM”). In addition, the Company’s B2B segment offers GAN Sports, an in-house online and retail sports betting technology platform, through internet connected self-service kiosks deployed at casino properties and mobile solutions. The Company is also a business-to-consumer (“B2C”) developer and operator of an online sports betting and casino platform under its “Coolbet” brand, providing international users with access through www.coolbet.com to its sportsbook, casino games and poker products. The Company operates its B2C segment in markets across Northern Europe, Latin America, and Canada. On November 7, 2023, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with SEGA SAMMY CREATION INC., a Japanese corporation (“SEGA SAMMY CREATION”), and Arc Bermuda Limited, a Bermuda exempted company limited by shares and a wholly-owned subsidiary of SEGA SAMMY CREATION (“Merger Sub”), pursuant to which, subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will be merged with and into the Company, with the Company surviving the merger as a wholly-owned subsidiary of SEGA SAMMY CREATION (the “Merger”). SEGA SAMMY CREATION and Merger Sub are affiliates of SEGA SAMMY HOLDINGS, INC. Pursuant to the Merger Agreement, and upon the terms and subject to the conditions thereof, at the effective time of the Merger, and as a result of the Merger (and without any action on the part of SEGA SAMMY CREATION, Merger Sub, the Company or any holder thereof): ● each of the Company’s ordinary shares issued immediately prior to the effective time of the Merger (other than shares held by SEGA SAMMY CREATION or Merger Sub, by the Company as a treasury share or by any person who properly asserts dissenters’ rights under Bermuda law) will be converted into the right to receive an amount in cash equal to $ 1.97 ● each of the Company’s outstanding restricted shares (whether vested or unvested) at the time of the Merger will become vested in full and non-forfeitable and will be converted into the right to receive the Merger Consideration; ● each of the Company’s outstanding restricted share units (whether vested or unvested) at the effective time of the Merger will become vested in full and will be automatically cancelled in exchange for the right to receive a single lump sum cash payment, without interest and subject to any applicable tax withholding, equal to the product of (a) the Merger Consideration and (b) the number of Company ordinary shares subject to such restricted share unit; and ● each of the Company’s outstanding options to acquire the Company ordinary shares (whether vested or unvested) at the effective time of the Merger will become vested in full and will be automatically cancelled in exchange for the right to receive a single lump sum cash payment, without interest and subject to any applicable tax withholding, equal to the product of (a) the excess, if any, of the Merger Consideration over the exercise price per share of the option and (b) the number of Company ordinary shares issuable upon the exercise in full of such option. Consummation of the Merger is not subject to a financing condition, but is subject to customary closing conditions, including (a) approval by the Company’s shareholders of the Merger Agreement, the Merger and the Statutory Merger Agreement, (b) receipt of applicable antitrust and CFIUS approvals or the expiration of applicable waiting periods, (c) absence of any order or injunction prohibiting the consummation of the Merger and (d) the accuracy of the Company’s representations and warranties contained in the Merger Agreement (subject to certain customary qualifications) and compliance by the Company with its agreements and covenants contained in the Merger Agreement. The closing of the Merger is also predicated upon receipt of approval of the Merger and change in control of the Company by all relevant gaming authorities. The Company anticipates that this will take some time, and that the closing of the Merger may not occur until late 2024 or early 2025. On February 13, 2024, the Company held a special general meeting of the shareholders of the Company to consider and vote upon the Merger Agreement, at which meeting the shareholders approved the Merger Agreement. Also, the waiting period under applicable antitrust laws expired on June 6, 2024, and on June 27, 2024, the Company received clearance under CFIUS. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the results of the Parent and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect all adjustments, in the opinion of management, of a normal recurring nature that are necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. The financial data and other financial information disclosed in these notes to the condensed consolidated financial statements related to these periods are also unaudited. The results of operations for the three and six months ended June 30, 2024, are not necessarily indicative of the results that may be expected for the year ended December 31, 2023, or for any future annual or interim period. The condensed consolidated balance sheet as of December 31, 2023, included herein was derived from the audited consolidated financial statements as of that date. The accompanying unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Liquidity The accompanying condensed consolidated financial statements have been prepared on a going concern basis. As of June 30, 2024, the Company had an accumulated deficit of $ 315.2 36.9 10.2 1.7 5.9 0.9 30.0 27.6 Additionally, the Company’s current financial condition, liquidity resources, and planned near-term cash flows from operations are sensitive to changes in macro-economic conditions, and the substantial variability inherent in the Company’s wager-based revenues streams. These factors, when considered together with potential covenant breaches under the Company’s Credit Facility indicate uncertainty related to the ability of the company to meet its current obligations as they come due. On April 13, 2023, a subsidiary of the Company executed agreements to amend the Credit Facility and increase the principal balance from $ 30.0 42.0 10.0 To the extent that the Company’s current resources, including its ability to generate operating cash flows, are insufficient to satisfy its cash requirements, the Company may seek additional equity or debt financing. The Company’s ability to do so depends on prevailing economic conditions and other factors, many of which are beyond management’s control. The Company does not currently have any such credit facilities or similar debt arrangements in place, outside of the Amended Credit Facility described above, and cannot provide any assurance as to the availability or terms of any additional future financing that it may require to support its operations. If the needed financing is not available, or if the terms of financing are less desirable than expected, the Company may be forced to decrease its level of investment in new products and technologies, discontinue further expansion of the business, or scale back its existing operations, any of which could have an adverse impact on the Company and its financial prospects. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Due to the inherent uncertainties involved in making estimates, actual results could differ from the original estimates, and may require significant adjustments to these reported balances in future periods. Foreign Currency Translation and Transactions The Company’s reporting currency is the U.S. Dollar while the Company’s foreign subsidiaries use their local currencies as their functional currencies. The assets and liabilities of foreign subsidiaries are translated to U.S. Dollars based on the current exchange rate prevailing at each reporting period. Revenue and expenses are translated into U.S. Dollars using the average exchange rates prevailing for each period presented. Translation adjustments that arise from translating a foreign subsidiary’s financial statements from their functional currency to U.S. Dollars are reported as a separate component of accumulated other comprehensive loss in shareholders’ equity (deficit). Gains and losses arising from transactions denominated in a currency other than the functional currency are included in general and administrative expense in the condensed consolidated statements of operations as incurred. Foreign currency transaction and remeasurement gains and losses were a net loss of $ 780 392 1,057 1,016 Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of its cash and trade receivables. The Company holds cash deposits in foreign countries, primarily in Northern Europe and Latin America, of approximately $ 28.8 1.9 The Company maintains an allowance for potential credit losses, but historically has not experienced any significant losses related to individual customers or groups of customers in any particular geographic area. Risks and Uncertainties Macroeconomic conditions can materially adversely affect the Company’s business, results of operations and financial condition. Recent adverse macroeconomic conditions, including inflation, higher interest rates, slower growth or recession, the strengthening of the U.S. dollar, and corresponding currency fluctuations can have an adverse material impact on the Company’s future results of operations, cash flows, and financial condition, particularly with respect to foreign currency adjustments relating to our international operations. Such conditions may also affect consumers’ willingness to make discretionary purchases, and therefore the Company, along with its casino operator customers, may experience a decline in wagering. A downturn in the economic environment can also lead to increased credit and collectability risk on the Company’s trade receivables, limitations on the Company’s ability to issue new debt, and reduced liquidity. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Revenue Recognition Revenue from B2B Operations The Company’s revenue from its B2B operations are primarily from its internet gaming Software-as-a-Service (“SaaS”) platform, GameSTACK, that its customers use to provide RMiG, online sports gaming and SIM services to its end users. The Company enters into contracts with its customers that generally range from three to five years and include renewal provisions. These contracts generally include provision of the internet gaming platform, content consisting of proprietary and third-party games, development services and support and marketing services. In certain cases, the contract may include computer hardware to be procured on behalf of the customer. The customers cannot take possession of the hosted GameSTACK software, and the Company does not sell or license the GameSTACK software. The Company charges fees as consideration for use of its internet gaming system, game content, support and marketing services based on a fixed percentage of the casino operator’s net gaming revenue or net sportsbook win, at the time of settlement of an event for RMiG contracts, considered usage-based fees, or at the time of purchase for in-game virtual credit for SIM contracts. The determination of the fee charged to its customers is negotiated and varies significantly. Certain of these RMiG contracts provide the Company with a minimum monthly revenue guarantee in relation to the Company’s share of the casino operator’s net gaming revenue or net sportsbook win. At June 30, 2024 the remaining unsatisfied performance obligations related to fixed minimum guaranteed revenue totaled $ 45.4 the Company expects to satisfy $33.0 million within the next five year period, and the remaining over a ten year period. The Company’s promise to provide the RMiG SaaS platform and content licensing services on the hosted software is a single performance obligation. This performance obligation is recognized over time, as the Company provides services to its customers in its delivery of services to the player end user. The Company’s customers simultaneously receive and consume the benefits provided by the Company as it delivers services to its customers. Usage based fees are considered variable consideration as the service is to provide unlimited continuous access to its hosted application and usage of the hosted system is primarily controlled by the player end user. The transaction price includes fixed and variable consideration and is billed monthly with the amount due generally thirty days from the date of the invoice. Variable consideration is allocated entirely to the period in which consideration is earned as the variable amounts relate specifically to the customer’s usage of the platform that day and allocating the usage-based fees to each day is consistent with the allocation objective, primarily that the change in amounts reflect the changing value to the customer. The Company’s internet gaming system, game content, support and marketing services are provided equally throughout the term of the contract. These services are made up of a daily requirement to provide access and use of the internet gaming system and optional support and marketing services to the customer over the same period of time. The series of distinct services represents a single performance obligation that is satisfied over time. Purchases of virtual credits within a transaction period on the SIM platform, generally a monthly convention, are earned over time, and are typically billed monthly upon the close of the respective period as the credit has no monetary value, cannot be redeemed, exchanged, transferred or withdrawn, represents solely a device for tracking game play during the month, does not obligate the Company to provide future services and the arrangements with the customer and player end user have no substantive termination penalty. In certain service agreements with its SIM customers, the fees collected by the Company from third-party payment processors for the purchases of in-game virtual credits made by end-users include the SIM customer’s portion. The Company records the SIM customer’s portion as a liability as cash is collected and remits payment to the SIM customer for their share of the SIM revenues monthly. At June 30, 2024 and December 31, 2023, the Company recorded a liability due to its customers for their share of the fees of $ 1,889 1,994 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) The Company uses third-party content providers in supplying game content in its performance of providing game content on its platform to its customers. A customer has access to the Company’s propriety and licensed game content and additionally, the customer can direct the Company to procure third-party game content on its behalf. The Company has determined it acts as the principal for providing the game content when the Company controls the game content, and therefore presents the revenue on a gross basis in the condensed consolidated statements of operations. When the customer directs the Company to procure third-party game content, the Company determined it is deemed an agent for providing such game content, and therefore, records the revenue, net of the costs of content license fees, in the condensed consolidated statements of operations. The Company also provides ongoing development services involving updates to the RMiG platforms for enhanced functionality or customization. Ongoing development services are typically billed monthly, at a daily rate, for services performed. Revenue from RMiG platform development services that are identified as distinct performance obligations and enhance or create an asset the customer controls as the Company performs the services are recognized over time as services are performed. This revenue is measured using an input method based on effort expended, which uses direct labor hours incurred. These services have primarily related to post-launch development of third-party application integration software in the customer’s environment. Separately, the revenue generated from customers for development services that are distinct performance obligations and the customer benefits from the integrated SaaS offering are deferred over the license service term. These services have primarily related to enhancements to the Company’s platforms that do not enhance or create an asset the customer controls. In customer contracts that require a portion of the consideration to be received in advance or at the commencement of the contract, such amounts are recorded as a contract liability. Other services include the resale of third-party computer hardware, such as servers and other related hardware devices, upon which the GameSTACK software is installed for its customers. These products are not required to be purchased to access the GameSTACK platform but are sold as a convenience to the customer. The Company procures the computer hardware on the customer’s behalf for a fee determined based on the cost of the computer hardware plus a markup. The Company charges a hardware deployment fee which is a one-time fee for installation, testing and certification of the computer hardware at the gaming hosting facility. Revenue is recognized at the point in time when control of the hardware transfers to the customer. Control is transferred after the hardware has been procured, delivered, installed at the customer’s premises and configured to allow for remote access. The Company has determined that it is acting as the principal in providing computer hardware and related services as it assumes responsibility for procuring, delivering, installing and configuring the hardware at the customer’s location and takes control of the hardware, prior to transfer. Revenue is presented at the gross amount of consideration to which it is entitled from the customer in exchange for the computer hardware and related services. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Contracts with Multiple Performance Obligations For customer contracts that have more than one performance obligation, the transaction price is allocated to the performance obligations in an amount that depicts the relative stand-alone selling prices of each performance obligation. Judgment is required in determining the stand-alone selling price for each performance obligation. In determining the allocation of the transaction price, an entity is required to maximize the use of observable inputs. When the stand-alone selling price of a good or service is not directly observable, an entity is required to estimate the stand-alone selling price. Contracts with its customers may include platform and licensing of game content services, as well as development services and computer hardware services. The variable consideration generated from the platform and the licensing of game content is allocated entirely to the performance obligations for platform and licensing of game content services and the remaining fixed fees for development services and computer hardware would be allocated to each of the remaining performance obligation based on their relative stand-alone selling prices. The variable consideration relates entirely to the effort to satisfy the platform and licensing game content services and the fixed consideration relates to the remaining performance obligations which is consistent with the allocation objective. Revenue from B2C Gaming Operations The Company operates the B2C gaming site www.coolbet.com outside of the U.S., which contains proprietary software and includes the following product offerings: sportsbook, poker, casino, live casino and virtual sports. The Company manages an online sportsbook allowing users to place various types of wagers on the outcome of sporting events conducted around the world. The Company operates as the bookmaker and offers fixed odds wagering on such events. When a user’s wager wins, the Company pays the user a pre-determined amount known as fixed odds. Revenue from online sportsbook is reported net after deduction of player winnings and bonuses. Revenue from wagers is recognized when the outcome of the event is known. The Company offers live casino through its digital online casino offering in select markets, allowing users to place a wager and play games virtually at retail casinos. The Company offers users a catalog of over 7,600 Peer-to-peer poker offerings allow users to play poker against one another on the Company’s online poker platform for prize money. Revenue is recognized as a percentage of the reported rake. Additionally, the Company offers tournament poker which allows users to buy-in for a fixed price for prize money. For tournament play, revenue is recognized for the difference between the entry fees collected and the amounts paid out to users as prizes and winnings. In each of the online gaming products, a single performance obligation exists at the time a wager is made to operate the games and award prizes or payouts to users based on a particular outcome. Revenue is recognized at the conclusion of each contest, wager, or wagering game hand. Additionally, certain incentives given to users, for example, that allow the user to make an additional wager at a reduced price, may provide the user with a material right which gives rise to a separate performance obligation. The Company allocates a portion of the user’s wager to incentives that create material rights that are redeemed or expired in the future. The allocated revenue for gaming wagers is primarily recognized when the wagers occur because all such wagers settle immediately. The Company applies a practical expedient by accounting for revenue from gaming on a portfolio basis because such wagers have similar characteristics, and the Company reasonably expects the effects on the financial statements of applying the revenue recognition guidance to the portfolio to not differ materially from that which would result if applying the guidance to an individual wagering contract. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Cost of Revenue Cost of revenue consists primarily of variable costs. These include mainly (i) content license fees, (ii) payment processing fees and chargebacks, (iii) platform technology, software, and connectivity costs directly associated with revenue generating activities, (iv) gaming duties, and (v) sportsbook feed / provider services. The Company incurs payment processing fees on B2C user deposits, withdrawals, and deposit reversals from payment processors. Cost of revenue excludes depreciation of the servers on which the Company’s gaming platforms reside as well as amortization of intangible assets including internally developed software. Sales and Marketing Sales and marketing expenses consist primarily of general marketing and advertising costs, B2C user acquisition expenses and personnel costs within our sales and marketing functions. Sales and marketing costs are expensed as incurred. Product and Technology Product and technology expenses consist primarily of personnel costs associated with development and maintenance activities that are not capitalized. These costs primarily represent employee expenses (including but not limited to, salaries, bonus, employee benefits, employer tax expenses, and share-based compensation) for personnel and contractors involved in the design, development, and project management of our proprietary technologies as well as developed and licensed content. General and Administrative General and administrative expenses consist of costs, including gaming operations costs, not related to sales and marketing, product and technology or revenue. General and administrative costs include professional services (including legal, regulatory and compliance, audit, and consulting expenses), rent contingencies, insurance, allowance for credit losses, foreign currency transaction gains and losses, and costs related to the compensation of executive and non-executive personnel, including share-based compensation. Content Licensing Fees Content licensing fees are paid to third parties for gaming content which are expensed as incurred. Content licensing fees are calculated as a percentage of net gaming revenues in respect of the third-party games, as stipulated in the third-party agreements. Share-based Compensation Share-based compensation expense is recognized for share options and restricted shares issued to employees and non-employee members of the Company’s Board of Directors. The Company’s issued share options and restricted shares, which are primarily considered equity awards and include only service conditions, are valued based on the fair value of these awards on the date of grant. The fair value of the share options is estimated using a Black-Scholes option pricing model and the fair value of the restricted shares (restricted share awards and restricted share units) is based on the market price of the Company’s shares on the date of grant. Certain restricted share unit awards issued to non-employee members of the Company’s Board of Directors permit shares upon vesting to be withheld, as a means of meeting the non-employee director’s tax withholding requirements and paid in cash to the non-employee director. The Company additionally incurs share-based compensation expense under compensation arrangements with certain of its employees under which the Company will settle bonuses for a fixed dollar amount by issuing a variable number of shares based on the Company’s share price on the settlement date. These awards are classified as liability-based awards which are measured based on the fair value of the award at the end of each reporting period until settled. Related compensation expense is recognized based on changes to the fair value over the applicable service period. Share-based compensation is recorded over the requisite service period, generally defined as the vesting period. For awards with graded vesting and only service conditions, compensation cost is recorded on a straight-line basis over the requisite service period of the entire award. Forfeitures are recorded in the period in which they occur. Earnings Per Share, Basic and Diluted Basic earnings per share is calculated by dividing earnings by the weighted average number of ordinary shares outstanding during the year. In periods of loss, basic and diluted per share information are the same. Cash Cash is comprised of cash held at banks and third-party service providers (“ 4.0 3.6 The Company is required to maintain compensating cash balances to satisfy its liabilities to users. Such balances are included within cash in the condensed consolidated balance sheets and are not subject to creditor claims. At June 30, 2024 and December 31, 2023, the related liabilities to users were $ 10,201 10,185 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Capitalized Software Development Costs, net The Company capitalizes certain development costs related to its internet gaming platforms during the application development stage. Costs associated with preliminary project activities, training, maintenance and all other post implementation stage activities are expensed as incurred. Software development costs are capitalized when application development begins, it is probable that the project will be completed, and the software will be used as intended. The Company capitalizes certain costs related to specific upgrades and enhancements when it is probable that expenditures will result in additional functionality of the platform to its customers. The capitalization policy provides for the capitalization of certain payroll and payroll related costs for employees who spent time directly associated with development and enhancements of the platform. Capitalized software development costs are amortized on a straight-line basis over their estimated useful lives, which generally ranges from three five years GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Long-lived Assets Long-lived assets, except goodwill, consist of property and equipment, and finite lived acquired intangible assets, such as developed software, gaming licenses, trademarks, trade names and customer relationships. Intangible assets are amortized on a straight-line basis over their estimated useful lives. The Company considers the period of expected cash flows and underlying data used to measure the fair value of the intangible assets when selecting the estimated useful lives. Gaming licenses include license applications fees and market access payments in connection with agreements that the Company enters with strategic partners. The market access arrangements authorize the Company to offer online gaming and online sports betting in certain regulated markets. These costs are capitalized and amortized on a straight-line basis over their estimated useful lives, beginning with the commencement of operations. The fair value of acquired intangible assets are primarily determined using the income approach. In performing these valuations, the Company’s key underlying assumptions used in the discounted cash flows were projected revenue, gross margin expectations and operating cost estimates. There are inherent uncertainties and management judgment is required in these valuations. Long-lived assets, except goodwill, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company compares the undiscounted cash flows expected to be generated by that asset or asset group to their carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment charge is recognized to the extent that the carrying amount exceeds fair value. Fair value is determined through various techniques, such as discounted cash flow models using probability weighted estimated future cash flows and the use of valuation specialists. During the three and six months ended June 30, 2024, there was no triggering event that would cause the Company to believe the value of its long-lived assets should be impaired. Liabilities to Users The Company records liabilities for user account balances. User account balances consist of user deposits, promotional awards and user winnings less user withdrawals and user losses. Legal Contingencies and Litigation Accruals On a quarterly basis, the Company assesses potential losses in relation to pending or threatened legal matters. If a loss is considered probable and the amount can be reasonably estimated, the Company recognizes an expense for the estimated loss. Estimates of any such loss are subjective in nature and require the evaluation of numerous facts and assumptions as to future events, including the application of legal precedent which may be conflicting. To the extent these estimates are more or less than the actual liability resulting from the resolution of these matters, the Company’s financial results will increase or decrease accordingly. Legal costs associated with loss contingencies are expensed as incurred. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Debt Debt issuance costs incurred in connection with the issuance of new debt are recorded as a reduction to the long-term debt balance on the condensed consolidated balance sheets and amortized over the term of the loan commitment as interest expense in the accompanying condensed consolidated statements of operations. The Company calculates amortization expense on capitalized debt issuance costs using the effective interest method in accordance with Accounting Standards Codification (“ASC”) 470, Debt. Leases The Company determines if an arrangement is a lease and classifies as operating or finance lease at the lease commencement date. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of an asset for a time period in exchange for consideration. In accordance with ASC 842, Leases, the Company recognizes for all leases, except short-term leases, at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The Company accounts for the lease and non-lease components of its leases as a single lease component. Operating leases are included in operating lease ROU assets and operating lease liabilities, current and noncurrent, on the condensed consolidated balance sheets. Lease expense is recognized on a straight-line basis based on the total contractually required lease payments, over the term of the lease. Fair Value of Financial Instruments The Company applies the provisions of ASC 820, Fair Value Measurements and Disclosures, which provides a single authoritative definition of fair value, sets out a framework for measuring fair value and expands on required disclosures about fair value measurement. Fair value represents the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company uses the following hierarchy in measuring the fair value of the Company’s assets and liabilities, focusing on the most observable inputs when available: ● Level 1 Quoted prices in active markets for identical assets or liabilities. ● Level 2 Observable inputs other than Level 1 quoted prices, such as quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active for identical or similar assets and liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 Valuations are based on the inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Valuation techniques used to measure the fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The Company does not hold any significant Level 2 financial instruments. Level 3 financial instruments held by the Company include synthetic equity liability due to a customer. See Note 15 — Commitments and Contingencies for further detail. The instrument includes Level 3 inputs related to the contractual forecasts, in addition to observable inputs such as the stock volatility of the company, which are utilized in the Company’s Monte Carlo valuation. The valuation is not sensitive to significant movements in the forecast. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per sh |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 6 Months Ended |
