Earnings call transcript Q1 2023

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Operator

Good morning, everyone, and thank you for participating on SharpLink's webcast.

Joining us from SharpLink Gaming today is Rob Phythian, Co-Founder and CEO; Bob DeLucia, SharpLink's CFO; and Dodi Handy, Director of Communications.

Before I turn the floor over to them, I remind you that during today's call, statements that are not historical facts, including any projections, statements regarding future events or future financial performance or statements of intent or belief are forward-looking statements and are covered by the safe harbor disclaimers contained in the company's public filings with the SEC. Actual end results may differ materially from what is expressed in or implied by these forward-looking statements.

With that said, I'd now like to introduce Dodi Handy. yours. is floor the Dodi,

Dodi Handy

Thank you, Gaming's welcome SharpLink everyone, and Quarter XXXX hello, First and Earnings to Kat, Call.

of to Before we shareholders in appreciate questions the we engagement ensure and the all thank We helping advance your us us active first begin, I'd March who topics like the you. kindly going Rob of to to today's greatly call. today's that to of XXXX, cover submitted Bob DeLucia off X which to call for results ended kicking relevant reviewing be We're will financial interest address XX, we've to after the months the received. with endeavor questions most

going with Bob, I'm over it to So you. to that, turn

Robert DeLucia

will my discuss basis. GAAP today, I'll a In will financial basis our and Dodi. all performance. discussed remarks quarter-over-quarter discussed financial comparable be on a comparisons on X Thanks, metrics be quarter All the

with Form Yesterday market report afternoon after the on we filed quarter the SEC. first our XX-Q close,

it you and full had not information our a you've and access a disclosed. encourage section SEC Relations SharpLink's website our to If or everyone and view under on business our filings you filings. ensure chance it, via other read of results XX-Qs Investor I have the may on understanding to financial to SEC sec.gov important

revenue XXXX. growth XXXX. increase our The from In in $X.XX quarter to revenue was for December acquired which of contribution quarter X network, largely XXXX, XX% was new to rising the million notable, late first our SportsHub million from we the attributable Gaming $X.X

each revenue segments. saw across growth business our we However, of

comparable March to Sports for basis. generated XX, prior million Gaming contributed $X year. our a Services ended XX% Revenue quarter-over-quarter $XXX,XXX $X.XX merged XXXX, months group Client in the SportsHub/Fantasy to newly from on Specifically, group X the $X.X million Sports which by rose compared the

And in for from March Marketing respectively. the segment climb which contributed Marketing U.S. the X-month months reported period finally, up business total international to revenues, for $XXX,XXX business $X.XX saw XXXX same compared $XX,XXX was $XXX,XXX XXXX the Affiliate when our 'XX group XXXX. Affiliate to X QX million and X% revenues to Our XXX% ended

to Our QX this to Further, quarter to margin XX%. of the million $X.XX $XXX,XXX previous increased our gross to year, profit first year's also in which profit services gross gross our from period. products XXX% higher-margin of thanks a improved, and mix expanding profit XX% compares of in

declined discontinued million quarter Moving down $X SharpLink months net a or to improvement. in net XX% loss year, March to net of a million of and expenses representing of diluted declined first MTS reducing business P&L. $X.XX of the period months respectively, $XXX,XXX for $XXX,XXX operations XX, loss and operation for share loss a XXXX X-month our same or basic per and per significant last in basic After share, net quarterly which the X $X.XX the by loss million XXXX. factoring the of discontinued $X.XX to $X.XX business diluted our for to from compared million from succeeded SharpLink's operating ended the X first XX%, $X.X XXXX, legacy of loss

balance sheet. over moving the Now to

the beginning the Sports Baseball normal that for received offset end was prices NFL working season following XXXX cash as decrease in of This as XXXX-XXXX the of had capital in million occurred we is million $XX.XX as of payouts restricted by the for well to compares The cash cash and As March League Major cash attributable Fantasy restricted cash. December the in our in and of XX, $XX.XX primarily of the million to payments season January. $XX.XX XXXX, in spend. XXXX. XX, This and $XX.XX million cash restricted

largest senior of first million convertible investors. institutional $X a in financing of via raised our resulted quarter activities one XXXX, our the debenture During with

also addition, credit million $X of secured our In lender, Bank. primary we from line Platinum

