Cover Page
Cover Page | 12 Months Ended |
Dec. 31, 2021shares | |
Document Information [Line Items] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2021 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | FY |
Entity Registrant Name | DoubleDown Interactive Co., Ltd. |
Entity Central Index Key | 0001799567 |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | No |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 2,477,672 |
Entity Voluntary Filers | No |
Entity Interactive Data Current | No |
Entity Address, Address Line One | 13F, Gangnam Finance Center |
Entity Address, Address Line Two | 152, Teheran-ro Gangnam-gu |
Entity Address, City or Town | Seoul |
Entity Incorporation, State or Country Code | M5 |
Entity Address, Postal Zip Code | 06236 |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Document Registration Statement | false |
Document Accounting Standard | U.S. GAAP |
Entity File Number | 001-39349 |
ICFR Auditor Attestation Flag | false |
Entity Current Reporting Status | Yes |
Auditor Name | Ernst & Young LLP |
Auditor Firm ID | 42 |
Auditor Location | Seattle, WA |
Entity Address, Country | KR |
Business Contact [Member] | |
Document Information [Line Items] | |
Contact Personnel Name | Joseph A. Sigrist |
Entity Address, Address Line One | 605 5th Avenue, Suite 300 |
Entity Address, City or Town | Seattle |
Entity Address, Postal Zip Code | 98104 |
Contact Personnel Fax Number | +1-206-408-1545 |
Entity Address, State or Province | WA |
American Depositary Shares [Member] | |
Document Information [Line Items] | |
Title of 12(b) Security | American Depositary Shares |
No Trading Symbol Flag | true |
Common Shares [Member] | |
Document Information [Line Items] | |
Title of 12(b) Security | Common Shares, par value W10,000 per share |
No Trading Symbol Flag | true |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Statement of Comprehensive Income [Abstract] | ||||
Revenue | $ 363,205 | $ 358,342 | $ 273,610 | |
Operating expenses: | ||||
Cost of revenue | [1] | 126,612 | 126,255 | 99,620 |
Sales and marketing | [1] | 78,821 | 71,225 | 35,827 |
Research and development | [1] | 18,490 | 18,784 | 19,245 |
General and administrative | [1] | 22,631 | 21,721 | 17,198 |
Depreciation and amortization | 17,918 | 31,574 | 33,422 | |
Total operating expenses | 264,472 | 269,559 | 205,312 | |
Operating income | 98,733 | 88,783 | 68,298 | |
Other income (expense): | ||||
Interest expense | (2,011) | (10,786) | (26,566) | |
Interest income | 208 | 197 | 524 | |
Gain on foreign currency transactions | 1,110 | 2,347 | 4,128 | |
Gain (loss) on foreign currency remeasurement | 1,920 | (244) | 3,206 | |
Other, net | 654 | (5,080) | 277 | |
Total other income (expense), net | 1,881 | (13,566) | (18,431) | |
Income before income tax | 100,614 | 75,217 | 49,867 | |
Income tax expense | (22,506) | (21,594) | (13,542) | |
Net income | 78,108 | 53,623 | 36,325 | |
Other comprehensive income (expense): | ||||
Pension adjustments, net of tax | (286) | (294) | (385) | |
Gain (loss) on foreign currency translation | 504 | 13,676 | 9,742 | |
Comprehensive income | $ 78,326 | $ 67,005 | $ 45,682 | |
Earnings per share: | ||||
Basic | $ 33.91 | $ 29.67 | $ 30.46 | |
Diluted | $ 33.91 | $ 26.20 | $ 21.87 | |
Weighted average shares outstanding: | ||||
Basic | 2,303,200 | 1,807,410 | 1,192,725 | |
Diluted | 2,303,200 | 2,149,114 | 1,995,131 | |
[1] | Excluding depreciation and amortization |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 242,060 | $ 63,188 |
Accounts receivable, net | 21,875 | 23,299 |
Prepaid expenses, and other assets | 6,817 | 4,020 |
Total current assets | 270,752 | 90,507 |
Property and equipment, net | 384 | 377 |
Operating lease right-of-use assets, net | 6,830 | 9,987 |
Intangible assets, net | 53,679 | 71,364 |
Goodwill | 633,965 | 633,965 |
Deferred tax asset | 2,616 | 560 |
Other non-current assets | 1,582 | 71 |
Total assets | 969,808 | 806,831 |
Current liabilities: | ||
Short-term senior note | 0 | 0 |
Accounts payable and accrued expenses | 14,752 | 16,646 |
Short-term operating lease liabilities | 3,076 | 3,033 |
Income taxes payable | 0 | 2,838 |
Contract liabilities | 2,246 | 2,415 |
Other current liabilities | 730 | 717 |
Total current liabilities | 20,804 | 25,649 |
Bonds | 0 | 0 |
Long-term borrowings with related party | 42,176 | 45,956 |
Long-term operating lease liabilities | 4,688 | 7,831 |
Deferred tax liabilities, net | 28,309 | 20,154 |
Other non-current liabilities | 9,953 | 7,730 |
Total liabilities | 105,930 | 107,320 |
Shareholders' equity: | ||
Common Stock, KRW 10,000 par value - 200,000,000 Shares, 2,477,672 and 2,214,522 shares issued and outstanding | 21,198 | 18,924 |
Additional paid-in-capital | 671,831 | 588,064 |
Accumulated other comprehensive income | 23,033 | 22,815 |
Retained earnings | 147,816 | 69,708 |
Total shareholders' equity | 863,878 | 699,511 |
Total liabilities and shareholders' equity | $ 969,808 | $ 806,831 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - ₩ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Common Stock, Par or Stated Value Per Share | ₩ 10,000 | ₩ 10,000 |
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock, Shares, Issued | 2,477,672 | 2,477,672 |
Common Stock, Shares, Outstanding | 2,214,522 | 2,214,522 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Common stock [Member] | Additional paid-in-capital [Member] | Accumulated other comprehensive income/(loss) [Member] | Retained earnings (Deficit) [Member] |
Beginning balance at Dec. 31, 2018 | $ 329,862 | $ 10,603 | $ 339,423 | $ 76 | $ (20,240) |
Beginning balance (in shares) at Dec. 31, 2018 | 1,192,725 | ||||
Net Income | 36,325 | 36,325 | |||
Pension adjustments, net of tax | (385) | (385) | |||
Capital investment from parent | 5,124 | 5,124 | |||
Gain(loss) on foreign currency translation, net of tax | 9,742 | 9,742 | |||
Ending balance at Dec. 31, 2019 | 380,668 | $ 10,603 | 344,547 | 9,433 | 16,085 |
Ending balance (in shares) at Dec. 31, 2019 | 1,192,725 | ||||
Net Income | 53,623 | 53,623 | |||
Pension adjustments, net of tax | (294) | (294) | |||
Capital investment from parent | 369 | 369 | |||
Gain(loss) on foreign currency translation, net of tax | 13,676 | 13,676 | |||
Exercise of warrants | 64,374 | $ 2,496 | 61,878 | ||
Exercise of warrants (in shares) | 306,539 | ||||
Conversion of convertible bonds | 187,095 | $ 5,825 | 181,270 | ||
Conversion of convertible bonds (in shares) | 715,258 | ||||
Ending balance at Dec. 31, 2020 | 699,511 | $ 18,924 | 588,064 | 22,815 | 69,708 |
Ending balance (in shares) at Dec. 31, 2020 | 2,214,522 | ||||
Net Income | 78,108 | 78,108 | |||
Pension adjustments, net of tax | (286) | (286) | |||
Gain(loss) on foreign currency translation, net of tax | 504 | 504 | |||
Issuance of shares in IPO | 86,041 | $ 2,274 | 83,767 | ||
Issuance of shares in IPO (in shares) | 263,150 | ||||
Ending balance at Dec. 31, 2021 | $ 863,878 | $ 21,198 | $ 671,831 | $ 23,033 | $ 147,816 |
Ending balance (in shares) at Dec. 31, 2021 | 2,477,672 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flow from operating activities: | |||
Net Income | $ 78,108 | $ 53,623 | $ 36,325 |
Adjustments to reconcile net income to net cash from operating activities: | |||
Depreciation and amortization | 17,918 | 31,574 | 33,422 |
Gain(Loss) on foreign currency remeasurement | (2,082) | 244 | (3,206) |
Deferred taxes | 5,976 | 4,422 | 2,706 |
Non-cash interest expense | 23 | 5,103 | 12,874 |
Working capital adjustments: | |||
Accounts receivable | 1,638 | (4,099) | (3,680) |
Prepaid expenses, other current and non-current assets | (2,950) | (204) | (870) |
Accounts payable, accrued expenses and other payables | (2,052) | 5,835 | (1,630) |
Contract liabilities | (168) | 609 | (112) |
Income tax payable | (2,838) | 2,689 | (1,749) |
Other current and non-current liabilities | 2,532 | 54 | 2,582 |
Net cash flows provided by operating activities | 96,105 | 99,850 | 76,662 |
Cash flow from (used in) investing activities: | |||
Acquisition of Double8 Games Co., Ltd. | 0 | (1,952) | 0 |
Acquisition of financial assets (investments) | (1,541) | 0 | 0 |
Purchases of intangible assets | (61) | (6) | 0 |
Purchases of property and equipment | (207) | (217) | (200) |
Disposals of property and equipment | 3 | 0 | 0 |
Net cash flows from (used in) investing activities | (1,806) | (2,175) | (200) |
Cash flows from (used in) financing activities: | |||
Proceeds from capital investment from parent | 0 | 0 | 5,124 |
Proceeds received from short-term borrowings | 0 | 0 | 68,631 |
Proceeds received from long-term borrowings with related parties | 0 | 0 | 17,158 |
Repayments of long-term borrowings with related party | 0 | (42,371) | 0 |
Isssuance of new shares-IPO, net of IPO cost | 86,041 | ||
Repayments of short-term senior note | 0 | (33,897) | (152,704) |
Net cash flows used in financing activities | 86,041 | (76,268) | (61,791) |
Net foreign exchange difference on cash and cash equivalents | (1,468) | (637) | (3,217) |
Net increase (decrease) in cash and cash equivalents | 178,872 | 20,770 | 11,454 |
Cash and cash equivalents at beginning of period | 63,188 | 42,418 | 30,964 |
Cash and cash equivalents at end of period | 242,060 | 63,188 | 42,418 |
Noncash financing activity: | |||
Conversion of 2.5% Convertible bonds, net of tax | 0 | 187,095 | 0 |
Conversion of 2.5% Non-convertible bonds with warrants, net of tax | 0 | 64,374 | 0 |
Interest | 0 | 5,891 | 9,779 |
Income taxes | $ 18,819 | $ 12,546 | $ 10,196 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) | 12 Months Ended |
Dec. 31, 2021 | |
Convertible debt [Member] | |
Debt conversion converted instrument rate | 2.50% |
Non-convertible debt [Member] | |
Debt conversion converted instrument rate | 2.50% |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of business | Note 1: Description of business Background and nature of operations DoubleDown Interactive Co., Ltd. (“DDI,” “we,” “us,” “our” or “the Company,” formerly known as The8Games Co., Ltd.) was incorporated in 2008 in Seoul, Korea as an interactive entertainment studio, focused on the development and publishing of casual games and mobile applications. DDI is a subsidiary of DoubleU Games Co., Ltd. (“DUG” or “DoubleU Games”), a Korean company and our controlling shareholder holding 67.1 32.9 22.3 10.6 (“DDI-US”) 825 DDI-US, We develop and publish digital gaming content on various mobile and web platforms through our multi-format interactive all-in-one Initial Public Offering On September 2, 2021, DoubleDown Interactive Co., Ltd. filed its initial public offering (the “Offering”) of 6,316,000 0.05 W 10,000 18.00 5,263,000 1,053,000 86.0 8.7 We intend to use the net proceeds from this offering for working capital and general corporate purposes, which may include potential payments that could result from resolution of pending legal proceedings. Prior to this offering, there has been no public market for our common shares or ADSs. Our ADSs trade on the NASDAQ Stock Market (“NASDAQ”) under the symbol “DDI.” Acquisition of Double8 Games Co., Ltd. (“Double8 Games”) On February 25, 2020, we completed the acquisition of Double8 Games Co., Ltd. (“Double8 Games”) from DoubleU Games in exchange for KRW2.3 billion (US$2.0 million). Double8 Games is based in Seoul, Korea, with the primary business of developing digital gaming content for international markets. The acquisition was considered a business combination among entities under common control and, therefore, the transfer of net assets was recorded at their carrying value with all financial information prior to the acquisition adjusted for comparability. Assets acquired and liabilities assumed primarily consist of working capital items, including a right of use asset and lease obligation. The difference between the cash paid and carrying value of the net assets received was recorded as a capital investment from parent. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Significant accounting policies | Note 2: Significant accounting policies Basis of preparation and consolidation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of DDI and its controlled subsidiaries. All significant intercompany transactions, balances and unrealized gains or losses have been eliminated. Use of estimates The preparation of financial statements in conformity with GAAP requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures. We regularly evaluate estimates and assumptions related to provisions for income taxes, revenue recognition, expense accruals, deferred income tax asset valuation allowances, valuation of goodwill and intangibles, and legal contingencies. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and the actual results, future operating results may be affected. Functional currency and translation of financial statements Our functional currency is the Korean Won (“KRW”) and the U.S. Dollar (“dollar,” “USD,” “US$,” or “$”) is the functional currency of our United States subsidiaries. The accompanying consolidated financial statements are presented in USD. The consolidated balance sheets have been translated at the exchange rates prevailing at each balance sheet date. The consolidated statement of comprehensive income and statement of cash flows have been translated using the weighted-average exchange rates prevailing during the periods of each statement. The equity capital is denominated in the functional currency, KRW, and is translated at historical exchange rates. All translation adjustments resulting from translating into the reporting currency are accumulated as a separate component of accumulated other comprehensive income in shareholders’ equity. Gains or losses resulting from foreign currency transactions are included in other income (expense). Intercompany monetary items denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date with the gain or loss arising on translation recorded to other income (expense). Intercompany non-monetary Cash and cash equivalents We consider all money market funds and short-term investments with a maturity of three months or less when acquired to be cash and cash equivalents. Cash and cash equivalents are held by high credit quality financial institutions and balances may exceed limits of federal insurance. We have not experienced any losses resulting from these excess deposits. Financial instruments and concentration of credit risk Financial instruments, which potentially expose us to concentrations of credit risk, consist primarily of cash and cash equivalents and accounts receivable. Accounts receivable are recorded and carried at the net invoiced amount, which is net of platform payment processing fees, unsecured, and represent amounts due to us based on contractual obligations where an executed contract exists. We do not require collateral and have not recognized an allowance as management estimates the net receivable is fully collectible. Apple, Inc. (“Apple”), Facebook, Inc. (“Facebook”), and Google, LLC (“Google”) represent significant distribution, marketing, and payment platforms for our games. A substantial portion of our revenue was generated from players who accessed our games through these platforms and a significant concentration of our accounts receivable balance is comprised of balances owed to us by these platforms. The following table summarizes the percentage of revenues and accounts receivable generated via our platform providers in excess of 10% of our total revenues and total accounts receivable: Revenue Concentration Year ended December 31, 2021 2020 2019 Apple 51.8 % 50.8 % 48.1 % Facebook 25.9 % 27.3 % 31.2 % Google 19.1 % 18.9 % 17.2 % Account Receivable Concentration as of December 31, 2021 2020 Apple 55.6 % 54.1 % Facebook 23.7 % 25.9 % Google 17.5 % 18.0 % Fair value measurements Fair value is defined as an exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The three-tiered fair value hierarchy that prioritizes the inputs based on the observability as of the measurement date is as follows: Level 1 – Observable inputs for identical assets or liabilities, such as quoted prices in active markets; Level 2 – Inputs other than quoted prices in active markets that are either directly or indirectly observable; Level 3 – Unobservable inputs in which little or no market data exists, therefore they are developed using estimates and assumptions developed by us, which reflect those that a market participant would use. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the placement of assets and liabilities being measured within the fair value hierarchy. See Note 5: Fair value measurements. Goodwill and indefinite-lived intangible assets Goodwill consists of the excess of the purchase price over the fair value of identifiable assets acquired and liabilities assumed in a business combination. Our indefinite-lived intangible assets were acquired in a business combination and recorded at fair value. We assess the carrying value of our goodwill and other indefinite-lived assets for potential impairment annually as of October 1, or more frequently if events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. When assessing goodwill for impairment, we may elect to first utilize a qualitative assessment to evaluate if a more detailed quantitative impairment test is necessary. An impairment charge is recorded based on the excess of the reporting unit’s carrying amount over its fair value. In determining fair value of our reporting unit in connection with our annual goodwill impairment test, we perform a blended analysis of the present value of future discounted cash flows and a market valuation approach. The discounted cash flows model indicates the fair value of the reporting unit based on the present value of the cash flows that we expect the reporting unit to generate in the future. The market valuation approach indicates the fair value of the business based on a comparison of the Company to comparable publicly traded firms in similar lines of business. In determining fair value of indefinite-lived intangible assets for purposes of our annual impairment test, we use the relief-from-royalty method. This method assumes that the trade name and trademarks have value to the extent that their owner is relieved of the obligation to pay royalties for the benefits received from them. The amount of impairment of indefinite-lived intangible assets is measured by the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset. We have identified a single reporting unit based on our management structure. There were no impairments of our indefinite-lived intangible assets or goodwill to date. Finite-lived intangible assets Intangible assets acquired separately are measured on initial recognition at cost. The carrying value of intangible assets acquired in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses. Finite-lived intangible assets are amortized over their useful economic life and assessed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of these assets is determined by comparing the forecasted undiscounted net cash flows from use and eventual disposition of the asset over its remaining economic life to its carrying value. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in estimates. The amortization expense on intangible assets with finite lives is recognized in the statement of income and comprehensive income in depreciation and amortization. Development costs Development costs for new app development are capitalized and recognized as an intangible asset when the preliminary development stage has been completed, management commits to funding the project, it is probable that the project will be completed, and the software will be used for its intended function. Following initial recognition of the development costs as an asset, the asset is carried at cost less any accumulated amortization and accumulated impairment losses. Amortization of the asset begins when development is complete, and the asset is available for use. It is amortized over the period of expected future benefit. Amortization is recorded in depreciation and amortization. Revenue recognition Our social and mobile apps operate on a free-to-play Once obtained, virtual currency (either free or purchased) cannot be redeemed for cash nor exchanged for anything other than gameplay within our apps. When virtual currency is played on any of our games, the game player could “win” and be awarded additional virtual currency or could “lose” and lose the future use of that virtual currency. We have concluded that our virtual currency represents consumable goods, because the game player does not receive any additional benefit from the games and is not entitled to any additional rights once the virtual currency is substantially consumed. Control transfers when the virtual currency is consumed for gameplay. We recognize revenue from player purchases of virtual currency based on the consumption of this currency. We determined through a review of play behavior that game players generally do not purchase additional virtual currency until their existing virtual currency balances, regardless of source (e.g., bonus currency, gifted currency through social media channels, daily free chips, etc.), have been substantially consumed. Based on an analysis of customers’ historical play behavior, purchase behavior, and the amount of virtual currency outstanding, we are able to estimate the rate that virtual currency is consumed during gameplay. Accordingly, revenue is recognized using a user-based revenue model with the period between purchases representing the timing difference between virtual currency purchase and consumption. This timing difference is relatively short. We continuously gather and analyze detailed customer play behavior and assess this data in relation to our judgments used for revenue recognition. We generate a small portion of our revenue from subscription services. All monthly subscription fees are prepaid and non-refundable one-month Disaggregation of revenue We believe disaggregation of our revenue based on platform and geographical location are appropriate categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. The following table represents our disaggregation of revenue between mobile and web platforms (in thousands): Year ended December 31, 2021 2020 2019 Mobile $ 264,911 $ 257,405 $ 184,755 Web 98,294 100,937 88,855 Total revenue $ 363,205 $ 358,342 $ 273,610 The following table presents our revenue disaggregated based on the geographical location of our players (in thousands): Year ended December 31, 2021 2020 2019 U.S. (1) $ 317,605 $ 309,211 $ 237,712 International 45,600 49,131 35,898 Total revenue $ 363,205 $ 358,342 $ 273,610 (1) Geographic location is presented as being derived from the U.S. when data is not available. Principal-agent considerations Our revenue contracts are with game players who are our customers. We have exclusive control over all content, pricing, and overall functionality of games accessed by players. Our games are played on various third-party platforms for which the platform providers collect proceeds from our customers and remit us an amount after deducting a fee for processing and other agency services. We record revenue at the gross amount charged to our customers and classify fees paid to platform providers (such as Apple, Facebook, and Google) within cost of revenue. Contract assets, contract liabilities and other disclosures Customer payments are based on the payment terms established in our contracts. Payments for purchase of virtual currency are required at time of purchase, are non-refundable non-cancellable The following table summarized our opening and closing balances in contract assets and contract liabilities (in thousands): Year ended 2021 2020 Contract assets (1) $ 674 $ 718 Contract liabilities 2,246 2,393 (1) Contract assets are included within prepaid expenses and other assets in our consolidated balance sheet. Cost of revenue Amounts recorded as cost of revenue relate to direct expenses incurred in order to generate social gaming revenue. Such costs are recorded as incurred, and primarily consist of fees withheld by our platform providers from the player proceeds received by the platform providers on our behalf, hosting fees, and royalties. Depreciation and amortization expense is excluded from cost of revenue and other operating expenses and is separately presented on the consolidated statement of income and comprehensive income. Defined benefit pension plan We operate a defined benefit pension plan under employment regulations in Korea. The plan services the employees located in Seoul and is a final million and million was included in other non-current and The following table summarizes the components of the projected benefit obligation (in thousands): As of December 31, As of December 31, Projected benefit obligation at beginning of year $ 2,792 $ 1,882 Service cost 759 738 Interest cost 29 30 Actuarial (gain)/loss 289 492 Benefits paid (543 ) (400 ) Other 254 (273 ) Foreign currency translation adjustment (229 ) 323 Projected benefit obligation at end of year $ 3,351 $ 2,792 The plan assets are held in a limited number of marketable and liquid financial instruments and totaled $3.4 million at December 31, 2021 and $0 as of December 31, 2020. Valuation adjustments were not material. Defined contribution plan We sponsor a defined contribution plan for our employees based in Seattle, Washington. We provide a matching contribution of 100% on the first 1% of employee contributions and 50% on the next 5% of employee contributions. Our contribution expense for the years ended December 31, 2021, 2020 and 2019 was approximately , and $394,000 respectively. Advertising costs The cost of advertising is expensed as incurred and totaled $74.2 million, million and $28.5 million for the years ended December 31, 2021, 2020 and 2019, respectively. Advertising costs primarily consist of marketing and player acquisition and retention costs and are included in sales and marketing expenses. Research and development Research and development costs relate primarily to employee costs associated with in-app internal-use Income taxes Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax bases of assets and liabilities, computed using enacted tax rates in the period in which they reverse. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” standard, no tax benefit is recorded. Statutory withholding tax is recognized in income tax expense as incurred. Segment information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, our Chief Executive Officer, in making decisions regarding resource allocation and assessing performance. We view our operations and manage our business as one operating segment. Recent accounting guidance – adopted ASU 2017-11 The Financial Accounting Standards Board (“FASB“) issued Accounting Standards Update (“ASU“) No. 2017-11, Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” in 2017 that simplifies the guidance for equity-linked financial instruments (free-standing or embedded) with down- round features that reduce the exercise price when the pricing of a future round of financing is lower. The standard was effective for us beginning January 1, 2020, with early adoption permitted. We early-adopted the standard using a full retrospective approach effective January 1, 2017. In May 2017, we Non-convertible The warrants were not considered liabilities within the scope of ASC 480. In addition, they also met both the requirements of (1) being considered indexed to the Company’s own stock and (2) the qualifications for equity classification. Therefore, the warrants were recorded within stockholders’ equity. There are no provisions pursuant to which the Company could be obligated to pay cash or other assets to settle the warrants; settlement is in shares only, and all settlement provisions contemplate payment of an amount based on the difference between the fair value and a fixed exercise price for a fixed number of shares; subject to down-round and standard anti-dilution adjustments. Due to the adoption of ASU 2017-11, On May 15, 2020, DUG exercised its call option right and simultaneously redeemed the 2.5% Non-convertible The 2.5% Convertible Bonds (and the 2.5% Non-convertible The Company evaluated the terms of the 2.5% Convertible Notes in accordance with ASC Topic No. 815 – 40, “Derivatives and Hedging - Contracts in Entity’s Own Stock” and determined that the underlying common stock is indexed to our common stock. We determined that the embedded conversion and other features did not meet the definition of a liability and therefore did not bifurcate the conversion and other features and account for it as a separate derivative liability. In addition, the 2.5% Convertible Bonds contain a contingent beneficial conversion feature that may be triggered if the conversion price is reduced upon a down-round in the future, subject to accounting under ASC 470-20-25-6. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | Note 3: Goodwill and intangible assets The majority of our intangible assets consist of assets acquired through the 2017 acquisition of DDI-US. December 31, 2021 December 31, 2020 Asset Description Useful life Gross Accum. Net Gross Accum. Net Trademarks indefinite $ 50,000 $ — $ 50,000 $ 50,000 $ — $ 50,000 Customer relationships 4 years 75,000 (75,000 ) — 75,000 (67,187 ) 7,813 Purchased technology 5 years 45,423 (41,811 ) 3,612 45,423 (33,149 ) 12,274 Development costs 3 years 9,486 (9,486 ) — 9,486 (8,434 ) 1,052 Software 4 years 2,463 (2,396 ) 67 2,406 (2,181 ) 225 Total $ 182,372 $ (128,693 ) $ 53,679 $ 182,315 $ (110,951 )$ 71,364 On January 1, 2019, we determined, based on a strategic decision to sunset certain games within our game portfolio, to change the useful life of our development costs from 5 years to 3 years. This change in estimate resulted in incremental amortization expense of $2.8 million in 2019. Amortization expense for the years ended December 31, 2021, 2020 and 2019 totaled $17.7 million, $31.3 million, and $33.1 million respectively. Estimated amortization expense for the years ending December 31, 2022 through 2026 is as follows (in thousands): Year Expense 2022 $ 3,679 2023 0 2024 0 2025 0 2026 0 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Note 4: Debt The components of debt at December 31, 2021, 2020 and 2019 are as follows (in thousands): As of December 31, 2021 2020 3.5% Senior Note due 2020 $ — $ — 4.60% Senior Notes due to related party due 2024 42,176 45,956 2.5% Convertible bonds due 2024, early redemption 2022 including accrued interest — — 2.5% Non-Convertible bonds due 2024, early redemption 2022 including accrued interest, net of warrant discount — — Total debt 42,176 45,956 Less: Short-term debt — — Total Long-term debt $ 42,176 $ 45,956 3.50% Senior Note due 2020 In May 2019, we refinanced our 4.3% Senior Note with a new credit facility (the 3.5% Senior Note) with two new lenders, with an original aggregate principal amount of KRW80 billion (US$67 million), at a lower interest rate of 3.5%. The proceeds from the 3.5% Senior Note, along with KRW20 billion (USD17 million) in additional borrowing from our 4.6% Senior Notes with related party were used to repay amounts outstanding under the 4.3 Note. The 3.50% Senior Note required quarterly interest payments at 3.50% of unpaid principal which began in August 2019. Quarterly principal repayments of KRW20 billion (US$17 million) are required. The 3.5% Senior Note was paid in full in May 2020 . 4.60% Senior Notes due to related party due 2024 The 4.60% Senior Notes due to related party, which collectively total KRW100 billion (US$84 million) at inception, accrue 4.60 Voluntary principal and interest payments were made in June and September 2020. Principal of KRW20 billion (US$17 million) and interest of KRW1.2 billion (US$1.1 million) was paid in June 2020 and principal of KRW30 billion (US$25 million) and interest of KRW3.1 billion (US$2.7 million) was paid in September 2020. Bonds 2.5% Convertible Bonds Interest on the 2.5% Convertible Bonds is payable in quarterly cash coupon payments of 0.625% of the outstanding principal. The 2.5% Convertible Bonds have a 5.0% yield-to-maturity, The 2.5% Convertible Bonds are convertible into 715,258 common shares at an initial conversion price of KRW293,600, subject to certain standard adjustments for anti-dilution protection (“conversion price adjustment”). The 2.5% Convertible Bonds also contain a provision commonly referred to as “down-round” protection, whereby, in the event of issuance of new debt with the conversion price below the 2.5% Convertible Bonds’ conversion price, or in the event of the sale of new shares at the price below the conversion price, the conversion price will be adjusted based on the magnitude of the dilution to existing shareholders. We believe the likelihood of triggering a conversion price adjustment is remote due to the control exercised by DUG and STIC and the expected operating performance of the Company. Through the conversion dates, no event triggering a conversion price adjustment or the down-round protection had occurred. At various dates in May and June 2020, STIC, as holder of the 2.5% Convertible Bonds, exercised its right to convert all outstanding bonds into 715,258 common shares. In connection with these transactions, we paid STIC the accrued coupon interest of $0.9 million and the unpaid yield-to-maturity The conversion of the 2.5% Convertible Bonds was in accordance with the original terms of the instruments and were not subject to an inducement offer to convert as the terms of the conversion were not modified. As a result, the carrying value of the 2.5% Convertible Bonds, plus the forfeited yield-to-maturity (US$5.8 million, at May 15, 2020) recorded to common shares and KRW 222.5 billion (US$181.3 million, at May 15, 2020) was recorded to additional paid-in-capital 2.5% Non-convertible As discussed further above, in May 2017, we issued aggregate principal amount KRW90 billion (US$76 million) 2.5% Non-convertible common shares at an initial conversion price of KRW293,600 per share, subject to certain standard adjustments for anti- dilution protection (“exercise price adjustment”). The warrants also contain a provision commonly referred to as “down-round” protection, whereby, in the event of issuance of new debt or sale of new shares at a price below the exercise price, the exercise price will be adjusted based on the magnitude of the dilution to existing shareholders. Interest Non-convertible Non-convertible yield-to-maturity, Non-convertible 2.5 Non-convertible The warrants may be exercised with cash, by surrendering the 2.5 Non-convertible Non-convertible 30-day On May 15, 2020, DUG exercised its call option right and simultaneously redeemed the 2.5% Non-convertible yield-to-maturity Non-convertible yield-to-maturity paid-in-capital As of December 31, 2021, maturities of short and long-term debt for the years ending December 31 are as follows (in thousands): Total 2022 2023 2024 4.60% Senior Notes to related parties due 2024 $ 42,176 — — $ 42,176 Total $ 42,176 — — $ 42,176 |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Note 5: Fair value measurements The carrying values of our accounts receivable, prepaid expenses and other current assets, accounts payable, accrued liabilities, and short- term borrowings approximate their fair values due to the short-term nature of these instruments. Our cash equivalents (Level 1 estimate) consist of money market funds and Korean market government bonds totaling $236.6 million and million, as of December 31, 2021 and 2020, respectively. We rely on credit market data to track interest rates for other entities with similar risk profiles. We record all debt at inception at fair value. We perform subsequent analysis on available data point to evaluate the fair value of our borrowing as of the balance sheet date. We rely on credit market data to track interest rates for other entities with similar risk profiles. As of December 31, 2021 and 2020, we believe the fair value of our senior notes (a Level 3 estimate) approximates carrying value due to the nature of the instruments and the lack of meaningful change to our credit profile. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 6: Income taxes Income (loss) before income tax consisted of the following (in thousands): Year ended December 31, 2021 2020 2019 US $ 97,918 $ 89,416 $ 62,706 Korea 2,696 (14,199 ) (12,839 ) Total Income before income taxes $ 100,614 $ 75,217 $ 49,867 The following table presents the detail of income tax expense for the periods presented (in thousands): Year ended December 31, 2021 2020 2019 Current: US $ 14,481 $ 15,244 $ 8,469 Korea 2,049 1,928 2,367 Total Current Taxes: $ 16,530 $ 17,172 $ 10,836 Deferred: US $ 8,154 $ 5,105 $ 5,278 Korea (2,178 ) (683 ) (2,572 ) Total Deferred Taxes $ 5,976 $ 4,422 $ 2,706 Total Income Tax Expense $ 22,506 $ 21,594 $ 13,542 The following table presents a reconciliation of the statutory rate and our effective tax rate for the periods presented: Years Ended December 31, 2021 2020 2019 Statutory Tax Rate 20.0 % 20.0 % 20.0 % Foreign Jurisdiction Rate Differential 3.5 % 3.8 % 3.4 % Non-deductible 0.0 % 1.5 % 0.0 % Withholding Taxes 2.0 % 2.3 % 4.6 % Tax Credits (4.2 ) (3.5 ) (7.3 ) Valuation Allowance 1.6 % 5.0 % 7.6 % Other (0.6 ) (0.5 ) (1.1 ) Total Tax Rate 22.3 % 28.6 % 27.2 % Year ended December 31, 2021 2020 Deferred Income Tax Assets: Net Operating Loss Carryforward $ 8,333 $ 8,206 Tax Credit Carryforward 12,615 9,529 Accruals and Reserves 1,584 1,762 Intangibles 15,643 14,158 Lease Liability 1,860 2,565 Deferred Tax Assets $ 40,035 $ 36,220 Less: Valuation Allowance (18,112 ) (17,936 ) Net Deferred Tax Assets 21,923 18,284 Deferred Tax Liabilities Goodwill $ (45,074 ) $ (35,096 ) Accrued Interest — — Right -of-use-assets (2,162 ) (2,424 ) Other (379 ) (359 ) Deferred Tax Liabilities $ (47,615 ) $ (37,879 ) Net deferred Tax Liabilities $ (25,692 ) $ (19,595 ) Realization of deferred tax assets is dependent upon the generation of future taxable income, if any, the timing, and amount of which are uncertain. We have provided a valuation allowance against certain deferred tax assets of Korea as of December 31, 2021 and 20 20 that these deferred tax assets will not be realized. As of December 31, 2021, we determined tax attributes expected to be realized prior to their expiration and recognized a deferred tax asset . As of December 31, 2021 and 2020, we have Korean tax loss carryforwards of approximately $39.2 million and $34.4 million, respectively, which are available to reduce future taxable income. These losses begin to expire in Additionally, we have Korean tax credit carryforwards of million and million as of December 31, 2021 and 20 20 We have not recorded a liability for income taxes or withholding taxes on undistributed earnings of subsidiaries as of December 31, 2021 as we intend to reinvest such earnings outside of Korea for the foreseeable future. Given the Company’s current and anticipated losses in Korea, the method of realizing the cumulative temporary differences related to foreign earnings is difficult to estimate. Therefore, the Company concluded it is not practical to estimate the related deferred tax liability. We are currently not under audit in any tax jurisdiction. We do not have any uncertain tax positions and have not established reserves for tax positions based on estimates of whether, and the extent to which, additional taxes will be due. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Note 7: Shareholders’ equity Common stock We have 200,000,000 total authorized shares at December 31, 2021 and 20 20 winding-up, |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Note 8: Net Income per share Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding for the period, without consideration for potentially dilutive securities. Diluted net income per share is computed by dividing net income by the weighted-average number of common shares and dilutive common share equivalents outstanding for the period determined using the treasury-stock and if-converted Dilutive common share equivalents are comprised of warrants and shares issuable under our convertible debt arrangement described in Note4:Debt. The following table presents the calculation of basic and diluted net income per share (in thousands except share and per share amounts): Years Ended December 31, 2021 2020 2019 Numerator: Net income applicable to common shareholders — basic $ 78,108 $ 53,623 $ 36,325 Dilutive effect of assumed conversion of convertible debt — 2,687 7,311 Net income applicable to common shareholders — diluted $ 78,108 $ 56,310 $ 43,636 Denominator: Weighted average shares outstanding — basic 2,303,200 1,807,410 1,192,725 Dilutive effect of assumed conversion of convertible debt — 295,028 715,258 Dilutive effect of assumed conversion of warrants — 46,676 87,148 Weighted average shares outstanding — diluted 2,303,200 2,149,114 1,995,131 Basic net income per share $ 33.91 $ 29.67 $ 30.46 Diluted net income per share $ 33.91 $ 26.20 $ 21.87 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2021 | |
Statement of Other Comprehensive Income [Abstract] | |
Accumulated Other Comprehensive Income | Note 9: Accumulated other comprehensive income Changes in accumulated other comprehensive income (AOCI) by component for the years ended December 31, 2021, 2020 and 2019 were as follows (in thousands): Currency Defined Total Balance at January 1, 2019 $ 389 $ (313 ) $ 76 Foreign currency translation gain/(loss) 9,742 — 9,742 Actuarial gain/(loss), net of tax — (385 ) (385 ) Balance at December 31, 2019 $ 10,131 $ (698 ) $ 9,433 Foreign currency translation gain/(loss) 13,676 — 13,676 Actuarial gain/(loss), net of tax — (294 ) (294 ) Balance as of December 31, 2020 $ 23,807 $ (992 ) $ 22,815 Foreign currency translation gain/(loss) 504 — 504 Actuarial gain/(loss), net of tax — (286 ) (286 ) Balance as of December 31, 2021 $ 24,311 (1,278 ) 23,033 For years ended December 31, 2021 , 2020 and 2019, we did not tax effect foreign currency translation gain/(loss) because we have determined such gain/(loss) is permanently reinvested and actuarial gain/(loss) is not tax effected due to a valuation allowance applied to our deferred tax assets. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | Note 10: Leases Our operating leases primarily consist of real estate leases for office space and do not have any non-lease The Seattle, Washington lease originated in July 2012 and consists of 49,375 square feet. In September 2018, the only option to extend, which was effective October 1, 2019, was exercised to extend the term for 61 months. The extended lease will expire in October 2024. The Gangnam-gu, Supplemental balance sheet and cash flow information related to operating leases is as follows: December 31, December 31, Operating lease right-of-use $ 7,764 $ 10,864 Accrued rent 934 877 Total operating lease right-of-use $ 6,830 $ 9,987 Short-term operating lease liabilities 3,076 3,033 Long-term operating lease liabilities 4,688 7,831 Total operating lease liabilities $ 7,764 $ 10,864 Cash paid for amounts included in the measurement of operating lease liabilities $ 3.3 million $ 3.2 million Maturities of lease liabilities are as follows (in thousands): As of December 31, 2021 Seattle Seoul 2022 1,987 1,353 2023 2,037 1,167 2024 1,732 — 2025 — — Thereafter — — Less: Imputed Interest (379 ) (133 ) Total $ 5,377 $ 2,387 Operating lease costs were $3.3 million , million and $3.1 million for the years ended December 31, 2021, 2020 and 2019, respectively. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Note 11: Commitments and contingencies Legal contingencies On April 12, 2018, a class-action lawsuit was filed against DDI-US In August 2018, we filed a Motion to Compel Arbitration, which was denied and immediately appealed in December 2018. We were granted a Motion to Stay pending appeal in February 2019. In October 2019, a court date was issued and subsequently abated as the Ninth Circuit Appeals court hears the oral arguments and a resolution of appeal is determined in a similar case with one of our competitors. On January 29, 2020, the Ninth Circuit affirmed the District Court’s denial of arbitration, thereby denying our appeal to compel arbitration. The case is now in District Court. On June 17, 2020, we filed a motion in the United States District Court for the Western District of Washington, which, if granted, would certify certain questions of state law to the Washington State Supreme Court for interpretation in accordance with applicable state law. On August 11, 2020, the District Court denied DDI-US’s DDI-US DDI-US DDI-US co-defendant, DDI-US dispositive motion deadline and the trial date. The court stated in its July 19, 2021 order that it would reset case management deadlines after various motions, including plaintiffs’ motion for class certification and preliminary injunction, and Double Down’s renewed motion to stay pending arbitration, have been decided. On August 19, 2021, plaintiffs filed a motion for sanctions and request for evidentiary hearing, regarding alleged spoliation of electronic documents by Double Down. Double Down disputes the allegations and has responded. The parties have filed various other motions and engaged in discovery, including depositions and expert discovery. IGT tendered its defense of the lawsuit to Double Down and sought indemnity for any damages from the lawsuit, based on various agreements associated with IGT’s sale of Double Down. Double Down had previously tendered its defense to IGT and sought indemnity from it. The parties entered into a standstill or tolling agreement, which expired on September 1, 2021, and was extended by agreement until October 1, 2021. The case is subject to significant uncertainties. In determining the likelihood of a loss and/or the measurement of any loss or range of loss, we evaluated (1) the facts and circumstances known to us, including information regarding the likelihood of a settlement and the outcome of discussions relating to indemnification by co-defendants, 450-20, million. The Company will continue to evaluate the appropriateness of the amount recorded as the litigation proceeds over time, potentially resulting in a material adjustment thereto. We have incurred and expect to continue to incur significant expense defending the Benson Benson The resolution of the Benson Benson In the future, additional legal proceedings or regulatory investigations targeting our social casino games and claiming violations of state or federal laws could also occur in other states, based on the unique and particular laws of each jurisdiction. We could, in connection with any such proceedings or regulatory actions, including as a result of the Benson settlement amounts. We cannot predict the likelihood, timing, or scope of the consequences of such an outcome, or the outcome of any other legal proceedings to which we may be a party, any of which could have a material adverse effect on our results of operations, cash flows, or financial condition. NEXRF brought suit alleging patent infringement of certain patents for gaming applications used by defendants. The defendants were served with the lawsuit on January 8, 2021. The defendants filed a motion to dismiss plaintiffs’ complaint on April 29, 2021, arguing that the asserted patents are not patent-eligible because they are drawn to an abstract idea. The defendants also filed a motion to stay discovery pending resolution of the motion to dismiss. During the pendency of the defendants’ motions, however, a federal court in Nevada issued an order invalidating the asserted patents on the basis of patent ineligibility. NEXRF has appealed this ruling to the Federal Circuit. The parties agreed to stay the litigation pending the outcome of NEXRF’s appeal of the Nevada decision. The case is now stayed, effective September 3, 2021. The case is subject to significant uncertainties and, therefore, determining the likelihood of a loss and/or the measurement of any loss or range of loss cannot be reasonably estimated. Publishing and license agreements DoubleU Games We entered into the DoubleU Games License Agreement on March 7, 2018, and it was subsequently amended on July 1, 2019 and November 27, 2019. Pursuant to the DoubleU Games License Agreement, DoubleU Games grants us an exclusive license to develop and distribute certain DoubleU Games social casino game titles and sequels thereto in the social online game field of use. We are obligated to pay a royalty license fee to DoubleU Games in connection with these rights, with certain customary terms and conditions. The agreement remains in effect until either DUG no longer holds an interest, directly or indirectly, in DDI, or DDI no longer holds an interest, directly or indirectly, in DDI-US. International Gaming Technologies (“IGT”) In 2017, we entered into a Game Development, Distribution, and Services Agreement with IGT. Under the terms of the agreement, IGT will deliver game assets so that the we can port (a process of converting the assets into functioning slot games by platform) the technology for inclusion in our gaming apps. The agreement includes game assets that are used to create new games. Under the agreement, we paid IGT an initial royalty rate of 10% of revenue for their proprietary assets and 15% of revenue for third-party game asset types. Effective January 1, 2019, we amended the agreement to revise the royalty rate for proprietary game asset types to 7.5% of revenue. The initial term of the agreement is ten (10) years with up to two additional five-year periods. Costs incurred in connection with this agreement for the years ended December 31, 2021 and 2020 totaled $11.1 million and $13.5 million, respectively, and are recognized as a component of cost of revenue. |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related party transactions | Note 12: Related party transactions Our related party transactions comprise of expenses for use of intellectual property, borrowings, and sublease previously described. We may also incur other expenses with related parties in the ordinary course of business, which are included in the consolidated financial statements. The following is a summary of expenses charged by our parent, DoubleU Games (in thousands): Years ended December 31, Statement of Income and Comprehensive Income Line Item 2021 2020 2019 Royalty expense (see Note 11) $ 4,335 $ 3,015 $ 4,597 Cost of revenue Interest expense (see Note 4) 2,010 3,106 3,778 Interest expense Rent expense (see Note 10) 1,397 1,461 1,378 General and administrative expense Other expense 206 155 131 General and administrative expense Amounts due to our parent, DoubleU Games, are as follows (in thousands): Years Statement of Consolidated Balance Sheet Line Item 2021 2020 4.6% Senior Notes with $ 42,176 $ 45,956 Long-Term borrowing with related party Royalties and other expenses 511 3,631 A/P and accrued expenses Short-term lease liability 1,309 1,399 Short-term operating lease liabilities Accrued interest on 4.6% 6,454 4,918 Other non-current Long-term lease liability 1,078 2,454 Long-term lease liabilities |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of preparation and consolidation | Basis of preparation and consolidation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of DDI and its controlled subsidiaries. All significant intercompany transactions, balances and unrealized gains or losses have been eliminated. |