Jun. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 3 PROPERTY AND EQUIPMENT, NET Property and equipment, net is recorded in other assets in the condensed consolidated balance sheets at June 30, 2024 and December 31, 2023 and consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT Life (in years) 2024 2023 Estimated Useful June 30, December 31, Life (in years) 2024 2023 Fixtures, fittings and equipment 3 5 $ 4,424 $ 5,052 Platform hardware 5 1,975 2,251 Total property and equipment, cost 6,399 7,303 Less: accumulated depreciation (2,909 ) (3,144 ) Total $ 3,490 $ 4,159 Depreciation expense related to property and equipment was $ 385 371 801 736 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
CAPITALIZED SOFTWARE DEVELOPMEN
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET | 6 Months Ended |
Jun. 30, 2024 | |
Research and Development [Abstract] | |
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET | NOTE 4 CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET Capitalized software development costs, net at June 30, 2024 and December 31, 2023 consisted of the following: SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET June 30, December 31, 2024 2023 Capitalized software development costs $ 11,689 $ 10,759 Development in progress 126 494 Total capitalized software development, cost 11,815 11,253 Less: accumulated amortization (4,111 ) (2,883 ) Total $ 7,704 $ 8,370 At June 30, 2024, development in progress primarily represents costs associated with GAN Sports, costs associated with its newer GameSTACK technology, and enhancements to the Company’s proprietary B2C software platform. Amortization expense related to capitalized software development costs was $ 697 490 1,340 976 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 5 INTANGIBLE ASSETS Intangible Assets Definite-lived intangible assets, net consisted of the following: SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS Average Gross Net Weighted June 30, 2024 Average Gross Net Amortization Carrying Accumulated Carrying Period (in years) Amount Amortization Amount Developed technology 5.0 $ 33,553 $ (28,556 ) $ 4,997 Customer relationships 3.3 6,805 (5,917 ) 888 Trade names and trademarks 10.0 5,378 (2,143 ) 3,235 Gaming licenses 5.3 3,798 (2,265 ) 1,533 $ 49,534 $ (38,881 ) $ 10,653 Average Gross Net Weighted December 31, 2023 Average Gross Net Amortization Carrying Accumulated Carrying Period (in years) Amount Amortization Amount Developed technology 5.0 $ 34,669 $ (28,711 ) $ 5,958 Customer relationships 3.3 6,977 (5,835 ) 1,142 Trade names and trademarks 10.0 5,549 (1,889 ) 3,660 Gaming licenses 5.4 3,617 (2,019 ) 1,598 $ 50,812 $ (38,454 ) $ 12,358 Amortization expense related to intangible assets was $ 834 3,383 1,614 6,732 Estimated amortization expense for the next five years is as follows: SCHEDULE OF FINITE -LIVED INTANGIBLE ASSETS, AMORTIZATION EXPENSE Amount Remainder of 2024 $ 1,685 2025 3,182 2026 2,725 2027 2,139 2028 908 Thereafter 14 Total $ 10,653 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 6 DEBT Credit Facility On April 26, 2022, a subsidiary of the Company entered into the Credit Facility which provides for $ 30.0 1 9.5 October 26, 2026 The Company incurred $ 2.4 27.6 7.3 8.8 Subsequent Amendments On April 13, 2023, a subsidiary of the Company executed agreements to amend the Credit Facility to waive all events of default, amend certain financial covenants, assign the rights to the Credit Facility from its existing lender to a third party, and increase the principal balance from $ 30.0 42.0 8.0 The Amended Credit Facility matures on the third anniversary of its effective date and is fully guaranteed by the Company. There are no scheduled principal payments due under the Amended Credit Facility until maturity. The principal balance, accrued PIK interest, and an exit fee of 2.5 3.1 10.0 Debt Covenants The Credit Facility contained affirmative and negative covenants, including certain financial covenants associated with the Company’s financial results. The negative covenants included restrictions regarding the incurrence of liens and indebtedness, certain merger and acquisition transactions, asset sales and other dispositions, other investments, dividends, share purchases and payments affecting subsidiaries, changes in nature of business, fiscal year or organizational documents, transactions with affiliates, and other matters. The Credit Facility contained customary events of default, including, among others: non-payments of principal and interest; breach of representations and warranties; covenant defaults; the existence of bankruptcy or insolvency proceedings; certain events under ERISA; gaming license revocations in material jurisdictions; material judgments; and a change of control. If an event of default occurred and was not cured within any applicable grace period or was not waived, the administrative agent and the lender were entitled to take various actions, including, without limitation, the acceleration of all amounts due and the termination of commitments under the Credit Facility. The carrying values of the Company’s long-term debt consist of the following: SCHEDULE OF LONG TERM DEBT Effective Interest Rate As of June 30, 2024 Credit Facility Principal 10.22 % $ 46,453 Less unamortized debt issuance costs (1,955 ) Long-term debt, net $ 44,498 The Company incurred $ 1,166 913 252 200 2,310 2,307 499 526 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | NOTE 7 SHARE-BASED COMPENSATION In April 2020, the Board of Directors established the GAN Limited 2020 Equity Incentive Plan (“2020 Plan”) which has been approved by the Company’s shareholders. The 2020 Plan initially provides for grants of up to 4,400,000 4 st 11,075,190 3,356,755 Share Options A summary of the share option activity as of and for the six months ended June 30, 2024 is as follows: SCHEDULE OF SHARE-BASED COMPENSATION, STOCK OPTION ACTIVITY Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Shares Price Term Value Outstanding at December 31, 2023 2,680,190 $ 5.69 6.43 $ 1,877 Granted 50,000 0.01 Exercised (8,012 ) 0.01 Forfeited/expired or cancelled (274,841 ) 5.15 Outstanding at June 30, 2024 2,447,337 $ 5.66 6.13 $ 1,899 Options exercisable at June 30, 2024 1,786,821 $ 6.92 5.29 $ 986 The Company recorded share-based compensation expense related to share options of $ 403 879 819 1,535 38 58 2,077 2.3 Share option awards generally vest 25 after one year and then monthly over the next 36 months thereafter and have a maximum term of ten years 50,000 0.01 1.55 0.00 1.55 1.70 For options granted during the six months ended June 30, 2024, the fair value of each share option award is estimated on the date of grant using the Black-Scholes option pricing model that uses the assumptions noted above. Estimating the grant date fair values for employee share options requires management to make assumptions regarding expected volatility of the value of those underlying shares, the risk-free rate of the expected life of the share options and the date on which share-based compensation is expected to be settled. Expected volatility is determined by reference to volatility of certain identified peer group share trading information and share prices on the Nasdaq stock exchange. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The expected term of the options is based on historical data and represents the period of time that options granted are expected to be outstanding. For the three and six months ended June 30, 2024 and 2023, volatility, term, and risk-free interest rate were not meaningful inputs as all outstanding options were $ 0.01 Restricted Share Units Restricted share units are issued to non-employee directors and employees. For equity-classified restricted share units, the fair value of restricted share units is valued based on fair market value of the Company’s ordinary shares on the date of grant and is amortized on a straight-line basis over the vesting period. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) During the first and second quarter of 2024, there were no issuances of restricted share units to its non-employee directors or employees. The Company withholds a portion of the restricted share units granted to its officers and non-employee directors upon vesting in order to remit a cash payment to the officers and directors equal to their tax expense. The liabilities are recorded in accrued compensation and benefits in the condensed consolidated balance sheets. During the three months ended June 30, 2024, 3,890 912 The Company recorded share-based compensation expense related to restricted share units of $ 386 749 822 1,396 3,407 2.61 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) A summary of the restricted share unit activity as of and for the six months ended June 30, 2024 is as follows: SCHEDULE OF SHARE BASED COMPENSATION, RESTRICTED STOCK UNIT ACTIVITY Weighted Average Number of Grant Date Shares Fair Value Outstanding at December 31, 2023 2,212,244 $ 2.49 Granted — — Vested (484,614 ) 2.68 Forfeited/expired or cancelled (46,918 ) 3.11 Outstanding at June 30, 2024 1,680,712 $ 2.42 Restricted Share Awards Restricted share awards are issued to non-employee directors and certain key employees. The value of a restricted stock award is based on the market value of the Company’s ordinary shares at the date of the grant. The Company recorded share-based compensation expense related to the restricted share awards of $ 41 83 2020 Employee Stock Purchase Plan The Board of Directors established the 2020 Employee Stock Purchase Plan, or the ESPP, which was approved by the Company’s shareholders in July 2021. The ESPP is intended to qualify under Section 423 of the U.S. Internal Revenue Service Code of 1986, as amended. The ESPP provides initially for 300,000 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) The ESPP is designed to allow eligible employees to purchase ordinary shares, at quarterly intervals, with their accumulated payroll deductions. The participants are offered the option to purchase ordinary shares at a discount during a series of successive offering periods. The option purchase price may be the lower of 85 57,960 18 Content Provider Issuance On March 29, 2023, the Company amended and restated its commercial agreement with a content provider. In conjunction with this agreement, the Company entered into a Subscription Agreement with the content provider, under which the content provider has subscribed to 1,250,000 |
DEFINED CONTRIBUTION PLANS
DEFINED CONTRIBUTION PLANS | 6 Months Ended |
Jun. 30, 2024 | |
Retirement Benefits [Abstract] | |
DEFINED CONTRIBUTION PLANS | NOTE 8 DEFINED CONTRIBUTION PLANS U.S. employees and non-U.S. employees are eligible to participate in defined contribution plans by contributing a portion of their compensation, which provides for certain matching contributions by the Company. Matching contributions for the U.S. defined contribution plan are 50 4 160 177 343 355 |
Other Loss (Income), Net
Other Loss (Income), Net | 6 Months Ended |
Jun. 30, 2024 | |
Other Loss Income Net | |
Other Loss (Income), Net | NOTE 9 — Other Loss (Income), Net Other loss (income), net consisted of the following: SCHEDULE OF OTHER LOSS (INCOME),NET 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Other income (1) $ — $ (427 ) $ (26 ) $ (9,718 ) Other loss (2) 27 8,784 27 8,784 Total other loss (income), net $ 27 $ 8,358 $ 1 $ (934 ) (1) Includes gain on extinguishment of $ 0.4 9.7 15.0 (2) Includes loss on debt extinguishment of $ 8.8 |
LOSS PER SHARE
LOSS PER SHARE | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
LOSS PER SHARE | NOTE 10 LOSS PER SHARE Loss per ordinary share, basic and diluted, is computed by dividing net loss by the weighted average number of ordinary shares outstanding during the period. Potentially dilutive securities consisting of certain share options, nonvested restricted shares and restricted share units were excluded from the computation of diluted weighted average ordinary shares outstanding as inclusion would be anti-dilutive, are summarized as follows: SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Share options 2,447,337 3,488,663 2,447,337 3,488,663 Restricted shares — 17,218 — 17,218 Restricted share units 1,680,712 1,862,370 1,680,712 1,862,370 Total 4,128,049 5,368,251 4,128,049 5,368,251 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
REVENUE
REVENUE | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | NOTE 11 REVENUE The following table reflects revenue recognized for the three and six months ended June 30, 2024 and 2023 in line with the timing of transfer of services: SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Revenue from services delivered at a point in time $ 22,570 $ 23,863 $ 40,875 $ 47,763 Revenue from services delivered over time 12,990 9,895 25,336 21,124 Total $ 35,560 $ 33,758 $ 66,211 $ 68,887 Contract and Contract-Related Liabilities The Company has four types of liabilities related to contracts with customers: (i) cash consideration received in advance from customers related to development services not yet performed or hardware deliveries not yet completed, (ii) incentive program obligations, which represents the deferred allocation of revenue relating to incentives in the online gaming operations, (iii) user balances, which are funds deposited by customers before gaming play occurs and (iv) unpaid winnings and wagers contributed to jackpots. Contract-related liabilities are expected to be recognized as revenue within one year of being purchased, earned or deposited. Such liabilities are recorded in liabilities to users and other current liabilities in the condensed consolidated balance sheets. In August 2023, WSI US, LLC (“WynnBet”) notified the Company of its intent to modify its multi-state revenue contract with the Company and, in November 2023, the Company completed its negotiations with WynnBet (the “WynnBet modification”). The results of renegotiations were primarily to amend performance obligations such that (i) obligations in certain states that had not launched at the modification date were formally terminated, (ii) obligations in certain states that launched prior to the modification date had the term reduced, and (iii) obligations in certain states such as Nevada, Massachusetts and New York would continue under more favorable commercial terms. The total consideration allocated to these modifications was $ 5.0 The Company determined that the remaining performance obligations related to each state that either already launched or would launch under the modified agreement and allocated the $ 5.0 WynnBet further agreed to terms for the state of Michigan governed by as separate revenue arrangement that provided WynnBet with an optional performance obligations for either migrations services or termination rights, at their choosing, of $ 5.0 1.4 Additional consideration was provided related to the Company’s right of first refusal to obtain WynnBet’s operation in the state of Michigan amounting to $ 1.8 0.3 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) The following table reflects contract liabilities arising from cash consideration received in advance from customers for the periods presented: SCHEDULE OF CONTRACT WITH CUSTOMERS 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Contract liabilities from advance customer payments, beginning of the period $ 9,000 $ 2,655 7,873 $ 2,117 Contract liabilities