So operations cash unanticipated extraordinary will months from opportunities as XXXX, the in connection challenges March year believe the with the notwithstanding be that on or next may hand from We revenues acquisition no XX our XX, encounter be guarantees. of unfolds. sufficient any generated cash there can to fund we the

That now the of QX concludes review financial my results.

the you, So floor I turn Dodi. back to

Dodi Handy

Thank you, Bob.

Okay.

now Phythian like welcome call. to So and Rob our Rob. Chief Officer; I'd SharpLink's Executive Co-Founder to Hi,

Robert Phythian

morning Good webcast. good our morning, and everyone results joining Dodi, QX to

Dodi Handy

NASDAQ, quite calls we call, you with this. get discussing On started regarding our would stock mentioned regain that a Rob, qualify But our in recent have the Received minimum led What with that for had been company that to transpired why phone reverse to to bid period the reverse X-for-XX additional the could which believe case. compliance an appears don't SharpLink not split? requirement. last with immediately? implement work few we X-month you price the

Robert Phythian

that extension. the we for NASDAQ That's qualify we did starting not in question. additional about a period the good to we process early April, When approached request informed grace were the

above required as affect were reverse we approved stock bid consequence, XX days trade a by year split $X minimum consecutive to to requirement this earlier the compliance. shareholders trading our As for the and regain

cured not after is delisted would on On notice NASDAQ. to closed. $X requisite the received for XX, we week, trading or XX continue last matter trading deficiency now our NASDAQ trade we and be and Wednesday the that the suspended shares above We'll had from days, then of May the indeed

Dodi Handy

has the Well, believe a that's Why Bob. serious you is? in years. great Nonetheless, do news, past the X.X that over beating market our taken stock

Robert Phythian

SBC and our performance XX%, Virtually of industry team, of suffered and Meadowlands, and of New source and for regarding in industry traded space stock publicly conference, was company hot our question to all market stock value. in means answer. attended reflecting not this members of price sports discussions good reflecting depreciation another approximately the in of simple with operating the That's Last concern companies as with XX% the At group topic key along industry a us. the Jersey. that is in frustration the loss conversation I, of attendees, week, a other Summit of every peer great greatly among mean betting over one leadership several

experience a long who've a lost few to to group, whole, this as a begun are have in within ground way the there XXXX. While regain go a to we recovery

at multiple Xx mean at revenue, at months a trailing If which trading trading if stock or X.Xx is results. the were SharpLink, at of below on trading Said $X.XX. Looking another multiple group are and sales we should sales X.Xx industry our for under to we over sales well way, our be price above just sales group currently of were we based peer the XX mean QX revenue over $XX.X on pace are on this in achieve in year factoring revenues growth. based factoring to XXXX for prevailing meaningful results, this we this to revenues our multiple of any we giving amount When price expect million our annualize times to achieve anticipated sales stock the Again, be of revenue, to closer consideration would $X growth a X.Xx year. same is without this share. peer without

So market the as demonstrate worthy it to SharpLink is ultimately continue that through higher and is that will belief our appreciation. of performance we market much correct value a

Dodi Handy

were All last at SBC right. mentioned Summit the Well, week. you you

common to sports betting themes stock everyone's So U.S. event? market were other in from the that in any sector, you there with shared saw emerge performance frustration addition