Use of estimates | Use of estimates The preparation of financial statements in conformity with GAAP requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures. We regularly evaluate estimates and assumptions related to provisions for income taxes, revenue recognition, expense accruals, deferred income tax asset valuation allowances, valuation of goodwill and intangibles, and legal contingencies. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and the actual results, future operating results may be affected. |
Functional currency and translation of financial statements | Functional currency and translation of financial statements Our functional currency is the Korean Won (“KRW”) and the U.S. Dollar (“dollar,” “USD,” “US$,” or “$”) is the functional currency of our United States subsidiaries. The accompanying consolidated financial statements are presented in USD. The consolidated balance sheets have been translated at the exchange rates prevailing at each balance sheet date. The consolidated statement of comprehensive income and statement of cash flows have been translated using the weighted-average exchange rates prevailing during the periods of each statement. The equity capital is denominated in the functional currency, KRW, and is translated at historical exchange rates. All translation adjustments resulting from translating into the reporting currency are accumulated as a separate component of accumulated other comprehensive income in shareholders’ equity. Gains or losses resulting from foreign currency transactions are included in other income (expense). Intercompany monetary items denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date with the gain or loss arising on translation recorded to other income (expense). Intercompany non-monetary |
Cash and cash equivalents | Cash and cash equivalents We consider all money market funds and short-term investments with a maturity of three months or less when acquired to be cash and cash equivalents. Cash and cash equivalents are held by high credit quality financial institutions and balances may exceed limits of federal insurance. We have not experienced any losses resulting from these excess deposits. |
Financial instruments and concentration of credit risk | Financial instruments and concentration of credit risk Financial instruments, which potentially expose us to concentrations of credit risk, consist primarily of cash and cash equivalents and accounts receivable. Accounts receivable are recorded and carried at the net invoiced amount, which is net of platform payment processing fees, unsecured, and represent amounts due to us based on contractual obligations where an executed contract exists. We do not require collateral and have not recognized an allowance as management estimates the net receivable is fully collectible. Apple, Inc. (“Apple”), Facebook, Inc. (“Facebook”), and Google, LLC (“Google”) represent significant distribution, marketing, and payment platforms for our games. A substantial portion of our revenue was generated from players who accessed our games through these platforms and a significant concentration of our accounts receivable balance is comprised of balances owed to us by these platforms. The following table summarizes the percentage of revenues and accounts receivable generated via our platform providers in excess of 10% of our total revenues and total accounts receivable: Revenue Concentration Year ended December 31, 2021 2020 2019 Apple 51.8 % 50.8 % 48.1 % Facebook 25.9 % 27.3 % 31.2 % Google 19.1 % 18.9 % 17.2 % Account Receivable Concentration as of December 31, 2021 2020 Apple 55.6 % 54.1 % Facebook 23.7 % 25.9 % Google 17.5 % 18.0 % |
Fair value measurements | Fair value measurements Fair value is defined as an exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The three-tiered fair value hierarchy that prioritizes the inputs based on the observability as of the measurement date is as follows: Level 1 – Observable inputs for identical assets or liabilities, such as quoted prices in active markets; Level 2 – Inputs other than quoted prices in active markets that are either directly or indirectly observable; Level 3 – Unobservable inputs in which little or no market data exists, therefore they are developed using estimates and assumptions developed by us, which reflect those that a market participant would use. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the placement of assets and liabilities being measured within the fair value hierarchy. See Note 5: Fair value measurements. |
Goodwill and indefinite-lived intangible assets | Goodwill and indefinite-lived intangible assets Goodwill consists of the excess of the purchase price over the fair value of identifiable assets acquired and liabilities assumed in a business combination. Our indefinite-lived intangible assets were acquired in a business combination and recorded at fair value. We assess the carrying value of our goodwill and other indefinite-lived assets for potential impairment annually as of October 1, or more frequently if events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. When assessing goodwill for impairment, we may elect to first utilize a qualitative assessment to evaluate if a more detailed quantitative impairment test is necessary. An impairment charge is recorded based on the excess of the reporting unit’s carrying amount over its fair value. In determining fair value of our reporting unit in connection with our annual goodwill impairment test, we perform a blended analysis of the present value of future discounted cash flows and a market valuation approach. The discounted cash flows model indicates the fair value of the reporting unit based on the present value of the cash flows that we expect the reporting unit to generate in the future. The market valuation approach indicates the fair value of the business based on a comparison of the Company to comparable publicly traded firms in similar lines of business. In determining fair value of indefinite-lived intangible assets for purposes of our annual impairment test, we use the relief-from-royalty method. This method assumes that the trade name and trademarks have value to the extent that their owner is relieved of the obligation to pay royalties for the benefits received from them. The amount of impairment of indefinite-lived intangible assets is measured by the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset. We have identified a single reporting unit based on our management structure. There were no impairments of our indefinite-lived intangible assets or goodwill to date. |
Finite-lived intangible assets | Finite-lived intangible assets Intangible assets acquired separately are measured on initial recognition at cost. The carrying value of intangible assets acquired in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses. Finite-lived intangible assets are amortized over their useful economic life and assessed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of these assets is determined by comparing the forecasted undiscounted net cash flows from use and eventual disposition of the asset over its remaining economic life to its carrying value. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in estimates. The amortization expense on intangible assets with finite lives is recognized in the statement of income and comprehensive income in depreciation and amortization. |
Development costs | Development costs Development costs for new app development are capitalized and recognized as an intangible asset when the preliminary development stage has been completed, management commits to funding the project, it is probable that the project will be completed, and the software will be used for its intended function. Following initial recognition of the development costs as an asset, the asset is carried at cost less any accumulated amortization and accumulated impairment losses. Amortization of the asset begins when development is complete, and the asset is available for use. It is amortized over the period of expected future benefit. Amortization is recorded in depreciation and amortization. |
Revenue recognition | Revenue recognition Our social and mobile apps operate on a free-to-play Once obtained, virtual currency (either free or purchased) cannot be redeemed for cash nor exchanged for anything other than gameplay within our apps. When virtual currency is played on any of our games, the game player could “win” and be awarded additional virtual currency or could “lose” and lose the future use of that virtual currency. We have concluded that our virtual currency represents consumable goods, because the game player does not receive any additional benefit from the games and is not entitled to any additional rights once the virtual currency is substantially consumed. Control transfers when the virtual currency is consumed for gameplay. We recognize revenue from player purchases of virtual currency based on the consumption of this currency. We determined through a review of play behavior that game players generally do not purchase additional virtual currency until their existing virtual currency balances, regardless of source (e.g., bonus currency, gifted currency through social media channels, daily free chips, etc.), have been substantially consumed. Based on an analysis of customers’ historical play behavior, purchase behavior, and the amount of virtual currency outstanding, we are able to estimate the rate that virtual currency is consumed during gameplay. Accordingly, revenue is recognized using a user-based revenue model with the period between purchases representing the timing difference between virtual currency purchase and consumption. This timing difference is relatively short. We continuously gather and analyze detailed customer play behavior and assess this data in relation to our judgments used for revenue recognition. We generate a small portion of our revenue from subscription services. All monthly subscription fees are prepaid and non-refundable one-month Disaggregation of revenue We believe disaggregation of our revenue based on platform and geographical location are appropriate categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. The following table represents our disaggregation of revenue between mobile and web platforms (in thousands): Year ended December 31, 2021 2020 2019 Mobile $ 264,911 $ 257,405 $ 184,755 Web 98,294 100,937 88,855 Total revenue $ 363,205 $ 358,342 $ 273,610 The following table presents our revenue disaggregated based on the geographical location of our players (in thousands): Year ended December 31, 2021 2020 2019 U.S. (1) $ 317,605 $ 309,211 $ 237,712 International 45,600 49,131 35,898 Total revenue $ 363,205 $ 358,342 $ 273,610 (1) Geographic location is presented as being derived from the U.S. when data is not available. Principal-agent considerations Our revenue contracts are with game players who are our customers. We have exclusive control over all content, pricing, and overall functionality of games accessed by players. Our games are played on various third-party platforms for which the platform providers collect proceeds from our customers and remit us an amount after deducting a fee for processing and other agency services. We record revenue at the gross amount charged to our customers and classify fees paid to platform providers (such as Apple, Facebook, and Google) within cost of revenue. Contract assets, contract liabilities and other disclosures Customer payments are based on the payment terms established in our contracts. Payments for purchase of virtual currency are required at time of purchase, are non-refundable non-cancellable The following table summarized our opening and closing balances in contract assets and contract liabilities (in thousands): Year ended 2021 2020 Contract assets (1) $ 674 $ 718 Contract liabilities 2,246 2,393 (1) Contract assets are included within prepaid expenses and other assets in our consolidated balance sheet. |