from advance customer payments, end of the period (1) 8,946 2,607 8,946 2,607 Revenue recognized from amounts included in contract liabilities from advance customer payments at the beginning of the period 1,103 263 1,287 457 (1) Contract liabilities from advance customer payments, end of period consisted of $ 5,279 1,760 3,667 847 |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | NOTE 12 SEGMENT REPORTING The Company’s reportable segments are B2B and B2C. The B2B segment develops, markets and sells instances of GameSTACK, GAN Sports, and iSight Back Office technology that incorporates comprehensive player registration, account funding and back-office accounting and management tools that enable the casino operators to efficiently, confidently and effectively extend their presence online in places that have permitted online real money gaming. The B2C segment, which includes the operations of Coolbet, develops and operates a B2C online sports betting and casino platform that is accessible through its website in markets across Northern Europe, Latin America and Canada. Information reported to the Company’s Chief Executive Officer, the CODM, for the purpose of resource allocation and assessment of the Company’s segmental performance is primarily focused on the origination of the revenue streams. The CODM evaluates performance and allocates resources based on the segment’s revenue and contribution. Segment contribution represents the amounts earned by each segment without allocation of each segment’s share of depreciation and amortization expense, sales and marketing expense, product and technology expense, general and administrative expense, interest costs and income taxes. Summarized financial information by reportable segments for the three months ended June 30, 2024 and 2023 is as follows: SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS B2B B2C Total B2B B2C Total Three Months Ended June 30, 2024 2023 B2B B2C Total B2B B2C Total Revenue $ 12,990 $ 22,570 $ 35,560 $ 9,895 $ 23,863 $ 33,758 Cost of revenue (1) 2,211 8,033 10,244 2,078 7,407 9,485 Segment contribution $ 10,779 $ 14,537 $ 25,316 $ 7,817 $ 16,456 $ 24,273 (1) Excludes depreciation and amortization expense. During the three months ended June 30, 2024 and 2023, one customer in the B2B segment individually accounted for 15.0 13.5 Summarized financial information by reportable segments for the six months ended June 30, 2024 and 2023 is as follows: B2B B2C Total B2B B2C Total Six Months Ended June 30, 2024 2023 B2B B2C Total B2B B2C Total Revenue $ 25,336 $ 40,875 $ 66,211 $ 21,174 $ 47,713 $ 68,887 Cost of revenue (1) 4,292 15,275 19,567 4,073 15,573 19,646 Segment contribution $ 21,044 $ 25,600 $ 46,644 $ 17,101 $ 32,140 $ 49,241 (1) Excludes depreciation and amortization expense. During the six months ended June 30, 2024 and 2023, one customer in the B2B segment individually accounted for 17.3 14.8 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) The following table presents a reconciliation of segment gross profit to the consolidated loss before income taxes for the three and six months ended June 30, 2024 and 2023: SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT CONTRIBUTION TO CONSOLIDATED LOSS BEFORE INCOME TAXES 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Segment contribution (1) $ 25,316 $ 24,273 $ 46,644 $ 49,241 Sales and marketing 7,056 7,324 13,073 14,508 Product and technology 8,137 11,238 17,753 20,816 General and administrative (1) 7,980 10,029 15,139 20,035 Depreciation and amortization 1,914 4,243 3,753 8,444 Interest expense, net 1,157 905 2,289 2,621 Other loss (income), net 27 8,358 1 (934 ) Loss before income taxes $ (955 ) $ (17,824 ) $ (5,364 ) $ (16,249 ) (1) Excludes depreciation and amortization expense. Assets and liabilities are not separately analyzed or reported to the CODM and are not used to assist in decisions surrounding resource allocation and assessment of segment performance. As such, an analysis of segment assets and liabilities has not been included in this financial information. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) The following table disaggregates total revenue by product and services for each segment: SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 B2B: Platform and content license fees $ 8,703 $ 7,243 $ 18,369 $ 15,870 Development services and other 4,287 2,652 6,967 5,304 Total B2B revenue 12,990 9,895 25,336 21,174 B2C: Sportsbook 9,514 10,298 15,387 20,265 Casino 12,303 12,972 24,012 26,161 Poker 753 593 1,476 1,287 Total B2C revenue 22,570 23,863 40,875 47,713 Total revenue $ 35,560 $ 33,758 $ 66,211 $ 68,887 Revenue by location of the customer for the three and six months ended June 30, 2024 and 2023 is as follows: SCHEDULE OF REVENUE BY LOCATION OF THE CUSTOMER 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 United States $ 10,454 $ 7,296 $ 19,546 $ 15,812 Europe 14,120 12,107 25,728 24,784 Latin America 8,204 12,388 15,100 23,658 Rest of the world 2,782 1,967 5,837 4,633 Total revenue $ 35,560 $ 33,758 $ 66,211 $ 68,887 |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 13 INCOME TAXES The Company’s effective income tax rate was ( 81.3 3.3 9.8 4.1 Our country of domicile is Bermuda, which effectively has a 0 0 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2024 | |
Leases | |
LEASES | NOTE 14 LEASES The Company determines if an arrangement is a lease and classifies as operating or finance lease at the lease commencement date. A lease is defined as a contract, or part of contract, that conveys the right to control the use of an asset for a time period in exchange for consideration. At June 30, 2024, the Company’s lease portfolio consists of operating leases related to office facilities in Estonia and Bulgaria. The lease terms for both leases are five years. Options to extend or terminate a lease are included in the lease term when it is reasonably certain that the Company will exercise such options. In some jurisdictions it is customary for lease contracts to provide for payments to increase each year by inflation, or to be reset periodically to market rental rates or the periodic rent is fixed over the lease term. Lease payments for operating leases, consisting of fixed payments for base rent, is recognized on a straight-line basis over the lease term. The Company elected to record short-term lease costs on a straight-line basis over the term of the leases related to its shared work space facilities primarily in the United States and London, and incurred $ 85 161 181 547 Operating Leases - Lessee The following table discloses the operating asset and liability balances at June 30, 2024 and December 31, 2023: SCHEDULE OF OPERATING ASSET AND LIABILITY As of June 30, 2024 December 31, 2023 Leases Classification Assets Total operating leased assets, net Operating lease right-of-use assets (1) (1) $ 3,822 $ 4,340 Liabilities Current Operating lease liabilities $ 811 $ 804 Non-current Operating lease liabilities – non-current 3,041 3,577 Total lease liabilities $ 3,852 $ 4,381 (1) Operating lease right-of-use assets are recorded, net of accumulated amortization of $ 744 378 The Company uses its incremental borrowing rate at lease commencement to calculate the present value of lease payments when the rate implicit in a lease is not known. The incremental borrowing rate is based on the Company’s credit rating based on its market valuation metrics and corporate yield curves observed for public companies with similar credit ratings. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Operating lease costs were $ 283 151 568 257 Maturities of lease liabilities, including reconciliation to the lease liabilities, based on required contractual payments, are as follows: SCHEDULE OF FUTURE MINIMUM MATURITIES OF OPERATING LEASE LIABILITIES Operating Leases Remainder of 2024 $ 568 2025 1,137 2026 1,137 2027 1,137 2028 636 Total lease payments 4,615 Less: future interest costs 762 Present value of lease liabilities $ 3,852 Other information related to leases as of and for the six months ended June 30, 2024 and 2023 was as follows: SCHEDULE OF FINANCE AND OPERATING RELATED TO LEASES Six Months Ended June 30, 2024 2023 Operating lease weighted-average remaining lease term (years) 4.0 4.9 Operating lease weighted-average discount rate 9.0 % 8.9 % Cash paid for the amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 573 $ 215 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 15 COMMITMENTS AND CONTINGENCIES Legal Proceedings The Company may be subject to legal actions and claims arising from contracts or other matters from time to time in the ordinary course of business. Management is not aware of any pending or threatened litigation, which are considered other than routine legal proceedings. The Company believes the ultimate disposition or resolution of its routine legal proceedings will not have a material adverse effect on its financial position, results of operations or liquidity. Content Licensing Agreements In the second quarter of 2021, the Company entered into Content Licensing Agreements (the “Agreements”) with two third-party gaming content providers (“Content Providers”) specializing in developing and licensing interactive games. The Agreements granted the Company exclusive rights to use and distribute the online gaming content in North America. Each of the Content Providers were committed to developing a minimum number of games for the Company’s exclusive use over the five-year term, subject to extensions, of the respective Agreement. In exchange, the Company was required to pay fixed fees, totaling $ 48.5 8.5 On January 27, 2022, the Company served a termination notice, for cause, to a Content Provider as certain conditions precedent associated with the completion of contractual obligations had not been satisfied by the agreed upon period in 2021. In accordance with the agreement, termination for cause results in a return of the initial payment of $ 3.5 3.0 3.0 3.5 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) On March 29, 2023, the Company amended and restated its Content Licensing Agreement (the “Amended Agreement”) with the other Content Provider which resulted in a reduced contract term ending March 31, 2024 and a reduction in the fixed fees payable under the arrangement. The Company recorded a gain of $ 9.3 Chile Operations Coolbet’s B2C casino and sports-betting platform is accessible in Chile. Since June 1, 2020, foreign digital service suppliers that provide services to individuals in Chile have been required to register for value-added tax (“VAT”) purposes. On September 20, 2021, the Company submitted an inquiry to the Chilean Internal Revenue Service (“SII”) for clarification on the basis to apply VAT. In December 2021, the SII issued a general resolution as a response to another iGaming platform operator stating the Tax Administration’s position that fees paid by users for entertainment services provided through online gaming and betting platforms are subject to VAT in Chile. The SII clarified its interpretation that the VAT tax rate of 19 On May 13, 2022, the SII issued a resolution stating that unregistered foreign digital service providers will be subject to 19 On March 14, 2023, the SII issued a resolution stating that, although the SII lacks the power to qualify an activity as legal or illegal (which had been noted in previous SII resolutions), the SII is not empowered to register taxpayers for the simplified VAT regime who carry out activities that have been declared illegal by other State authorities that do have the power to qualify an activity as legal or illegal. It then notes that the SII has been informed by the Superintendency of Gambling Casinos that the offering of games of chance is only expressly authorized in certain instances under Chilean law, and thus taxpayers without domicile or residence in Chile that offer them are doing so illegally. As a result, the SII has excluded these taxpayers from the simplified VAT regime, effectively contradicting past guidance that stated the digital VAT law must be applied to online gaming and betting platforms. On September 12, 2023, the Supreme Court of Chile issued a ruling requiring one telecommunication company to block 23 iGaming websites. The ruling related specifically to one local internet service provider (“ISP”), and a state-owned land-based casino which holds the rights to offer online sports betting (“the Local Provider”). The order to block the websites only applied to the 23 specific URL addresses mentioned in the legal action. The Local Provider’s legal action was based on a “protection recourse” filing and assert that the Local Provider’s constitutional right to maintain a legal monopoly over sports betting was infringed upon. The Supreme Court of Chile’s ruling only affected the named parties of the case and did not establish legal precedent. In response to the ruling, the Company modified the URL and resumed operations. On December 12, 2023, the Chamber of Deputies Hall held a legislative discussion on a bill that regulates the development of online betting platforms in Chile. The bill was approved by the Chamber and will proceed to the second constitutional process in the Senate. The Company does not believe its activities in Chile are illegal based on external legal opinions obtained in previous years and updated external legal opinions supporting the Company’s assertions. The Company had previously not registered for the Chilean VAT on digital service providers as the Company believed the application of VAT on gross customer deposits, as previously clarified by the SII, prior to the March 2023 resolution, did not represent a reasonable application of the law to the economic substance of the Company’s services; this previous application would have resulted in a material loss to the Company. The Company believes that Chilean tax laws and regulations support that only the fees directly charged by the Company’s platform, primarily poker fees, should be the taxable base for the Chilean digital VAT and has obtained an external legal opinion supporting this position, the application of which would not have a material impact to the Company’s financial statements. However, as a result of the SII excluding the Company’s activities from the digital VAT registration, we no longer believe a liability is probable for the past activities as of December 31, 2022 as the Company is now effectively prevented from complying with the digital VAT law. However, there is uncertainty as to the regulated environment, what amounts may be ultimately due on our previous activities and the ability to operate in this jurisdiction until the SII resolves the position. Resolution of this matter may result in fines, penalties, additional expenses or require us to exit the market. Revenues from Chile represented 21.8 33.4 21.4 31.0 Synthetic Equity Pursuant to the binding term sheet previously entered into with Red Rock Resorts, Inc., the Company entered into the Master Gaming Services Agreement with Station Casinos LLC (“Station”) on March 30, 2023, to launch GameSTACK and GAN Sports RMiG and sportsbook solutions at its properties through self-service kiosks as well as through on-premises and statewide mobile versions in Nevada, subject to applicable licensure. As an additional incentive for Station to support the commercial success of the launch in Nevada, the Master Gaming Services Agreement includes a Synthetic Equity Addendum which would require that the Company make a payment to Station in the event of a change of control in the Company (the “Change of Control Payment”), subject to certain conditions outlined in the Synthetic Equity Addendum. The Change of Control Payment is payable only in the event that a change of control occurs during the period as specified by the Synthetic Equity Addendum and that the Company’s market capitalization has increased during that time, calculated as proscribed by the Synthetic Equity Addendum, which the amount of such payment ranging from 2.5 5 2.00 1.1 On November 7, 2023, the Company entered into the Merger Agreement at a share price of $ 1.97 2.00 0 0.3 0.3 The underlying revenue arrangement commenced in December 2023, and the asset is probable of recovery. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the results of the Parent and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect all adjustments, in the opinion of management, of a normal recurring nature that are necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. The financial data and other financial information disclosed in these notes to the condensed consolidated financial statements related to these periods are also unaudited. The results of operations for the three and six months ended June 30, 2024, are not necessarily indicative of the results that may be expected for the year ended December 31, 2023, or for any future annual or interim period. The condensed consolidated balance sheet as of December 31, 2023, included herein was derived from the audited consolidated financial statements as of that date. The accompanying unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