Robert Phythian

to generators of the around technology acquisition of operators revenue media for and strategic is There conversion to brand for pressure the at primary great under players the the of continued CX how has technologies is discussion to takeaway, books years. how solution, news deal good going through marketing evolve is of impact and the the was us, strategy smarter, industry us. growth conversion the coming least of use such leagues, to adopt Well, in sports use a technology-enabled the SharpLink's to that's as

realizing of the informed based analytics heart on player decisions Well, utilizing that's technology brand By of the insights, preferences. industry and our at CX what making does. power is

converting building of from needs necessary trying iGaming the the ground of singing of and AI harm way hymn goal use we've becoming use are most the technology. is to emerging part it through machine answer than been betting. user So to potential others sat panel fraudulent sports into few the been data the end sports is our We industry in listen sports refreshing rates, conversion to up technology. the customer define the to preaching improve on betting increasingly the market perspective, we betters unique years. of to that its in U.S. From meet are higher in and tools on is the SharpLink's illuminating starting last the in rather which we've popular experience, the utilizing discussion, Again, efficient activity. which what the what the for learning and years. cost-effective, to Moreover, for was founded, retrofit detect premise European when due endeavored in minimize one to is It fans drive

that begun surprised converting are that appreciate at a are of games and would reach remain to the the sports the engagement the and has We of a I value not leveraging XXXX role on to platform general will best. that argue that That playing focus to free-to-play the and SharpLink's sports free-to-play of consensus they and appeared of building business fans betters. It also that is the conversions. audience show huge will are in one assets fan gaming considered business we see industry our and drive component a is fundamental

solidly years among of operators experience and our well this Tipico Our list long-standing sports with and media in Sports Gaming sportsbooks as leading the are in growing all such virtually has Services entrenched a of XX in sports leagues, group we of major over others. BetMGM space, relationships

conference So right potential on generally coming from we're belief the that track and we insight growth our for is positioned well in quarters. the speaking, has reinforced dynamic the gleaned SharpLink the

Dodi Handy

possible the for every our of to the proxy on greater to Directors, with other SharpLink our of fiscal rules possible. the company like with the properly the every auditors providing reelection to Board on XX. election this General for of has have to mailed in be all ratification when approval the issue matters be that as proxies or and year, to in every to debenture our use for I'd our held of review as years upcoming vote our what's of material the remind February and the important years, supplied It's Annual now NASDAQ if XX% is meeting. then X shareholders' compliance finally, perspective, for and that its That's going shares going Meeting Thanks very of year, in and your year. X Okay. soon opportunity be you convertible And in your issued connection in Up for than we Minneapolis May SharpLink either brought year vote XXXX Shareholders. say-on-pay this shareholders before necessary, ahead. Rob, secured that may outstanding for any

Robert Phythian

as vote their as submit shareholder every possible. that vital soon is It Dodi. right, You're

XX% We shares of be outstanding the approved. issued require will all to required the up achieve and will quorum. require And then XX% vote our proposals to the all shares for of votes

through a preparing and proxy but is costly necessary mailing Going the process.

like these of each shareholders the we'd add get Directors that to in encourages vote So favor of Board to first time. successfully I'll completed our all of proposals.

So your get please in. votes

Dodi Handy

Okay.

today's have thoughts like conclude share, final we any you you'd call, Before Rob? do to

Robert Phythian

of succeeding us SharpLink bet Yes, our all decline and my to betting in that dedication our has do. your reflect Nonetheless, hard share the not continued committed persist. our shareholders sports to and belief and mission. in for the We're us I will work market industry. results at you your The our are Dodi, delivering fellow performance confounding I'd can the of to team. in how like volatile macroeconomic tangible conditions general that value all hurt sure thank support all of

the quarters. not misplaced. in We coming to that prove is intend trust to Your you

attention we So plan. close continue our as evolve please on execute pay exciting and to

Dodi Handy

Okay. which as results, Thank second on to following will our to mid-August. is thanks well. the held our you, quarterly release next happen Rob, expected you, Folks, or be about webcast of Bob, and quarter

a our So for webcast those listen replay be on website, of available this to today like you of will would today's who sharplink.com. later again, call

I'd to said, a everyone like that with day. great wish So

floor the you. Kat, back So to is

Operator

you thank for This you. participation. does conclude your our We Thank conference.

lines this day. have may at wonderful You time, your disconnect a and

SharpLink Gaming (SBET) 16 May 232023 Q1 Earnings call transcript