Cost of revenue | Cost of revenue Amounts recorded as cost of revenue relate to direct expenses incurred in order to generate social gaming revenue. Such costs are recorded as incurred, and primarily consist of fees withheld by our platform providers from the player proceeds received by the platform providers on our behalf, hosting fees, and royalties. Depreciation and amortization expense is excluded from cost of revenue and other operating expenses and is separately presented on the consolidated statement of income and comprehensive income. |
Defined benefit pension plan | Defined benefit pension plan We operate a defined benefit pension plan under employment regulations in Korea. The plan services the employees located in Seoul and is a final million and million was included in other non-current and The following table summarizes the components of the projected benefit obligation (in thousands): As of December 31, As of December 31, Projected benefit obligation at beginning of year $ 2,792 $ 1,882 Service cost 759 738 Interest cost 29 30 Actuarial (gain)/loss 289 492 Benefits paid (543 ) (400 ) Other 254 (273 ) Foreign currency translation adjustment (229 ) 323 Projected benefit obligation at end of year $ 3,351 $ 2,792 The plan assets are held in a limited number of marketable and liquid financial instruments and totaled $3.4 million at December 31, 2021 and $0 as of December 31, 2020. Valuation adjustments were not material. |
Defined contribution plan | Defined contribution plan We sponsor a defined contribution plan for our employees based in Seattle, Washington. We provide a matching contribution of 100% on the first 1% of employee contributions and 50% on the next 5% of employee contributions. Our contribution expense for the years ended December 31, 2021, 2020 and 2019 was approximately , and $394,000 respectively. |
Advertising costs | Advertising costs The cost of advertising is expensed as incurred and totaled $74.2 million, million and $28.5 million for the years ended December 31, 2021, 2020 and 2019, respectively. Advertising costs primarily consist of marketing and player acquisition and retention costs and are included in sales and marketing expenses. |
Research and development | Research and development Research and development costs relate primarily to employee costs associated with in-app internal-use |
Income taxes | Income taxes Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax bases of assets and liabilities, computed using enacted tax rates in the period in which they reverse. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” standard, no tax benefit is recorded. Statutory withholding tax is recognized in income tax expense as incurred. |
Segment information | Segment information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, our Chief Executive Officer, in making decisions regarding resource allocation and assessing performance. We view our operations and manage our business as one operating segment. |
Recent accounting guidance – adopted | Recent accounting guidance – adopted ASU 2017-11 The Financial Accounting Standards Board (“FASB“) issued Accounting Standards Update (“ASU“) No. 2017-11, Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” in 2017 that simplifies the guidance for equity-linked financial instruments (free-standing or embedded) with down- round features that reduce the exercise price when the pricing of a future round of financing is lower. The standard was effective for us beginning January 1, 2020, with early adoption permitted. We early-adopted the standard using a full retrospective approach effective January 1, 2017. In May 2017, we Non-convertible The warrants were not considered liabilities within the scope of ASC 480. In addition, they also met both the requirements of (1) being considered indexed to the Company’s own stock and (2) the qualifications for equity classification. Therefore, the warrants were recorded within stockholders’ equity. There are no provisions pursuant to which the Company could be obligated to pay cash or other assets to settle the warrants; settlement is in shares only, and all settlement provisions contemplate payment of an amount based on the difference between the fair value and a fixed exercise price for a fixed number of shares; subject to down-round and standard anti-dilution adjustments. Due to the adoption of ASU 2017-11, On May 15, 2020, DUG exercised its call option right and simultaneously redeemed the 2.5% Non-convertible The 2.5% Convertible Bonds (and the 2.5% Non-convertible The Company evaluated the terms of the 2.5% Convertible Notes in accordance with ASC Topic No. 815 – 40, “Derivatives and Hedging - Contracts in Entity’s Own Stock” and determined that the underlying common stock is indexed to our common stock. We determined that the embedded conversion and other features did not meet the definition of a liability and therefore did not bifurcate the conversion and other features and account for it as a separate derivative liability. In addition, the 2.5% Convertible Bonds contain a contingent beneficial conversion feature that may be triggered if the conversion price is reduced upon a down-round in the future, subject to accounting under ASC 470-20-25-6. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of percentage of revenues | The following table summarizes the percentage of revenues and accounts receivable generated via our platform providers in excess of 10% of our total revenues and total accounts receivable: Revenue Concentration Year ended December 31, 2021 2020 2019 Apple 51.8 % 50.8 % 48.1 % Facebook 25.9 % 27.3 % 31.2 % Google 19.1 % 18.9 % 17.2 % Account Receivable Concentration as of December 31, 2021 2020 Apple 55.6 % 54.1 % Facebook 23.7 % 25.9 % Google 17.5 % 18.0 % |
Summary of disaggregation of revenue | The following table represents our disaggregation of revenue between mobile and web platforms (in thousands): Year ended December 31, 2021 2020 2019 Mobile $ 264,911 $ 257,405 $ 184,755 Web 98,294 100,937 88,855 Total revenue $ 363,205 $ 358,342 $ 273,610 The following table presents our revenue disaggregated based on the geographical location of our players (in thousands): Year ended December 31, 2021 2020 2019 U.S. (1) $ 317,605 $ 309,211 $ 237,712 International 45,600 49,131 35,898 Total revenue $ 363,205 $ 358,342 $ 273,610 |
Summary of contract assets and contract liabilities | The following table summarized our opening and closing balances in contract assets and contract liabilities (in thousands): Year ended 2021 2020 Contract assets (1) $ 674 $ 718 Contract liabilities 2,246 2,393 |
Summary of projected benefit obligation | The following table summarizes the components of the projected benefit obligation (in thousands): As of December 31, As of December 31, Projected benefit obligation at beginning of year $ 2,792 $ 1,882 Service cost 759 738 Interest cost 29 30 Actuarial (gain)/loss 289 492 Benefits paid (543 ) (400 ) Other 254 (273 ) Foreign currency translation adjustment (229 ) 323 Projected benefit obligation at end of year $ 3,351 $ 2,792 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of intangible assets | There were no changes to the carrying value of goodwill during the years 2019-2021. The components of our other intangible assets were as follows (in thousands): December 31, 2021 December 31, 2020 Asset Description Useful life Gross Accum. Net Gross Accum. Net Trademarks indefinite $ 50,000 $ — $ 50,000 $ 50,000 $ — $ 50,000 Customer relationships 4 years 75,000 (75,000 ) — 75,000 (67,187 ) 7,813 Purchased technology 5 years 45,423 (41,811 ) 3,612 45,423 (33,149 ) 12,274 Development costs 3 years 9,486 (9,486 ) — 9,486 (8,434 ) 1,052 Software 4 years 2,463 (2,396 ) 67 2,406 (2,181 ) 225 Total $ 182,372 $ (128,693 ) $ 53,679 $ 182,315 $ (110,951 )$ 71,364 |
Summary of estimated amortization expense | Estimated amortization expense for the years ending December 31, 2022 through 2026 is as follows (in thousands): Year Expense 2022 $ 3,679 2023 0 2024 0 2025 0 2026 0 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Summary of long-term debt instruments | The components of debt at December 31, 2021, 2020 and 2019 are as follows (in thousands): As of December 31, 2021 2020 3.5% Senior Note due 2020 $ — $ — 4.60% Senior Notes due to related party due 2024 42,176 45,956 2.5% Convertible bonds due 2024, early redemption 2022 including accrued interest — — 2.5% Non-Convertible bonds due 2024, early redemption 2022 including accrued interest, net of warrant discount — — Total debt 42,176 45,956 Less: Short-term debt — — Total Long-term debt $ 42,176 $ 45,956 |
Summary of maturities of long-term debt | As of December 31, 2021, maturities of short and long-term debt for the years ending December 31 are as follows (in thousands): Total 2022 2023 2024 4.60% Senior Notes to related parties due 2024 $ 42,176 — — $ 42,176 Total $ 42,176 — — $ 42,176 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Summary of Income (Loss) Before Income Tax | Income (loss) before income tax consisted of the following (in thousands): Year ended December 31, 2021 2020 2019 US $ 97,918 $ 89,416 $ 62,706 Korea 2,696 (14,199 ) (12,839 ) Total Income before income taxes $ 100,614 $ 75,217 $ 49,867 |
Summary of the Detail of Income Tax Expense for the Periods | The following table presents the detail of income tax expense for the periods presented (in thousands): Year ended December 31, 2021 2020 2019 Current: US $ 14,481 $ 15,244 $ 8,469 Korea 2,049 1,928 2,367 Total Current Taxes: $ 16,530 $ 17,172 $ 10,836 Deferred: US $ 8,154 $ 5,105 $ 5,278 Korea (2,178 ) (683 ) (2,572 ) Total Deferred Taxes $ 5,976 $ 4,422 $ 2,706 Total Income Tax Expense $ 22,506 $ 21,594 $ 13,542 |
Summary of Reconciliation of the Statutory Rate and Our Effective Tax Rate for the Periods | The following table presents a reconciliation of the statutory rate and our effective tax rate for the periods presented: Years Ended December 31, 2021 2020 2019 Statutory Tax Rate 20.0 % 20.0 % 20.0 % Foreign Jurisdiction Rate Differential 3.5 % 3.8 % 3.4 % Non-deductible 0.0 % 1.5 % 0.0 % Withholding Taxes 2.0 % 2.3 % 4.6 % Tax Credits (4.2 ) (3.5 ) (7.3 ) Valuation Allowance 1.6 % 5.0 % 7.6 % Other (0.6 ) (0.5 ) (1.1 ) Total Tax Rate 22.3 % 28.6 % 27.2 % |
Summary of Deferred Tax Assets and Liabilities as of the Dates | The following table presents the significant components of our deferred tax assets and liabilities as of the dates presented (in thousands): Year ended December 31, 2021 2020 Deferred Income Tax Assets: Net Operating Loss Carryforward $ 8,333 $ 8,206 Tax Credit Carryforward 12,615 9,529 Accruals and Reserves 1,584 1,762 Intangibles 15,643 14,158 Lease Liability 1,860 2,565 Deferred Tax Assets $ 40,035 $ 36,220 Less: Valuation Allowance (18,112 ) (17,936 ) Net Deferred Tax Assets 21,923 18,284 Deferred Tax Liabilities Goodwill $ (45,074 ) $ (35,096 ) Accrued Interest — — Right -of-use-assets (2,162 ) (2,424 ) Other (379 ) (359 ) Deferred Tax Liabilities $ (47,615 ) $ (37,879 ) Net deferred Tax Liabilities $ (25,692 ) $ (19,595 ) |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Summary of the Calculation of Basic and Diluted Net Income Per Share | The following table presents the calculation of basic and diluted net income per share (in thousands except share and per share amounts): Years Ended December 31, 2021 2020 2019 Numerator: Net income applicable to common shareholders — basic $ 78,108 $ 53,623 $ 36,325 Dilutive effect of assumed conversion of convertible debt — 2,687 7,311 Net income applicable to common shareholders — diluted $ 78,108 $ 56,310 $ 43,636 Denominator: Weighted average shares outstanding — basic 2,303,200 1,807,410 1,192,725 Dilutive effect of assumed conversion of convertible debt — 295,028 715,258 Dilutive effect of assumed conversion of warrants — 46,676 87,148 Weighted average shares outstanding — diluted 2,303,200 2,149,114 1,995,131 Basic net income per share $ 33.91 $ 29.67 $ 30.46 Diluted net income per share $ 33.91 $ 26.20 $ 21.87 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Statement of Other Comprehensive Income [Abstract] | |