Liquidity | Liquidity The accompanying condensed consolidated financial statements have been prepared on a going concern basis. As of June 30, 2024, the Company had an accumulated deficit of $ 315.2 36.9 10.2 1.7 5.9 0.9 30.0 27.6 Additionally, the Company’s current financial condition, liquidity resources, and planned near-term cash flows from operations are sensitive to changes in macro-economic conditions, and the substantial variability inherent in the Company’s wager-based revenues streams. These factors, when considered together with potential covenant breaches under the Company’s Credit Facility indicate uncertainty related to the ability of the company to meet its current obligations as they come due. On April 13, 2023, a subsidiary of the Company executed agreements to amend the Credit Facility and increase the principal balance from $ 30.0 42.0 10.0 To the extent that the Company’s current resources, including its ability to generate operating cash flows, are insufficient to satisfy its cash requirements, the Company may seek additional equity or debt financing. The Company’s ability to do so depends on prevailing economic conditions and other factors, many of which are beyond management’s control. The Company does not currently have any such credit facilities or similar debt arrangements in place, outside of the Amended Credit Facility described above, and cannot provide any assurance as to the availability or terms of any additional future financing that it may require to support its operations. If the needed financing is not available, or if the terms of financing are less desirable than expected, the Company may be forced to decrease its level of investment in new products and technologies, discontinue further expansion of the business, or scale back its existing operations, any of which could have an adverse impact on the Company and its financial prospects. |
Use of Estimates | Use of Estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Due to the inherent uncertainties involved in making estimates, actual results could differ from the original estimates, and may require significant adjustments to these reported balances in future periods. |
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions The Company’s reporting currency is the U.S. Dollar while the Company’s foreign subsidiaries use their local currencies as their functional currencies. The assets and liabilities of foreign subsidiaries are translated to U.S. Dollars based on the current exchange rate prevailing at each reporting period. Revenue and expenses are translated into U.S. Dollars using the average exchange rates prevailing for each period presented. Translation adjustments that arise from translating a foreign subsidiary’s financial statements from their functional currency to U.S. Dollars are reported as a separate component of accumulated other comprehensive loss in shareholders’ equity (deficit). Gains and losses arising from transactions denominated in a currency other than the functional currency are included in general and administrative expense in the condensed consolidated statements of operations as incurred. Foreign currency transaction and remeasurement gains and losses were a net loss of $ 780 392 1,057 1,016 |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of its cash and trade receivables. The Company holds cash deposits in foreign countries, primarily in Northern Europe and Latin America, of approximately $ 28.8 1.9 The Company maintains an allowance for potential credit losses, but historically has not experienced any significant losses related to individual customers or groups of customers in any particular geographic area. |
Risks and Uncertainties | Risks and Uncertainties Macroeconomic conditions can materially adversely affect the Company’s business, results of operations and financial condition. Recent adverse macroeconomic conditions, including inflation, higher interest rates, slower growth or recession, the strengthening of the U.S. dollar, and corresponding currency fluctuations can have an adverse material impact on the Company’s future results of operations, cash flows, and financial condition, particularly with respect to foreign currency adjustments relating to our international operations. Such conditions may also affect consumers’ willingness to make discretionary purchases, and therefore the Company, along with its casino operator customers, may experience a decline in wagering. A downturn in the economic environment can also lead to increased credit and collectability risk on the Company’s trade receivables, limitations on the Company’s ability to issue new debt, and reduced liquidity. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
Revenue Recognition | Revenue Recognition Revenue from B2B Operations The Company’s revenue from its B2B operations are primarily from its internet gaming Software-as-a-Service (“SaaS”) platform, GameSTACK, that its customers use to provide RMiG, online sports gaming and SIM services to its end users. The Company enters into contracts with its customers that generally range from three to five years and include renewal provisions. These contracts generally include provision of the internet gaming platform, content consisting of proprietary and third-party games, development services and support and marketing services. In certain cases, the contract may include computer hardware to be procured on behalf of the customer. The customers cannot take possession of the hosted GameSTACK software, and the Company does not sell or license the GameSTACK software. The Company charges fees as consideration for use of its internet gaming system, game content, support and marketing services based on a fixed percentage of the casino operator’s net gaming revenue or net sportsbook win, at the time of settlement of an event for RMiG contracts, considered usage-based fees, or at the time of purchase for in-game virtual credit for SIM contracts. The determination of the fee charged to its customers is negotiated and varies significantly. Certain of these RMiG contracts provide the Company with a minimum monthly revenue guarantee in relation to the Company’s share of the casino operator’s net gaming revenue or net sportsbook win. At June 30, 2024 the remaining unsatisfied performance obligations related to fixed minimum guaranteed revenue totaled $ 45.4 the Company expects to satisfy $33.0 million within the next five year period, and the remaining over a ten year period. The Company’s promise to provide the RMiG SaaS platform and content licensing services on the hosted software is a single performance obligation. This performance obligation is recognized over time, as the Company provides services to its customers in its delivery of services to the player end user. The Company’s customers simultaneously receive and consume the benefits provided by the Company as it delivers services to its customers. Usage based fees are considered variable consideration as the service is to provide unlimited continuous access to its hosted application and usage of the hosted system is primarily controlled by the player end user. The transaction price includes fixed and variable consideration and is billed monthly with the amount due generally thirty days from the date of the invoice. Variable consideration is allocated entirely to the period in which consideration is earned as the variable amounts relate specifically to the customer’s usage of the platform that day and allocating the usage-based fees to each day is consistent with the allocation objective, primarily that the change in amounts reflect the changing value to the customer. The Company’s internet gaming system, game content, support and marketing services are provided equally throughout the term of the contract. These services are made up of a daily requirement to provide access and use of the internet gaming system and optional support and marketing services to the customer over the same period of time. The series of distinct services represents a single performance obligation that is satisfied over time. Purchases of virtual credits within a transaction period on the SIM platform, generally a monthly convention, are earned over time, and are typically billed monthly upon the close of the respective period as the credit has no monetary value, cannot be redeemed, exchanged, transferred or withdrawn, represents solely a device for tracking game play during the month, does not obligate the Company to provide future services and the arrangements with the customer and player end user have no substantive termination penalty. In certain service agreements with its SIM customers, the fees collected by the Company from third-party payment processors for the purchases of in-game virtual credits made by end-users include the SIM customer’s portion. The Company records the SIM customer’s portion as a liability as cash is collected and remits payment to the SIM customer for their share of the SIM revenues monthly. At June 30, 2024 and December 31, 2023, the Company recorded a liability due to its customers for their share of the fees of $ 1,889 1,994 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) The Company uses third-party content providers in supplying game content in its performance of providing game content on its platform to its customers. A customer has access to the Company’s propriety and licensed game content and additionally, the customer can direct the Company to procure third-party game content on its behalf. The Company has determined it acts as the principal for providing the game content when the Company controls the game content, and therefore presents the revenue on a gross basis in the condensed consolidated statements of operations. When the customer directs the Company to procure third-party game content, the Company determined it is deemed an agent for providing such game content, and therefore, records the revenue, net of the costs of content license fees, in the condensed consolidated statements of operations. The Company also provides ongoing development services involving updates to the RMiG platforms for enhanced functionality or customization. Ongoing development services are typically billed monthly, at a daily rate, for services performed. Revenue from RMiG platform development services that are identified as distinct performance obligations and enhance or create an asset the customer controls as the Company performs the services are recognized over time as services are performed. This revenue is measured using an input method based on effort expended, which uses direct labor hours incurred. These services have primarily related to post-launch development of third-party application integration software in the customer’s environment. Separately, the revenue generated from customers for development services that are distinct performance obligations and the customer benefits from the integrated SaaS offering are deferred over the license service term. These services have primarily related to enhancements to the Company’s platforms that do not enhance or create an asset the customer controls. In customer contracts that require a portion of the consideration to be received in advance or at the commencement of the contract, such amounts are recorded as a contract liability. Other services include the resale of third-party computer hardware, such as servers and other related hardware devices, upon which the GameSTACK software is installed for its customers. These products are not required to be purchased to access the GameSTACK platform but are sold as a convenience to the customer. The Company procures the computer hardware on the customer’s behalf for a fee determined based on the cost of the computer hardware plus a markup. The Company charges a hardware deployment fee which is a one-time fee for installation, testing and certification of the computer hardware at the gaming hosting facility. Revenue is recognized at the point in time when control of the hardware transfers to the customer. Control is transferred after the hardware has been procured, delivered, installed at the customer’s premises and configured to allow for remote access. The Company has determined that it is acting as the principal in providing computer hardware and related services as it assumes responsibility for procuring, delivering, installing and configuring the hardware at the customer’s location and takes control of the hardware, prior to transfer. Revenue is presented at the gross amount of consideration to which it is entitled from the customer in exchange for the computer hardware and related services. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) Contracts with Multiple Performance Obligations For customer contracts that have more than one performance obligation, the transaction price is allocated to the performance obligations in an amount that depicts the relative stand-alone selling prices of each performance obligation. Judgment is required in determining the stand-alone selling price for each performance obligation. In determining the allocation of the transaction price, an entity is required to maximize the use of observable inputs. When the stand-alone selling price of a good or service is not directly observable, an entity is required to estimate the stand-alone selling price. Contracts with its customers may include platform and licensing of game content services, as well as development services and computer hardware services. The variable consideration generated from the platform and the licensing of game content is allocated entirely to the performance obligations for platform and licensing of game content services and the remaining fixed fees for development services and computer hardware would be allocated to each of the remaining performance obligation based on their relative stand-alone selling prices. The variable consideration relates entirely to the effort to satisfy the platform and licensing game content services and the fixed consideration relates to the remaining performance obligations which is consistent with the allocation objective. Revenue from B2C Gaming Operations The Company operates the B2C gaming site www.coolbet.com outside of the U.S., which contains proprietary software and includes the following product offerings: sportsbook, poker, casino, live casino and virtual sports. The Company manages an online sportsbook allowing users to place various types of wagers on the outcome of sporting events conducted around the world. The Company operates as the bookmaker and offers fixed odds wagering on such events. When a user’s wager wins, the Company pays the user a pre-determined amount known as fixed odds. Revenue from online sportsbook is reported net after deduction of player winnings and bonuses. Revenue from wagers is recognized when the outcome of the event is known. The Company offers live casino through its digital online casino offering in select markets, allowing users to place a wager and play games virtually at retail casinos. The Company offers users a catalog of over 7,600 Peer-to-peer poker offerings allow users to play poker against one another on the Company’s online poker platform for prize money. Revenue is recognized as a percentage of the reported rake. Additionally, the Company offers tournament poker which allows users to buy-in for a fixed price for prize money. For tournament play, revenue is recognized for the difference between the entry fees collected and the amounts paid out to users as prizes and winnings. In each of the online gaming products, a single performance obligation exists at the time a wager is made to operate the games and award prizes or payouts to users based on a particular outcome. Revenue is recognized at the conclusion of each contest, wager, or wagering game hand. Additionally, certain incentives given to users, for example, that allow the user to make an additional wager at a reduced price, may provide the user with a material right which gives rise to a separate performance obligation. The Company allocates a portion of the user’s wager to incentives that create material rights that are redeemed or expired in the future. The allocated revenue for gaming wagers is primarily recognized when the wagers occur because all such wagers settle immediately. The Company applies a practical expedient by accounting for revenue from gaming on a portfolio basis because such wagers have similar characteristics, and the Company reasonably expects the effects on the financial statements of applying the revenue recognition guidance to the portfolio to not differ materially from that which would result if applying the guidance to an individual wagering contract. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
Cost of Revenue | Cost of Revenue Cost of revenue consists primarily of variable costs. These include mainly (i) content license fees, (ii) payment processing fees and chargebacks, (iii) platform technology, software, and connectivity costs directly associated with revenue generating activities, (iv) gaming duties, and (v) sportsbook feed / provider services. The Company incurs payment processing fees on B2C user deposits, withdrawals, and deposit reversals from payment processors. Cost of revenue excludes depreciation of the servers on which the Company’s gaming platforms reside as well as amortization of intangible assets including internally developed software. |
Sales and Marketing | Sales and Marketing Sales and marketing expenses consist primarily of general marketing and advertising costs, B2C user acquisition expenses and personnel costs within our sales and marketing functions. Sales and marketing costs are expensed as incurred. |
Product and Technology | Product and Technology Product and technology expenses consist primarily of personnel costs associated with development and maintenance activities that are not capitalized. These costs primarily represent employee expenses (including but not limited to, salaries, bonus, employee benefits, employer tax expenses, and share-based compensation) for personnel and contractors involved in the design, development, and project management of our proprietary technologies as well as developed and licensed content. |
General and Administrative | General and Administrative General and administrative expenses consist of costs, including gaming operations costs, not related to sales and marketing, product and technology or revenue. General and administrative costs include professional services (including legal, regulatory and compliance, audit, and consulting expenses), rent contingencies, insurance, allowance for credit losses, foreign currency transaction gains and losses, and costs related to the compensation of executive and non-executive personnel, including share-based compensation. |
Content Licensing Fees | Content Licensing Fees Content licensing fees are paid to third parties for gaming content which are expensed as incurred. Content licensing fees are calculated as a percentage of net gaming revenues in respect of the third-party games, as stipulated in the third-party agreements. |
Share-based Compensation | Share-based Compensation Share-based compensation expense is recognized for share options and restricted shares issued to employees and non-employee members of the Company’s Board of Directors. The Company’s issued share options and restricted shares, which are primarily considered equity awards and include only service conditions, are valued based on the fair value of these awards on the date of grant. The fair value of the share options is estimated using a Black-Scholes option pricing model and the fair value of the restricted shares (restricted share awards and restricted share units) is based on the market price of the Company’s shares on the date of grant. Certain restricted share unit awards issued to non-employee members of the Company’s Board of Directors permit shares upon vesting to be withheld, as a means of meeting the non-employee director’s tax withholding requirements and paid in cash to the non-employee director. The Company additionally incurs share-based compensation expense under compensation arrangements with certain of its employees under which the Company will settle bonuses for a fixed dollar amount by issuing a variable number of shares based on the Company’s share price on the settlement date. These awards are classified as liability-based awards which are measured based on the fair value of the award at the end of each reporting period until settled. Related compensation expense is recognized based on changes to the fair value over the applicable service period. Share-based compensation is recorded over the requisite service period, generally defined as the vesting period. For awards with graded vesting and only service conditions, compensation cost is recorded on a straight-line basis over the requisite service period of the entire award. Forfeitures are recorded in the period in which they occur. |
Earnings Per Share, Basic and Diluted | Earnings Per Share, Basic and Diluted Basic earnings per share is calculated by dividing earnings by the weighted average number of ordinary shares outstanding during the year. In periods of loss, basic and diluted per share information are the same. |
Cash | Cash Cash is comprised of cash held at banks and third-party service providers (“ 4.0 3.6 The Company is required to maintain compensating cash balances to satisfy its liabilities to users. Such balances are included within cash in the condensed consolidated balance sheets and are not subject to creditor claims. At June 30, 2024 and December 31, 2023, the related liabilities to users were $ 10,201 10,185 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
Capitalized Software Development Costs, net | Capitalized Software Development Costs, net The Company capitalizes certain development costs related to its internet gaming platforms during the application development stage. Costs associated with preliminary project activities, training, maintenance and all other post implementation stage activities are expensed as incurred. Software development costs are capitalized when application development begins, it is probable that the project will be completed, and the software will be used as intended. The Company capitalizes certain costs related to specific upgrades and enhancements when it is probable that expenditures will result in additional functionality of the platform to its customers. The capitalization policy provides for the capitalization of certain payroll and payroll related costs for employees who spent time directly associated with development and enhancements of the platform. Capitalized software development costs are amortized on a straight-line basis over their estimated useful lives, which generally ranges from three five years GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
Long-lived Assets | Long-lived Assets Long-lived assets, except goodwill, consist of property and equipment, and finite lived acquired intangible assets, such as developed software, gaming licenses, trademarks, trade names and customer relationships. Intangible assets are amortized on a straight-line basis over their estimated useful lives. The Company considers the period of expected cash flows and underlying data used to measure the fair value of the intangible assets when selecting the estimated useful lives. Gaming licenses include license applications fees and market access payments in connection with agreements that the Company enters with strategic partners. The market access arrangements authorize the Company to offer online gaming and online sports betting in certain regulated markets. These costs are capitalized and amortized on a straight-line basis over their estimated useful lives, beginning with the commencement of operations. The fair value of acquired intangible assets are primarily determined using the income approach. In performing these valuations, the Company’s key underlying assumptions used in the discounted cash flows were projected revenue, gross margin expectations and operating cost estimates. There are inherent uncertainties and management judgment is required in these valuations. Long-lived assets, except goodwill, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company compares the undiscounted cash flows expected to be generated by that asset or asset group to their carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment charge is recognized to the extent that the carrying amount exceeds fair value. Fair value is determined through various techniques, such as discounted cash flow models using probability weighted estimated future cash flows and the use of valuation specialists. During the three and six months ended June 30, 2024, there was no triggering event that would cause the Company to believe the value of its long-lived assets should be impaired. |
Liabilities to Users | Liabilities to Users The Company records liabilities for user account balances. User account balances consist of user deposits, promotional awards and user winnings less user withdrawals and user losses. |
Legal Contingencies and Litigation Accruals | Legal Contingencies and Litigation Accruals On a quarterly basis, the Company assesses potential losses in relation to pending or threatened legal matters. If a loss is considered probable and the amount can be reasonably estimated, the Company recognizes an expense for the estimated loss. Estimates of any such loss are subjective in nature and require the evaluation of numerous facts and assumptions as to future events, including the application of legal precedent which may be conflicting. To the extent these estimates are more or less than the actual liability resulting from the resolution of these matters, the Company’s financial results will increase or decrease accordingly. Legal costs associated with loss contingencies are expensed as incurred. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
Debt | Debt Debt issuance costs incurred in connection with the issuance of new debt are recorded as a reduction to the long-term debt balance on the condensed consolidated balance sheets and amortized over the term of the loan commitment as interest expense in the accompanying condensed consolidated statements of operations. The Company calculates amortization expense on capitalized debt issuance costs using the effective interest method in accordance with Accounting Standards Codification (“ASC”) 470, Debt. |
Leases | Leases The Company determines if an arrangement is a lease and classifies as operating or finance lease at the lease commencement date. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of an asset for a time period in exchange for consideration. In accordance with ASC 842, Leases, the Company recognizes for all leases, except short-term leases, at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use (“ROU”) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The Company accounts for the lease and non-lease components of its leases as a single lease component. Operating leases are included in operating lease ROU assets and operating lease liabilities, current and noncurrent, on the condensed consolidated balance sheets. Lease expense is recognized on a straight-line basis based on the total contractually required lease payments, over the term of the lease. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company applies the provisions of ASC 820, Fair Value Measurements and Disclosures, which provides a single authoritative definition of fair value, sets out a framework for measuring fair value and expands on required disclosures about fair value measurement. Fair value represents the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company uses the following hierarchy in measuring the fair value of the Company’s assets and liabilities, focusing on the most observable inputs when available: ● Level 1 Quoted prices in active markets for identical assets or liabilities. ● Level 2 Observable inputs other than Level 1 quoted prices, such as quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active for identical or similar assets and liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 Valuations are based on the inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Valuation techniques used to measure the fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The Company does not hold any significant Level 2 financial instruments. Level 3 financial instruments held by the Company include synthetic equity liability due to a customer. See Note 15 — Commitments and Contingencies for further detail. The instrument includes Level 3 inputs related to the contractual forecasts, in addition to observable inputs such as the stock volatility of the company, which are utilized in the Company’s Monte Carlo valuation. The valuation is not sensitive to significant movements in the forecast. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (in thousands, except share and per share amounts) |
Income Taxes | Income Taxes The Company is subject to income taxes in the United States, U.K., Bulgaria, Israel, Canada, Estonia, Malta, and Mexico. The Company records an income tax expense for the anticipated tax consequences of the reported results of operations using the asset and liability method. Under this method, deferred income tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, as well as for loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. The effect on deferred income tax of a change in tax rates are recorded in the period of the enactment. Deferred tax assets are reduced, through a valuation allowance, if necessary, by the amount of such benefits that are not expected to be realized based on current available evidence. In evaluating the Company’s ability to recover deferred tax assets in the jurisdiction from which they arise, all available positive and negative evidence is considered, including results of recent operations, scheduled reversals of deferred tax liabilities, projected future taxable income, and tax-planning strategies. The Company records a valuation allowance to reduce its deferred tax assets to the net amount that it believes is more likely than not to be realized. The Company recognizes tax benefits from uncertain tax positions only if management believes that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. Although the Company believes that it has adequately provided for uncertain tax positions, no assurance can be given that the final tax outcome of these matters would not be materially different. Adjustments are made when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences would affect the provision for income taxes in the period in which such determination is made and could have a material impact on the Company’s financial condition and operating results. The Company recognizes penalties and interest related to income tax matters in income tax expense. |
Segments | Segments The Company operates in two operating segments, B2B and B2C. Operating segments are defined as components of an enterprise where separate financial information is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assess the Company’s performance. The Company’s CODM is the Chief Executive Officer. The CODM allocates resources and assesses performance based upon discrete financial information at the operating segment level. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment, net is recorded in other assets in the condensed consolidated balance sheets at June 30, 2024 and December 31, 2023 and consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT Life (in years) 2024 2023 Estimated Useful June 30, December 31, Life (in years) 2024 2023 Fixtures, fittings and equipment 3 5 $ 4,424 $ 5,052 Platform hardware 5 1,975 2,251 Total property and equipment, cost 6,399 7,303 Less: accumulated depreciation (2,909 ) (3,144 ) Total $ 3,490 $ 4,159 |
CAPITALIZED SOFTWARE DEVELOPM_2
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Research and Development [Abstract] | |
SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET | Capitalized software development costs, net at June 30, 2024 and December 31, 2023 consisted of the following: SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET June 30, December 31, 2024 2023 Capitalized software development costs $ 11,689 $ 10,759 Development in progress 126 494 Total capitalized software development, cost 11,815 11,253 Less: accumulated amortization (4,111 ) (2,883 ) Total $ 7,704 $ 8,370 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS | Definite-lived intangible assets, net consisted of the following: SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS Average Gross Net Weighted June 30, 2024 Average Gross Net Amortization Carrying Accumulated Carrying Period (in years) Amount Amortization Amount Developed technology 5.0 $ 33,553 $ (28,556 ) $ 4,997 Customer relationships 3.3 6,805 (5,917 ) 888 Trade names and trademarks 10.0 5,378 (2,143 ) 3,235 Gaming licenses 5.3 3,798 (2,265 ) 1,533 $ 49,534 $ (38,881 ) $ 10,653 Average Gross Net Weighted December 31, 2023 Average Gross Net Amortization Carrying Accumulated Carrying Period (in years) Amount Amortization Amount Developed technology 5.0 $ 34,669 $ (28,711 ) $ 5,958 Customer relationships 3.3 6,977 (5,835 ) 1,142 Trade names and trademarks 10.0 5,549 (1,889 ) 3,660 Gaming licenses 5.4 3,617 (2,019 ) 1,598 $ 50,812 $ (38,454 ) $ 12,358 |
SCHEDULE OF FINITE -LIVED INTANGIBLE ASSETS, AMORTIZATION EXPENSE | Estimated amortization expense for the next five years is as follows: SCHEDULE OF FINITE -LIVED INTANGIBLE ASSETS, AMORTIZATION EXPENSE Amount Remainder of 2024 $ 1,685 2025 3,182 2026 2,725 2027 2,139 2028 908 Thereafter 14 Total $ 10,653 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF LONG TERM DEBT | The carrying values of the Company’s long-term debt consist of the following: SCHEDULE OF LONG TERM DEBT Effective Interest Rate As of June 30, 2024 Credit Facility Principal 10.22 % $ 46,453 Less unamortized debt issuance costs (1,955 ) Long-term debt, net $ 44,498 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
SCHEDULE OF SHARE-BASED COMPENSATION, STOCK OPTION ACTIVITY | A summary of the share option activity as of and for the six months ended June 30, 2024 is as follows: SCHEDULE OF SHARE-BASED COMPENSATION, STOCK OPTION ACTIVITY Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Shares Price Term Value Outstanding at December 31, 2023 2,680,190 $ 5.69 6.43 $ 1,877 Granted 50,000 0.01 Exercised (8,012 ) 0.01 Forfeited/expired or cancelled (274,841 ) 5.15 Outstanding at June 30, 2024 2,447,337 $ 5.66 6.13 $ 1,899 Options exercisable at June 30, 2024 1,786,821 $ 6.92 5.29 $ 986 |
SCHEDULE OF SHARE BASED COMPENSATION, RESTRICTED STOCK UNIT ACTIVITY | A summary of the restricted share unit activity as of and for the six months ended June 30, 2024 is as follows: SCHEDULE OF SHARE BASED COMPENSATION, RESTRICTED STOCK UNIT ACTIVITY Weighted Average Number of Grant Date Shares Fair Value Outstanding at December 31, 2023 2,212,244 $ 2.49 Granted — — Vested (484,614 ) 2.68 Forfeited/expired or cancelled (46,918 ) 3.11 Outstanding at June 30, 2024 1,680,712 $ 2.42 |
Other Loss (Income), Net (Table
Other Loss (Income), Net (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Other Loss Income Net | |
SCHEDULE OF OTHER LOSS (INCOME),NET | Other loss (income), net consisted of the following: SCHEDULE OF OTHER LOSS (INCOME),NET 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Other income (1) $ — $ (427 ) $ (26 ) $ (9,718 ) Other loss (2) 27 8,784 27 8,784 Total other loss (income), net $ 27 $ 8,358 $ 1 $ (934 ) (1) Includes gain on extinguishment of $ 0.4 9.7 15.0 (2) Includes loss on debt extinguishment of $ 8.8 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE | SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Share options 2,447,337 3,488,663 2,447,337 3,488,663 Restricted shares — 17,218 — 17,218 Restricted share units 1,680,712 1,862,370 1,680,712 1,862,370 Total 4,128,049 5,368,251 4,128,049 5,368,251 |
REVENUE (Tables)
REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES | The following table reflects revenue recognized for the three and six months ended June 30, 2024 and 2023 in line with the timing of transfer of services: SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Revenue from services delivered at a point in time $ 22,570 $ 23,863 $ 40,875 $ 47,763 Revenue from services delivered over time 12,990 9,895 25,336 21,124 Total $ 35,560 $ 33,758 $ 66,211 $ 68,887 |
SCHEDULE OF CONTRACT WITH CUSTOMERS | The following table reflects contract liabilities arising from cash consideration received in advance from customers for the periods presented: SCHEDULE OF CONTRACT WITH CUSTOMERS 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Contract liabilities from advance customer payments, beginning of the period $ 9,000 $ 2,655 7,873 $ 2,117 Contract liabilities from advance customer payments, end of the period (1) 8,946 2,607 8,946 2,607 Revenue recognized from amounts included in contract liabilities from advance customer payments at the beginning of the period 1,103 263 1,287 457 (1) Contract liabilities from advance customer payments, end of period consisted of $ 5,279 1,760 3,667 847 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS | Summarized financial information by reportable segments for the three months ended June 30, 2024 and 2023 is as follows: SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS B2B B2C Total B2B B2C Total Three Months Ended June 30, 2024 2023 B2B B2C Total B2B B2C Total Revenue $ 12,990 $ 22,570 $ 35,560 $ 9,895 $ 23,863 $ 33,758 Cost of revenue (1) 2,211 8,033 10,244 2,078 7,407 9,485 Segment contribution $ 10,779 $ 14,537 $ 25,316 $ 7,817 $ 16,456 $ 24,273 (1) Excludes depreciation and amortization expense. B2B B2C Total B2B B2C Total Six Months Ended June 30, 2024 2023 B2B B2C Total B2B B2C Total Revenue $ 25,336 $ 40,875 $ 66,211 $ 21,174 $ 47,713 $ 68,887 Cost of revenue (1) 4,292 15,275 19,567 4,073 15,573 19,646 Segment contribution $ 21,044 $ 25,600 $ 46,644 $ 17,101 $ 32,140 $ 49,241 (1) Excludes depreciation and amortization expense. |
SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT CONTRIBUTION TO CONSOLIDATED LOSS BEFORE INCOME TAXES | The following table presents a reconciliation of segment gross profit to the consolidated loss before income taxes for the three and six months ended June 30, 2024 and 2023: SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT CONTRIBUTION TO CONSOLIDATED LOSS BEFORE INCOME TAXES 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Segment contribution (1) $ 25,316 $ 24,273 $ 46,644 $ 49,241 Sales and marketing 7,056 7,324 13,073 14,508 Product and technology 8,137 11,238 17,753 20,816 General and administrative (1) 7,980 10,029 15,139 20,035 Depreciation and amortization 1,914 4,243 3,753 8,444 Interest expense, net 1,157 905 2,289 2,621 Other loss (income), net 27 8,358 1 (934 ) Loss before income taxes $ (955 ) $ (17,824 ) $ (5,364 ) $ (16,249 ) (1) Excludes depreciation and amortization expense. |
SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT | The following table disaggregates total revenue by product and services for each segment: SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 B2B: Platform and content license fees $ 8,703 $ 7,243 $ 18,369 $ 15,870 Development services and other 4,287 2,652 6,967 5,304 Total B2B revenue 12,990 9,895 25,336 21,174 B2C: Sportsbook 9,514 10,298 15,387 20,265 Casino 12,303 12,972 24,012 26,161 Poker 753 593 1,476 1,287 Total B2C revenue 22,570 23,863 40,875 47,713 Total revenue $ 35,560 $ 33,758 $ 66,211 $ 68,887 |
SCHEDULE OF REVENUE BY LOCATION OF THE CUSTOMER | Revenue by location of the customer for the three and six months ended June 30, 2024 and 2023 is as follows: SCHEDULE OF REVENUE BY LOCATION OF THE CUSTOMER 2024 2023 2024 2023 Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 United States $ 10,454 $ 7,296 $ 19,546 $ 15,812 Europe 14,120 12,107 25,728 24,784 Latin America 8,204 12,388 15,100 23,658 Rest of the world 2,782 1,967 5,837 4,633 Total revenue $ 35,560 $ 33,758 $ 66,211 $ 68,887 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Leases | |
SCHEDULE OF OPERATING ASSET AND LIABILITY | The following table discloses the operating asset and liability balances at June 30, 2024 and December 31, 2023: SCHEDULE OF OPERATING ASSET AND LIABILITY As of June 30, 2024 December 31, 2023 Leases Classification Assets Total operating leased assets, net Operating lease right-of-use assets (1) (1) $ 3,822 $ 4,340 Liabilities Current Operating lease liabilities $ 811 $ 804 Non-current Operating lease liabilities – non-current 3,041 3,577 Total lease liabilities $ 3,852 $ 4,381 (1) Operating lease right-of-use assets are recorded, net of accumulated amortization of $ 744 378 |
SCHEDULE OF FUTURE MINIMUM MATURITIES OF OPERATING LEASE LIABILITIES | Maturities of lease liabilities, including reconciliation to the lease liabilities, based on required contractual payments, are as follows: SCHEDULE OF FUTURE MINIMUM MATURITIES OF OPERATING LEASE LIABILITIES Operating Leases Remainder of 2024 $ 568 2025 1,137 2026 1,137 2027 1,137 2028 636 Total lease payments 4,615 Less: future interest costs 762 Present value of lease liabilities $ 3,852 |
SCHEDULE OF FINANCE AND OPERATING RELATED TO LEASES | Other information related to leases as of and for the six months ended June 30, 2024 and 2023 was as follows: SCHEDULE OF FINANCE AND OPERATING RELATED TO LEASES Six Months Ended June 30, 2024 2023 Operating lease weighted-average remaining lease term (years) 4.0 4.9 Operating lease weighted-average discount rate 9.0 % 8.9 % Cash paid for the amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 573 $ 215 |
NATURE OF OPERATIONS (Details N
NATURE OF OPERATIONS (Details Narrative) - $ / shares | Jun. 30, 2024 | Nov. 07, 2023 | Jun. 30, 2023 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Share price | $ 0.01 | $ 0.01 | |
Merger Consideration [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Share price | $ 1.97 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||
Apr. 30, 2022 USD ($) | Jun. 30, 2024 USD ($) Integer | Mar. 31, 2024 USD ($) | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Jun. 30, 2024 USD ($) Integer | Jun. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) | Apr. 14, 2023 USD ($) | Apr. 13, 2023 USD ($) | Apr. 26, 2022 USD ($) | |
Property, Plant and Equipment [Line Items] | |||||||||||
Accumulated deficit | $ 315,196 | $ 315,196 | $ 309,305 | ||||||||
Cash | 36,861 | 36,861 | 38,578 | ||||||||
Liabilities to users | 10,201 | 10,201 | 10,185 | ||||||||
Net loss | 1,731 | $ 4,160 | $ 18,409 | $ (1,501) | 5,891 | $ 16,908 | |||||
Net cash provided by used in operating activities | 909 | (1,348) | |||||||||
Proceeds from issuance of long-term debt | $ 30,000 | 4,733 | |||||||||
Proceeds from line of credit | $ 27,600 | ||||||||||
Debt principal amount | 46,453 | 46,453 | $ 42,000 | $ 30,000 | $ 30,000 | ||||||
Minimum liquidity amount | $ 10,000 | ||||||||||
Foreign currency transaction | 780 | $ 392 | 1,057 | $ 1,016 | |||||||
Other current assets | 1,900 | 1,900 | |||||||||
Revenue remaining performance obligation | 45,400 | $ 45,400 | |||||||||
Revenue remaining performance obligation expected timing of satisfaction | the Company expects to satisfy $33.0 million within the next five year period, and the remaining over a ten year period. | ||||||||||
Amounts due to customers current | $ 1,889 | $ 1,889 | 1,994 | ||||||||
Number of third party gaming products available | Integer | 7,600 | 7,600 | |||||||||
Reserve balances | $ 4,000 | $ 4,000 | $ 3,600 | ||||||||
Software and Software Development Costs [Member] | Minimum [Member] | |||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||
Capitalized software development costs estimated useful lives | 3 years | 3 years | |||||||||
Software and Software Development Costs [Member] | Maximum [Member] | |||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||
Capitalized software development costs estimated useful lives | 5 years | 5 years | |||||||||
Northern Europe And Latin America [Member] | |||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||
Cash deposits | $ 28,800 | $ 28,800 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, cost | $ 6,399 | $ 7,303 |
Less: accumulated depreciation | (2,909) | (3,144) |
Total | 3,490 | 4,159 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, cost | $ 4,424 | 5,052 |
Furniture and Fixtures [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment useful life | 3 years | |
Furniture and Fixtures [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment useful life | 5 years | |
Platform Hardware [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, cost | $ 1,975 | $ 2,251 |
Property plant and equipment useful life | 5 years |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expenses | $ 385 | $ 371 | $ 801 | $ 736 |
SCHEDULE OF CAPITALIZED COMPUTE
SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Research and Development [Abstract] | ||
Capitalized software development costs | $ 11,689 | $ 10,759 |
Development in progress | 126 | 494 |
Total capitalized software development, cost | 11,815 | 11,253 |
Less: accumulated amortization | (4,111) | (2,883) |
Total | $ 7,704 | $ 8,370 |
CAPITALIZED SOFTWARE DEVELOPM_3
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Research and Development [Abstract] | ||||
Amortization expense | $ 697 | $ 490 | $ 1,340 | $ 976 |
SCHEDULE OF FINITE-LIVED INTANG
SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 49,534 | $ 50,812 |
Accumulated Amortization | (38,881) | (38,454) |
Net Carrying Amount | 10,653 | 12,358 |
Developed Technology Rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 33,553 | 34,669 |
Accumulated Amortization | (28,556) | (28,711) |
Net Carrying Amount | $ 4,997 | $ 5,958 |
Weighted Average Amortization Period | 5 years | 5 years |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 6,805 | $ 6,977 |
Accumulated Amortization | (5,917) | (5,835) |
Net Carrying Amount | $ 888 | $ 1,142 |
Weighted Average Amortization Period | 3 years 3 months 18 days | 3 years 3 months 18 days |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 5,378 | $ 5,549 |
Accumulated Amortization | (2,143) | (1,889) |
Net Carrying Amount | $ 3,235 | $ 3,660 |
Weighted Average Amortization Period | 10 years | 10 years |
License [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 3,798 | $ 3,617 |
Accumulated Amortization | (2,265) | (2,019) |
Net Carrying Amount | $ 1,533 | $ 1,598 |
Weighted Average Amortization Period | 5 years 3 months 18 days | 5 years 4 months 24 days |
SCHEDULE OF FINITE -LIVED INTAN
SCHEDULE OF FINITE -LIVED INTANGIBLE ASSETS, AMORTIZATION EXPENSE (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2024 | $ 1,685 | |
2025 | 3,182 | |
2026 | 2,725 | |
2027 | 2,139 | |
2028 | 908 | |
Thereafter | 14 | |
Total | $ 10,653 | $ 12,358 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense intangible assets | $ 834 | $ 3,383 | $ 1,614 | $ 6,732 |
SCHEDULE OF LONG TERM DEBT (Det
SCHEDULE OF LONG TERM DEBT (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | Apr. 14, 2023 | Apr. 13, 2023 | Apr. 26, 2022 |
Debt Disclosure [Abstract] | |||||
Principal | $ 46,453 | $ 42,000 | $ 30,000 | $ 30,000 | |
Effective interest rate | 10.22% | ||||
Less unamortized debt issuance costs | $ (1,955) | ||||
Long-term debt, net | $ 44,498 | $ 42,189 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Apr. 13, 2023 | Apr. 26, 2022 | Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Apr. 14, 2023 | Dec. 31, 2022 | |
Offsetting Assets [Line Items] | ||||||||
Debt principal amount | $ 30,000 | $ 30,000 | $ 46,453 | $ 46,453 | $ 42,000 | |||
Interest rate | 9.50% | |||||||
Maturity date | Oct. 26, 2026 | |||||||
Debt issuance costs | $ 2,400 | |||||||
Credit facility amount | $ 27,600 | |||||||
Prepayment premiums | 7,300 | |||||||
Loss on extinguishment of debt | $ 8,800 | $ 9,717 | ||||||
Credit facility interest rate | 8% | |||||||
Debt instrument interest rate for exit fee | 2.50% | |||||||
Debt issuance costs, net | $ 3,100 | |||||||
Financial covenant requirement minimum liquidity | $ 10,000 | |||||||
Interest expense | 1,166 | $ 913 | 2,310 | 2,307 | ||||
Amortization of debt issuance costs | $ 252 | $ 200 | $ 499 | $ 526 | ||||
Interest Rate Floor [Member] | ||||||||
Offsetting Assets [Line Items] | ||||||||