Summary of Accumulated Other Comprehensive Income (Loss) | Changes in accumulated other comprehensive income (AOCI) by component for the years ended December 31, 2021, 2020 and 2019 were as follows (in thousands): Currency Defined Total Balance at January 1, 2019 $ 389 $ (313 ) $ 76 Foreign currency translation gain/(loss) 9,742 — 9,742 Actuarial gain/(loss), net of tax — (385 ) (385 ) Balance at December 31, 2019 $ 10,131 $ (698 ) $ 9,433 Foreign currency translation gain/(loss) 13,676 — 13,676 Actuarial gain/(loss), net of tax — (294 ) (294 ) Balance as of December 31, 2020 $ 23,807 $ (992 ) $ 22,815 Foreign currency translation gain/(loss) 504 — 504 Actuarial gain/(loss), net of tax — (286 ) (286 ) Balance as of December 31, 2021 $ 24,311 (1,278 ) 23,033 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Summary of Cash Flow Information Related to Operating Leases | Supplemental balance sheet and cash flow information related to operating leases is as follows: December 31, December 31, Operating lease right-of-use $ 7,764 $ 10,864 Accrued rent 934 877 Total operating lease right-of-use $ 6,830 $ 9,987 Short-term operating lease liabilities 3,076 3,033 Long-term operating lease liabilities 4,688 7,831 Total operating lease liabilities $ 7,764 $ 10,864 Cash paid for amounts included in the measurement of operating lease liabilities $ 3.3 million $ 3.2 million |
Summary of Maturities of Lease Liabilities | Maturities of lease liabilities are as follows (in thousands): As of December 31, 2021 Seattle Seoul 2022 1,987 1,353 2023 2,037 1,167 2024 1,732 — 2025 — — Thereafter — — Less: Imputed Interest (379 ) (133 ) Total $ 5,377 $ 2,387 |
Related party transactions (Tab
Related party transactions (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Summary of Expenses Charged by Our Parent | The following is a summary of expenses charged by our parent, DoubleU Games (in thousands): Years ended December 31, Statement of Income and Comprehensive Income Line Item 2021 2020 2019 Royalty expense (see Note 11) $ 4,335 $ 3,015 $ 4,597 Cost of revenue Interest expense (see Note 4) 2,010 3,106 3,778 Interest expense Rent expense (see Note 10) 1,397 1,461 1,378 General and administrative expense Other expense 206 155 131 General and administrative expense |
Summary of Amounts Due to our Parent | Amounts due to our parent, DoubleU Games, are as follows (in thousands): Years Statement of Consolidated Balance Sheet Line Item 2021 2020 4.6% Senior Notes with $ 42,176 $ 45,956 Long-Term borrowing with related party Royalties and other expenses 511 3,631 A/P and accrued expenses Short-term lease liability 1,309 1,399 Short-term operating lease liabilities Accrued interest on 4.6% 6,454 4,918 Other non-current Long-term lease liability 1,078 2,454 Long-term lease liabilities |
Description of Business - Addit
Description of Business - Additional Information (Details) $ / shares in Units, $ in Thousands | Sep. 02, 2021USD ($) | Feb. 25, 2020USD ($) | Feb. 25, 2020KRW (₩) | Dec. 31, 2021USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2021KRW (₩)shares | Sep. 02, 2021KRW (₩)shares | Sep. 02, 2021$ / shares | Dec. 31, 2020KRW (₩)shares |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Business combination consideration transferred | $ | $ 825,000 | ||||||||
Common stock, shares Issued | shares | 2,477,672 | 2,477,672 | |||||||
Sale Of American Depositary Shares | shares | 5,263,000 | ||||||||
Proceeds from issuance initial public offering | $ | $ 86,041 | ||||||||
Common Stock, Value, Outstanding | ₩ | ₩ 10,000 | ₩ 10,000 | |||||||
American Depositary Shares [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Entity listing depository receipt ratio | 0.05 | ||||||||
Common Stock, Value, Outstanding | ₩ | ₩ 10,000 | ||||||||
IPO [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Proceeds from issuance initial public offering | $ | $ 86,000 | ||||||||
Payments for underwriting expense | $ | $ 8,700 | ||||||||
IPO [Member] | American Depositary Shares [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Common stock, shares Issued | shares | 6,316,000 | ||||||||
Sale of Stock, Price Per Share | $ / shares | $ 18 | ||||||||
Double8 Games Co., Ltd.[Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Business combination consideration transferred | $ 2,000 | ₩ 2,300,000,000 | |||||||
DoubleU Games Co., Ltd.[Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Equity interest percentage | 67.10% | ||||||||
STIC Special Situation Private Equity Fund [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Minority interest ownership percentage | 32.90% | ||||||||
Sale Of American Depositary Shares | shares | 1,053,000 | ||||||||
International Gaming Technologies [Member] | IPO [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Minority interest ownership percentage | 10.60% | ||||||||
Stic [Member] | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Minority interest ownership percentage | 22.30% |
Significant Accounting Polici_4
Significant Accounting Policies - Summary of Percentage of Revenues (Details) - Customer Concentration Risk [Member] | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue Concentration | Apple | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 51.80% | 50.80% | 48.10% |
Revenue Concentration | Facebook | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 25.90% | 27.30% | 31.20% |
Revenue Concentration | Google | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 19.10% | 18.90% | 17.20% |
Account Receivable Concentration | Apple | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 55.60% | 54.10% | |
Account Receivable Concentration | Facebook | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 23.70% | 25.90% | |
Account Receivable Concentration | Google | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 17.50% | 18.00% |
Significant Accounting Polici_5
Significant Accounting Policies - Summary of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 363,205 | $ 358,342 | $ 273,610 | |
US | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | [1] | 317,605 | 309,211 | 237,712 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 45,600 | 49,131 | 35,898 | |
Mobile | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 264,911 | 257,405 | 184,755 | |
Web | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 98,294 | $ 100,937 | $ 88,855 | |
[1] | Geographic location is presented as being derived from the U.S. when data is not available |
Significant Accounting Polici_6
Significant Accounting Policies - Summary of Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Contract With Customer Asset And Liability [Line Items] | |||
Contract liabilities | $ 2,246 | $ 2,393 | |
Prepaid expenses and other assets | |||
Contract With Customer Asset And Liability [Line Items] | |||
Contract assets | [1] | $ 674 | $ 718 |
[1] | Contract assets are included within prepaid expenses and other assets in our consolidated balance sheet. |
Significant Accounting Polici_7
Significant Accounting Policies - Summary of Projected Benefit Obligation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Projected benefit obligation at beginning of year | $ 2,792 | $ 1,882 |
Service cost | 759 | 738 |
Interest cost | 29 | 30 |
Actuarial (gain)/loss | 289 | 492 |
Benefits paid | (543) | (400) |
Other | 254 | (273) |
Foreign currency translation adjustment | (229) | 323 |
Projected benefit obligation at end of year | $ 3,351 | $ 2,792 |
Significant Accounting Polici_8
Significant Accounting Policies - Additional Information (Details) ₩ / shares in Units, $ / shares in Units, ₩ in Billions | May 15, 2020shares | May 31, 2017USD ($)$ / sharesshares | Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | May 31, 2017KRW (₩)₩ / shares |
Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment of indefinite-lived intangible assets | $ 0 | |||||
Impairment of goodwill | 0 | |||||
Defined contribution expense | 289,000 | $ 467,000 | $ 394,000 | |||
Advertising Expense | $ 74,200,000 | 61,800,000 | $ 28,500,000 | |||
Number of operating segments | segment | 1 | |||||
Defined Benefit Plan, Funded (Unfunded) Status of Plan | $ 3,400,000 | 2,800,000 | ||||
Marketable [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Plan assets held | 3,400,000 | 0 | ||||
Liquid Financial Instruments [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Plan assets held | $ 3,400,000 | $ 0 | ||||
2.5% Convertible bonds due 2024 [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Debt instrument face amount | $ 177,000,000 | ₩ 210 | ||||
Debt instrument, interest rate, stated percentage | 2.50% | 2.50% | ||||
Debt conversion shares issued | shares | 715,258 | |||||
2.5% Non convertible bonds due 2024 [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Debt instrument face amount | $ 76,000,000 | ₩ 90 | ||||
Debt instrument, interest rate, stated percentage | 2.50% | 2.50% | ||||
Debt conversion shares issued | shares | 306,539 | 306,540 | ||||
Debt instrument conversion price per share | (per share) | $ 270 | ₩ 293,600 | ||||
Employee contributions percentage one [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Defined contribution plan matching contribution percent | 1.00% | |||||
Employee contributions percentage two [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Defined contribution plan matching contribution percent | 5.00% | |||||
On the one percentage of employee contributions [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Defined contribution plan matching contribution percent of match | 100.00% | |||||
On the next five percentage of employee contributions [Member] | ||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||
Defined contribution plan matching contribution percent of match | 50.00% |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $ 182,372 | $ 182,315 |
Accumulated Amortization | (128,693) | (110,951) |
Net Amount | $ 53,679 | 71,364 |
Trademarks [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | indefinite | |
Gross amount | $ 50,000 | 50,000 |
Net Amount | $ 50,000 | 50,000 |
Customer relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 4 years | |
Gross amount | $ 75,000 | 75,000 |
Accumulated Amortization | (75,000) | (67,187) |
Net Amount | $ 0 | 7,813 |
Purchased technology [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 5 years | |
Gross amount | $ 45,423 | 45,423 |
Accumulated Amortization | (41,811) | (33,149) |
Net Amount | $ 3,612 | 12,274 |
Development costs [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 3 years | |
Gross amount | $ 9,486 | 9,486 |
Accumulated Amortization | (9,486) | (8,434) |
Net Amount | $ 0 | 1,052 |
Software [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 4 years | |
Gross amount | $ 2,463 | 2,406 |
Accumulated Amortization | (2,396) | (2,181) |
Net Amount | $ 67 | $ 225 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | Jan. 01, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Indefinite-lived Intangible Assets [Line Items] | ||||
Amortization of Intangible Assets | $ 17.7 | $ 31.3 | $ 33.1 | |
Maximum [Member] | ||||
Indefinite-lived Intangible Assets [Line Items] | ||||
Amortization of Intangible Assets | $ 2.8 | |||
Finite-Lived Intangible Asset, Useful Life | 5 years | |||
Minimum [Member] | ||||
Indefinite-lived Intangible Assets [Line Items] | ||||
Finite-Lived Intangible Asset, Useful Life | 3 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Summary of Estimated Amortization Expense (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2022 | $ 3,679 |
2023 | 0 |
2024 | 0 |
2025 | 0 |
2026 | $ 0 |
Debt - Summary of Debt (Details
Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 42,176 | $ 45,956 |
Less: Short-term debt | 0 | |
Total Long-term debt | 42,176 | 45,956 |
4.6% senior notes due to related parties in 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 42,176 | $ 45,956 |
Debt - Additional Information (
Debt - Additional Information (Details) ₩ / shares in Units, $ in Thousands, ₩ in Billions | May 15, 2020USD ($)shares | May 15, 2020KRW (₩)shares | Aug. 01, 2019 | Sep. 30, 2020USD ($) | Sep. 30, 2020KRW (₩) | Jun. 30, 2020USD ($) | Jun. 30, 2020KRW (₩) | Aug. 31, 2019USD ($) | Aug. 31, 2019KRW (₩) | May 31, 2019USD ($) | May 31, 2019KRW (₩) | Jun. 30, 2020shares | Dec. 31, 2021USD ($)shares | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2021₩ / shares | Jan. 01, 2021USD ($) | Jan. 01, 2021KRW (₩) | May 31, 2019KRW (₩) | Dec. 31, 2017 | May 31, 2017USD ($)shares | May 31, 2017KRW (₩)₩ / sharesshares |
Debt Instrument [Line Items] | ||||||||||||||||||||||
Repayment of related party debt | $ 0 | $ 42,371 | $ 0 | |||||||||||||||||||
Debt instrument converted into equity amount stock value | $ 187,095 | |||||||||||||||||||||
2.5% Convertible bonds due 2024 [Member] | Stic [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Debt instrument conversion price per share | ₩ / shares | ₩ 293,600 | |||||||||||||||||||||
Class of warrants or rights conversion price per share | ₩ / shares | ₩ 293,600 | |||||||||||||||||||||
Long term debt instrument maturity date | May 26, 2024 | |||||||||||||||||||||
Coupon interest payable quarterly percentage | 0.90% | 0.90% | 0.90% | 0.625% | ||||||||||||||||||
Coupon yield to maturity return percentage | 4.50% | 4.50% | 4.50% | 5.00% | ||||||||||||||||||
Long term debt default rate of interest | 9.00% | |||||||||||||||||||||
Debt instrument shares issued on conversion | shares | 715,258 | 715,258 | ||||||||||||||||||||
Debt instrument converted into equity amount | $ 187,100 | ₩ 229.7 | ||||||||||||||||||||
Debt instrument converted into equity amount stock value | 5,800 | 7.2 | ||||||||||||||||||||
Debt instrument converted into equity amount recorded in additional paid in capital | 181,300 | 222.5 | ||||||||||||||||||||
2.5% Non convertible bonds due 2024 [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Convertible bonds long term rate of interest | 2.50% | 2.50% | ||||||||||||||||||||
Debt Instrument, Term | 2020 years | |||||||||||||||||||||
2.5% Non convertible bonds due 2024 [Member] | Stic [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Debt instrument face amount | $ 76,000 | ₩ 90 | ||||||||||||||||||||
Class of warrants or rights number of shares covered by the warrants or rights | shares | 306,539 | 306,539 | ||||||||||||||||||||
Long term debt instrument maturity date | May 26, 2024 | |||||||||||||||||||||
Coupon interest payable quarterly percentage | 0.625% | |||||||||||||||||||||
Coupon yield to maturity return percentage | 5.00% | |||||||||||||||||||||
Long term debt default rate of interest | 9.00% | |||||||||||||||||||||
Payment of accrued coupon interest | 300 | |||||||||||||||||||||
Forefeiture of unpaid yield to maturity interest | 1,900 | |||||||||||||||||||||
Debt instrument converted into equity amount | 64,400 | 79 | ||||||||||||||||||||
Debt instrument converted into equity amount stock value | 2,500 | 3.1 | ||||||||||||||||||||
Debt instrument converted into equity amount recorded in additional paid in capital | $ 61,900 | ₩ 75.9 | ||||||||||||||||||||
Class of warrants of rights the date from which the rights are excercisable | May 25, 2018 | |||||||||||||||||||||
Stock shares issued during the period warrant excercises | shares | 306,539 | 306,539 | ||||||||||||||||||||
Class of warrants or rights maturity date | Apr. 26, 2024 | |||||||||||||||||||||
3.5% senior notes due in 2020 [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Convertible bonds long term rate of interest | 3.50% | 3.50% | ||||||||||||||||||||
Debt instrument periodic payment principal | $ 17,000 | ₩ 20 | ||||||||||||||||||||
Debt instrument terms of interest payment | quarterly interest | |||||||||||||||||||||
3.5% senior notes due in 2020 [Member] | Stic [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Debt instrument face amount | $ 67,000 | ₩ 80 | ||||||||||||||||||||
4.3% senior note [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Convertible bonds long term rate of interest | 4.30% | 4.30% | ||||||||||||||||||||
Proceeds from senior notes | $ 17,000 | ₩ 20 | ||||||||||||||||||||
4.6% senior notes due to related parties in 2024 [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Related party transaction rate of interest | 4.60% | |||||||||||||||||||||
Long term debt instrument maturity date | May 27, 2024 | May 27, 2024 | ||||||||||||||||||||
4.6% senior notes due to related parties in 2024 [Member] | Principal [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Repayment of related party debt | $ 25,000 | ₩ 30 | $ 17,000 | ₩ 20 | ||||||||||||||||||
4.6% senior notes due to related parties in 2024 [Member] | Interest [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Repayment of related party debt | $ 2,700 | ₩ 3.1 | $ 1,100 | ₩ 1.2 | ||||||||||||||||||
4.6% senior notes due to related parties in 2024 [Member] | Stic [Member] | ||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||
Debt instrument face amount | $ 84,000 | ₩ 100 |
Debt - Summary of Maturities of
Debt - Summary of Maturities of Short and Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Total | $ 42,176 | $ 45,956 |
4.6% senior notes due to related parties in 2024 [Member] | ||
Debt Instrument [Line Items] | ||
2023 | 42,176 | |
Total | $ 42,176 | $ 45,956 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - Fair value, inputs, level 1 [Member] - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Money market funds [Member] | ||
Cash Equivalents, at Carrying Value | $ 236.6 | |
Korean market government bonds [Member] | ||
Cash Equivalents, at Carrying Value | $ 61.1 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income (Loss) Before Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Schedule of Income loss before income tax [Line Items] | |||
US | $ 97,918 | $ 89,416 | $ 62,706 |
Korea | 2,696 | (14,199) | (12,839) |
Income before income tax | $ 100,614 | $ 75,217 | $ 49,867 |
Income Taxes - Summary of the D
Income Taxes - Summary of the Detail of Income Tax Expense for the Periods (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current: | |||
US | $ 14,481 | $ 15,244 | $ 8,469 |
Korea | 2,049 | 1,928 | 2,367 |
Total Current Taxes | 16,530 | 17,172 | 10,836 |
Deferred: | |||
US | 8,154 | 5,105 | 5,278 |
Korea | (2,178) | (683) | (2,572) |
Total Deferred Taxes | 5,976 | 4,422 | 2,706 |
Total Income Tax Expense | $ 22,506 | $ 21,594 | $ 13,542 |
Income Taxes - Summary of Recon
Income Taxes - Summary of Reconciliation of the Statutory Rate and Our Effective Tax Rate for the Periods (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
Statutory Tax Rate | 20.00% | 20.00% | 20.00% |
Foreign Jurisdiction Rate Differential | 3.50% | 3.80% | 3.40% |
Non-deductible interest | 0.00% | 1.50% | 0.00% |
Withholding Taxes | 2.00% | 2.30% | 4.60% |
Tax Credits | (4.20%) | (3.50%) | (7.30%) |
Valuation Allowance | 1.60% | 5.00% | 7.60% |
Other | (0.60%) | (0.50%) | (1.10%) |
Total Tax Rate | 22.30% | 28.60% | 27.20% |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Tax Assets and Liabilities as of the Dates (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred Income Tax Assets: | ||
Net Operating Loss Carryforward | $ 8,333 | $ 8,206 |
Tax Credit Carryforward | 12,615 | 9,529 |
Accruals and Reserves | 1,584 | 1,762 |
Intangibles | 15,643 | 14,158 |
Lease Liability | 1,860 | 2,565 |
Deferred Tax Assets | 40,035 | 36,220 |
Less: Valuation Allowance | (18,112) | (17,936) |
Net Deferred Tax Assets | 21,923 | 18,284 |
Deferred Tax Liabilities | ||
Goodwill | (45,074) | (35,096) |
Right -of-use-assets | (2,162) | (2,424) |
Other | (379) | (359) |
Deferred Tax Liabilities | (47,615) | (37,879) |
Net deferred Tax Liabilities | $ (25,692) | $ (19,595) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Deferred income tax assets net | $ 2,616 | $ 560 |
Tax credit carryforward, amount | $ 39,200 | 34,400 |
Tax credit carryforward expiration period | 2026 years | |
Foreign tax authority [Member] | ||
Tax credit carryforward, amount | $ 13,100 | $ 8,800 |
Tax credit carryforward expiration period | 2022 years | |
Maximum [Member] | ||
Percentage of valuation allowance against deferred tax asset | 50.00% | 50.00% |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - KRW (₩) | Dec. 31, 2021 | Dec. 31, 2020 |
Stockholders' Equity Note [Abstract] | ||
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common Stock, Value, Outstanding | ₩ 10,000 | ₩ 10,000 |
Net Income Per Share - Summary
Net Income Per Share - Summary of the Calculation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: | |||
Net income applicable to common shareholders — basic | $ 78,108 | $ 53,623 | $ 36,325 |
Dilutive effect of assumed conversion of convertible debt | 0 | 2,687 | 7,311 |
Net income applicable to common shareholders — diluted | $ 78,108 | $ 56,310 | $ 43,636 |
Denominator: | |||
Weighted average shares outstanding — basic | 2,303,200 | 1,807,410 | 1,192,725 |
Dilutive effect of assumed conversion of convertible debt | 0 | 295,028 | 715,258 |
Dilutive effect of assumed conversion of warrants | 0 | 46,676 | 87,148 |
Weighted average shares outstanding — diluted | 2,303,200 | 2,149,114 | 1,995,131 |
Basic net income per share | $ 33.91 | $ 29.67 | $ 30.46 |
Diluted net income per share | $ 33.91 | $ 26.20 | $ 21.87 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income - Summary of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | $ 22,815 | $ 9,433 | $ 76 |
Foreign currency translation gain/(loss) | 504 | 13,676 | 9,742 |
Actuarial gain/(loss), net of tax | (286) | (294) | (385) |
Ending balance | 23,033 | 22,815 | 9,433 |
Currency Translation Adjustments [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | 23,807 | 10,131 | 389 |
Foreign currency translation gain/(loss) | 504 | 13,676 | 9,742 |
Ending balance | 24,311 | 23,807 | 10,131 |
Defined Benefit Pension Plan [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | (992) | (698) | (313) |
Actuarial gain/(loss), net of tax | (286) | (294) | (385) |
Ending balance | $ (1,278) | $ (992) | $ (698) |
Leases - Additional Information
Leases - Additional Information (Details) ft² in Thousands, $ in Millions | Oct. 01, 2019 | Dec. 31, 2021USD ($)ft² | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Jul. 01, 2012ft² |
Operating lease costs | $ | $ 3.3 | $ 3.2 | $ 3.1 | ||
Area of Land | 49,375 | ||||
Seattle [Member] | |||||
Lessee, Operating Lease, Renewal Term | 61 months | ||||
Lessee Operating Lease Expired Term | 2024-10 | ||||
Gangnamgu [Member] | |||||
Area of Land | 31,636 | ||||
Lessee Operating Sub Lease Expired Term | 2023-09 |
Leases - Summary of Cash Flow I
Leases - Summary of Cash Flow Information Related to Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 7,764 | $ 10,864 |
Accrued rent | 934 | 877 |
Total operating lease right-of-use asset, net | 6,830 | 9,987 |
Short-term operating lease liabilities | 3,076 | 3,033 |
Long-term operating lease liabilities | 4,688 | 7,831 |
Total operating lease liabilities | 7,764 | 10,864 |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 3,300 | $ 3,200 |
Leases - Summary of Maturities
Leases - Summary of Maturities of Lease Liabilities (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Seattle Lease member | |
2022 | $ 1,987 |
2023 | 2,037 |
2024 | 1,732 |
2025 | 0 |
Thereafter | 0 |
Less:Imputed Intrest | (379) |
Total | 5,377 |
Seoul Lease Member | |
2022 | 1,353 |
2023 | 1,167 |
2024 | 0 |
2025 | 0 |
Thereafter | 0 |
Less:Imputed Intrest | (133) |
Total | $ 2,387 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021USD ($)titles | Dec. 31, 2020USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | |
International Gaming Technologies [Member] | ||||
Percentage of royalty on revenue | 10.00% | 10.00% | ||
Long-term purchase commitment, period | 10 years | |||
Cost of revenue | $ 11.1 | $ 13.5 | ||
DoubleU Games License Agreement [Member] | ||||
Number of titled games | titles | 44 | |||
Maximum [Member] | ||||
Reasonably possible loss contingency | $ 201.5 | |||
Maximum [Member] | International Gaming Technologies [Member] | ||||
Percentage of royalty on revenue | 15.00% | |||
Minimum [Member] | ||||
Reasonably possible loss contingency | $ 3.5 | |||
Minimum [Member] | International Gaming Technologies [Member] | ||||
Percentage of royalty on revenue | 7.50% |
Related Party Transactions - Su
Related Party Transactions - Summary of Expenses Charged by Our Parent (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||
Interest expense | $ 2,011 | $ 10,786 | $ 26,566 |
Cost of sales [Member] | |||
Related Party Transaction [Line Items] | |||
Royalty expense | 4,335 | 3,015 | 4,597 |
Interest expense [Member] | |||
Related Party Transaction [Line Items] | |||
Interest expense | 2,010 | 3,106 | 3,778 |
General and administrative expense [Member] | |||
Related Party Transaction [Line Items] | |||
Rent expense | 1,397 | 1,461 | 1,378 |
Other expenses | $ 206 | $ 155 | $ 131 |
Related Party Transactions - _2
Related Party Transactions - Summary of Amounts Due to our Parent (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Schedule of related Party transactions due to our parent [Line Items] | ||
Short-term lease liability | $ 3,076 | $ 3,033 |
Long-term lease liability | 4,688 | 7,831 |
Long-Term borrowing with related party [Member] | ||
Schedule of related Party transactions due to our parent [Line Items] | ||
4.6% Senior Notes with related party | 42,176 | 45,956 |
A/P and accrued expenses [Member] | ||
Schedule of related Party transactions due to our parent [Line Items] | ||
Royalties and other expenses | 511 | 3,631 |
Short-term operating lease liabilities [Member] | ||
Schedule of related Party transactions due to our parent [Line Items] | ||
Short-term lease liability | 1,309 | 1,399 |
Other non-current liabilities [Member] | ||
Schedule of related Party transactions due to our parent [Line Items] | ||
Accrued interest on 4.6% Senior Notes with related party | 6,454 | 4,918 |
Long-term lease liabilities [Member] | ||
Schedule of related Party transactions due to our parent [Line Items] | ||
Long-term lease liability | $ 1,078 | $ 2,454 |