Interest rate | 1% |
SCHEDULE OF SHARE-BASED COMPENS
SCHEDULE OF SHARE-BASED COMPENSATION, STOCK OPTION ACTIVITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | ||
Number of Shares, Outstanding, Beginning balance | 2,680,190 | |
Weighted Average Exercise Price, Outstanding, Beginning balance | $ 5.69 | |
Weighted average contractual term, Outstanding, Ending | 6 years 1 month 17 days | 6 years 5 months 4 days |
Aggregate intrinsic value, Outstanding | $ 1,877 | |
Number of Shares, Granted | 50,000 | |
Weighted Average Exercise Price, Granted | $ 0.01 | |
Number of Shares, Exercised | (8,012) | |
Weighted Average Exercise Price, Exercised | $ 0.01 | |
Number of Shares, Forfeited/expired or cancelled | (274,841) | |
Weighted Average Exercise Price, Forfeited/expired or cancelled | $ 5.15 | |
Number of Shares, Outstanding, Ending balance | 2,447,337 | 2,680,190 |
Weighted Average Exercise Price, Outstanding, Ending balance | $ 5.66 | $ 5.69 |
Aggregate intrinsic value, Outstanding | $ 1,899 | $ 1,877 |
Number of Shares, Options, Exercisable at end of period | 1,786,821 | |
Weighted Average Exercise Price, Options, Exercisable at end of period | $ 6.92 | |
Weighted average contractual term, Option exercisable | 5 years 3 months 14 days | |
Aggregate intrinsic value, Options, Exercisable at end of period | $ 986 |
SCHEDULE OF SHARE BASED COMPENS
SCHEDULE OF SHARE BASED COMPENSATION, RESTRICTED STOCK UNIT ACTIVITY (Details) - Restricted Stock Units (RSUs) [Member] | 6 Months Ended |
Jun. 30, 2024 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of Shares Outstanding, Beginning Balance | shares | 2,212,244 |
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares | $ 2.49 |
Number of Shares, Granted | shares | |
Weighted Average Grant Date Fair Value, Granted | $ / shares | |
Number of Shares, Vested | shares | (484,614) |
Weighted Average Grant Date Fair Value, Vested | $ / shares | $ 2.68 |
Number of Shares, Forfeited/expired or cancelled | shares | (46,918) |
Weighted Average Grant Date Fair Value, Forfeited/expired or cancelled | $ / shares | $ 3.11 |
Number of Shares Outstanding, Ending Balance | shares | 1,680,712 |
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares | $ 2.42 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 29, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Apr. 30, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Stock options granted, exercise price per share | $ 0.01 | |||||
Weighted average grant date fair value of options granted | $ 1.55 | $ 0 | 1.55 | $ 1.70 | ||
Share price | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||
Customer Relationships [Member] | Content Licensing Agreement [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Stock issued during period, shares, new issues | 1,250,000 | |||||
Share-Based Payment Arrangement, Option [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Share-based compensation expense | $ 403 | $ 879 | $ 819 | $ 1,535 | ||
Unrecognized compensation cost | 2,077 | $ 2,077 | ||||
Weighted-average period | 2 years 3 months 18 days | |||||
Share option, vesting percentage | 25% | |||||
Description of share option awards | after one year and then monthly over the next 36 months thereafter and have a maximum term of ten years | |||||
Capitalized Software Development Costs [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Share-based compensation expense | $ 38 | 58 | ||||
Restricted Stock Units (RSUs) [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Share-based compensation expense | 386 | 749 | $ 822 | 1,396 | ||
Weighted-average period | 2 years 7 months 9 days | |||||
Restricted stock vested | 484,614 | |||||
Total unrecognized compensation cost | $ 3,407 | $ 3,407 | ||||
Restricted Stock Units (RSUs) [Member] | Officers And Non Employee Directors [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Restricted stock vested | 3,890 | |||||
Share based compensation tax expense incurred | 912 | |||||
Restricted Stock [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Share-based compensation expense | $ 41 | $ 83 | ||||
2020 Equity Incentive Plan [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Granted ordinary shares | 11,075,190 | 11,075,190 | 4,400,000 | |||
Granted ordinary shares, increased percentage | 4% | |||||
Granted ordinary shares, future issuance | 3,356,755 | 3,356,755 | ||||
2020 Plan [Member] | Share-Based Payment Arrangement, Option [Member] | European Based Employees [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Issuance of options to purchase of ordinary shares | 50,000 | |||||
Stock options granted, exercise price per share | $ 0.01 | |||||
2020 Employee Stock Purchase Plan [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Employee stock purchase plan, description | The ESPP provides initially for 300,000 ordinary shares to be sold and increases on February 1, 2022, and on each subsequent February 1 through and including February 1, 2030, equal to the lesser of (i) 0.25 percent of the number of ordinary shares issued and outstanding on the immediately preceding December 31, or (ii) 100,000 ordinary shares, or (iii) such number of ordinary shares as determined by the Board of Directors | |||||
Shares to be sold | 300,000 | |||||
Purchase price, rate | 85% | |||||
Shares issued employee stock purchase plan | 57,960 | |||||
Share-based compensation expenses | $ 18 |
DEFINED CONTRIBUTION PLANS (Det
DEFINED CONTRIBUTION PLANS (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Retirement Benefits [Abstract] | ||||
Defined contribution plan percent | 50% | |||
Defined contribution plan employee, percent | 4% | |||
Defined benefit plan contributions by employer | $ 160 | $ 177 | $ 343 | $ 355 |
SCHEDULE OF OTHER LOSS (INCOME)
SCHEDULE OF OTHER LOSS (INCOME),NET (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | ||
Other Loss Income Net | |||||
Other income | [1] | $ (427) | $ (26) | $ (9,718) | |
Other loss | [2] | 27 | 8,784 | 27 | 8,784 |
Total other loss (income), net | $ 27 | $ 8,358 | $ 1 | $ (934) | |
[1]Includes gain on extinguishment of $ 0.4 9.7 15.0 8.8 |
SCHEDULE OF OTHER LOSS (INCOM_2
SCHEDULE OF OTHER LOSS (INCOME),NET (Details) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Other Loss Income Net | |||
Gain on extinguishment | $ 400 | $ 9,700 | |
Fixed payment | 15,000 | ||
Loss on extinguishment | $ 8,800 | $ 8,784 |
SCHEDULE OF ANTI-DILUTIVE STOCK
SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 4,128,049 | 5,368,251 | 4,128,049 | 5,368,251 |
Share-Based Payment Arrangement, Option [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 2,447,337 | 3,488,663 | 2,447,337 | 3,488,663 |
Restricted Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 17,218 | 17,218 | ||
Restricted Stock Units (RSUs) [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 1,680,712 | 1,862,370 | 1,680,712 | 1,862,370 |
SCHEDULE OF REVENUE RECOGNIZED
SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Total | $ 35,560 | $ 33,758 | $ 66,211 | $ 68,887 |
Transferred at Point in Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 22,570 | 23,863 | 40,875 | 47,763 |
Transferred over Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | $ 12,990 | $ 9,895 | $ 25,336 | $ 21,124 |
SCHEDULE OF CONTRACT WITH CUSTO
SCHEDULE OF CONTRACT WITH CUSTOMERS (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | ||
Revenue from Contract with Customer [Abstract] | |||||
Contract liabilities from advance customer payments, beginning of the period | $ 9,000 | $ 2,655 | $ 7,873 | $ 2,117 | |
Contract liabilities from advance customer payments, end of the period | [1] | 8,946 | 2,607 | 8,946 | 2,607 |
Revenue recognized from amounts included in contract liabilities from advance customer payments at the beginning of the period | $ 1,103 | $ 263 | $ 1,287 | $ 457 | |
[1]Contract liabilities from advance customer payments, end of period consisted of $ 5,279 1,760 3,667 847 |
SCHEDULE OF CONTRACT WITH CUS_2
SCHEDULE OF CONTRACT WITH CUSTOMERS (Details) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | ||
Contract with customer, liability | $ 8,946 | [1] | $ 9,000 | $ 7,873 | $ 2,607 | [1] | $ 2,655 | $ 2,117 |
Other Current Liabilities [Member] | ||||||||
Contract with customer, liability | 5,279 | 1,760 | ||||||
Other Liabilities [Member] | ||||||||
Contract with customer, liability | $ 3,667 | $ 847 | ||||||
[1]Contract liabilities from advance customer payments, end of period consisted of $ 5,279 1,760 3,667 847 |
REVENUE (Details Narrative)
REVENUE (Details Narrative) - USD ($) $ in Millions | Jun. 30, 2024 | Mar. 31, 2024 | Aug. 30, 2023 |
Disaggregation of Revenue [Line Items] | |||
Optional performance obligation | $ 45.4 | ||
WynnBet Modification [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Optional performance obligation | 1.4 | $ 5 | |
WynnBet Modification [Member] | MICHIGAN | |||
Disaggregation of Revenue [Line Items] | |||
Optional performance obligation | $ 0.3 | $ 1.8 |
SCHEDULE OF FINANCIAL INFORMATI
SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | ||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue | $ 35,560 | $ 33,758 | $ 66,211 | $ 68,887 | |||||
Cost of revenue | [1] | 10,244 | 9,485 | 19,567 | 19,646 | ||||
Segment contribution | 25,316 | 24,273 | 46,644 | 49,241 | |||||
Business to Business (B2B) [Member] | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue | 12,990 | 9,895 | 25,336 | 21,174 | |||||
Cost of revenue | 2,211 | [2] | 2,078 | [2] | 4,292 | [3] | 4,073 | [3] | |
Segment contribution | 10,779 | 7,817 | 21,044 | 17,101 | |||||
Business to Consumer (B2C) [Member] | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Revenue | 22,570 | 23,863 | 40,875 | 47,713 | |||||
Cost of revenue | 8,033 | [2] | 7,407 | [2] | 15,275 | [3] | 15,573 | [3] | |
Segment contribution | $ 14,537 | $ 16,456 | $ 25,600 | $ 32,140 | |||||
[1]Excludes depreciation and amortization expense.[2]Excludes depreciation and amortization expense.[3]Excludes depreciation and amortization expense. |
SCHEDULE OF RECONCILIATION OF C
SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT CONTRIBUTION TO CONSOLIDATED LOSS BEFORE INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | ||
Segment Reporting [Abstract] | |||||
Segment contribution | $ 25,316 | $ 24,273 | $ 46,644 | $ 49,241 | |
Sales and marketing | 7,056 | 7,324 | 13,073 | 14,508 | |
Product and technology | 8,137 | 11,238 | 17,753 | 20,816 | |
General and administrative | [1] | 7,980 | 10,029 | 15,139 | 20,035 |
Depreciation and amortization | 1,914 | 4,243 | 3,753 | 8,444 | |
Interest expense, net | 1,157 | 905 | 2,289 | 2,621 | |
Other loss (income), net | 27 | 8,358 | 1 | (934) | |
Loss before income taxes | $ (955) | $ (17,824) | $ (5,364) | $ (16,249) | |
[1]Excludes depreciation and amortization expense. |
SCHEDULE OF DISAGGREGATION OF R
SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Revenue from External Customer [Line Items] | ||||
Total revenue | $ 35,560 | $ 33,758 | $ 66,211 | $ 68,887 |
Business to Business (B2B) [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenue | 12,990 | 9,895 | 25,336 | 21,174 |
Business to Consumer (B2C) [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenue | 22,570 | 23,863 | 40,875 | 47,713 |
Platform and Content License Fees [Member] | Business to Business (B2B) [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenue | 8,703 | 7,243 | 18,369 | 15,870 |
Development Services and Other [Member] | Business to Business (B2B) [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenue | 4,287 | 2,652 | 6,967 | 5,304 |
Sportsbook [Member] | Business to Consumer (B2C) [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenue | 9,514 | 10,298 | 15,387 | 20,265 |
Casino [Member] | Business to Consumer (B2C) [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenue | 12,303 | 12,972 | 24,012 | 26,161 |
Poker [Member] | Business to Consumer (B2C) [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Total revenue | $ 753 | $ 593 | $ 1,476 | $ 1,287 |
SCHEDULE OF REVENUE BY LOCATION
SCHEDULE OF REVENUE BY LOCATION OF THE CUSTOMER (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | $ 35,560 | $ 33,758 | $ 66,211 | $ 68,887 |
UNITED STATES | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | 10,454 | 7,296 | 19,546 | 15,812 |
Europe [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | 14,120 | 12,107 | 25,728 | 24,784 |
Latin America [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | 8,204 | 12,388 | 15,100 | 23,658 |
Rest of the World [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | $ 2,782 | $ 1,967 | $ 5,837 | $ 4,633 |
SEGMENT REPORTING (Details Narr
SEGMENT REPORTING (Details Narrative) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
One Customer [Member] | Revenue [Member] | B2B Segment [Member] | ||||
Revenue, Major Customer [Line Items] | ||||
Revenue percentage | 15% | 13.50% | 17.30% | 14.80% |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Effective income tax rate | 81.30% | 3.30% | 9.80% | 4.10% |
Statutory tax rate | 0% | |||
BERMUDA | ||||
Effective income tax rate | 0% | 0% | 0% | 0% |
SCHEDULE OF OPERATING ASSET AND
SCHEDULE OF OPERATING ASSET AND LIABILITY (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Leases | |||
Operating lease right-of-use assets | [1] | $ 3,822 | $ 4,340 |
Operating lease, liability, current | 811 | 804 | |
Operating lease liabilities - non current | 3,041 | 3,577 | |
Total lease liabilities | $ 3,852 | $ 4,381 | |
[1]Operating lease right-of-use assets are recorded, net of accumulated amortization of $ 744 378 |
SCHEDULE OF OPERATING ASSET A_2
SCHEDULE OF OPERATING ASSET AND LIABILITY (Details) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Leases | ||
Operating lease right-of-use assets, amortization | $ 744 | $ 378 |
SCHEDULE OF FUTURE MINIMUM MATU
SCHEDULE OF FUTURE MINIMUM MATURITIES OF OPERATING LEASE LIABILITIES (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Leases | ||
Remainder of 2024 | $ 568 | |
2025 | 1,137 | |
2026 | 1,137 | |
2027 | 1,137 | |
2028 | 636 | |
Total lease payments | 4,615 | |
Less: future interest costs | 762 | |
Present value of lease liabilities | $ 3,852 | $ 4,381 |
SCHEDULE OF FINANCE AND OPERATI
SCHEDULE OF FINANCE AND OPERATING RELATED TO LEASES (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Leases | ||
Operating lease weighted-average remaining lease term (years) | 4 years | 4 years 10 months 24 days |
Operating lease weighted-average discount rate | 9% | 8.90% |
Cash paid for the amounts included in the measurement of operating lease liabilities | $ 573 | $ 215 |
LEASES (Details Narrative)
LEASES (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Leases | ||||
Short-term lease costs | $ 85 | $ 161 | $ 181 | $ 547 |
Operating lease cost | $ 283 | $ 151 | $ 568 | $ 257 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Nov. 07, 2023 | May 13, 2022 | Apr. 25, 2022 | Jan. 27, 2022 | Jun. 30, 2021 | |
Product Liability Contingency [Line Items] | |||||||||||
Extinguishment debt | $ 9,300 | ||||||||||
Price per share | $ 2 | $ 2 | $ 2 | ||||||||
Share price | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||
Service Agreements [Member] | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Other assets and other liabilities. | $ 1,100 | $ 1,100 | |||||||||
Revenue | 0 | ||||||||||
Grant date fair value of liability | $ 300 | $ 300 | $ 300 | ||||||||
Merger Consideration [Member] | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Share price | $ 1.97 | ||||||||||
Minimum [Member] | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Percentage of market capitalization | 2.50% | 2.50% | |||||||||
Maximum [Member] | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Percentage of market capitalization | 5% | 5% | |||||||||
CHILE | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Percentage of revenue | 21.80% | 33.40% | 21.40% | 31% | |||||||
Internal Revenue Service (IRS) [Member] | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Value added tax rate | 19% | ||||||||||
Witholding on payment rate | 19% | ||||||||||
Licensing Agreements [Member] | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Contractual obligation | $ 3,000 | $ 3,000 | $ 48,500 | ||||||||
Initial payment | $ 3,500 | ||||||||||
Impairment loss | $ 3,500 | ||||||||||
Licensing Agreements [Member] | Execution [Member] | |||||||||||
Product Liability Contingency [Line Items] | |||||||||||
Payment of contractual obligation | $ 8,500 |