GLUU - Earnings call transcript Q1 2020

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Q1 2020, Glu Mobile Earnings Conference Call. At this time, all participant lines are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Harman Singh, Vice President of Finance and Investor Relations. sir. ahead, go Please

Harman Singh

Good Glu and earnings Mobile’s operator. joining conference you us on first afternoon you, thank everyone, for call. Thank quarter XXXX

Chief Ludwig, call Officer; Officer. the today Nick President On are and and COO and Eric Chief Financial Earl, Executive

will we and We to call, forward-looking These risk making this this are you those based the recent update assumptions make the today could materially SEC, we conference events Company. Any described Company statements factors of that that be factors of financial from are Forms our events. most date. in the performance a more the cause During reports release no actual the and future reasonable in believes forward-looking with the and caution on obligation in be documents statements XX-K this during the these regarding to specifically future statements result filed differ consider undertake call. results forward-looking fully statements as to important future that press of We on to XX-Q. the as

to superior call, considered a we both we will intended non-GAAP isolation decision. consider making and measures. in encourage non-GAAP to all or GAAP this to financial results, are substitute investment investors not GAAP for The from, measures before an During financial present be and measures

our quantitative regarding information, www.glu.com/investors. that comparable accompanying refer the via be call financial our information presentation non-GAAP those reconciliation the of investor can a complete figures, measures earnings For today’s most supplemental and to directly GAAP website, accessed please

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website We are PowerPoint easily this also accessible providing aid in the a follow supplementary during and call. IR earnings you reconciliation. on are the the conference encourage Excel this Excel with file slides along now on to more our We website. to file Both

that, And turn to with I would now call over to the like Nick.

Nick Earl

Hello Eric, pandemic. Harman. today's today On will call, highlights for first our thank it everyone, over Glu's quarter the update and to and discuss then more our some on financial I Thanks, XXXX and detail. provide overall you will development results for turn an will call. discuss who of on joining that, COVID-XX thoughts game I After impact provide first in will I quarter earnings us progress. guidance

families and people commitment appreciate First together organizations have your the well come those time. and thoughts during that off, I of are hope are our unprecedented global the We with and address to impacted. this difficult this emergency, you all and health

Our gaming during primary their and of the the employees pandemic families and safety the health community. is our focus

providing to in our Baseball put dedication Tap Glu productively the XXXX our planning and entire and environment. At implement launch Glu, to us This to remote us the the policy, work Sports resources in and operate employees Sorcerer's continuity of a the team. position safe Arena, pre-COVID allowed needed support reflecting Disney successfully business quickly a preparation

enjoying players for engagement new downloads. and and our current mandates our more for to to in shelter-in-place Global have opportunity time increased discover higher us, resulting games, players organic spend provided an

with key sizeable Home, four lower which monetization Kardashian: two years Adventures CPI Kim since to months confidence the similar will and far they titles, significantly the so ahead. games us enjoy in of for DAU providing combined Covet retention and new opportunity us our invest Design Further, mid-March, been cohorts DASH had has we to our to given factors the continue These players, across driven These our seeing Hollywood. have portfolio. have and our Fashion, Diner growth existing

In fourth We growth topline XX% our continued year-over-year beat year's from to $XXX.X quarter. quarter strong expectations with the last meaningfully momentum we first million. bookings our

met also UA our future user line our We base to investment expectations expand increasing bottom for while even growth. our

with strong liquid were our the the quarter, maintained and at growth bookings providing in free the and by These decline improvement our end $XXX to We’ve plans. debt results accelerated in our driven increases cash balance growth a games. in of doubt an catalog games, in sheet support execute of million rate

impressive of with $XX.X Design bookings an third performance record experiences in player base. by million, series driven consecutive monthly Home quarter larger a

Looking the new team continue tune experience. deepen execute further to fine a continues ahead, live user while robust to elder plan, the and the flow operations

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including tracking Baseball that start community become instant ahead franchise a and bash, delayed have stadiums, bookings higher strongest which live performance ops record the currently authentic million. $XX.X had XXXX target These phenomenal an bookings MLB drove franchise's Sports of year, the of is to with the favorite. total faster This to includes despite expertise consumer last engagement. and ability year's MLB to improvements the to Tap and testament a led content first has team's ever, and new generate version quarter drives the season. engagement monetization This features

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launch. are year's We encouraged have Adventures by seen we very the DASH since progress Diner last in

returning its in two schedule came game new Hollywood highlight, to strong outperformance players, QX of This Kardashian: catalogue strong and Kim highest merchandising a in techniques. $XX.X with quarter continue leveraged momentum, on continued the QX Turning by marketing effective and ops a bookings with drive live new years. strength of to million, both bookings

Additionally, we announce through pleased extended will license that which with we in Eric our to Kim detail. more cover are XXXX, have deal extremely

we Incredibles, operations characters Disney launched monetization and more. is our Toy events Sorcerer’s in Story, strong rollout Finally, The The The core-RPG quarters Pixar game title is years. to and calendar team will and is successfully newest Pixar released Onward experienced film title continue the and franchises to iconic both Disney events of characters including King, features with This alike. on Lion over Disney, exhibiting Arena and maintain based equipped the featuring from Aladdin, resonating fans game The new worldwide. players robust live and newly coming a and

been in While to after have we a trends have shelter-in-place marketing seen solid participating mandates additional we look initiatives organic forward lifted. to-date,

are Disney our We talent have that the game. been extremely making invest of by we growth Sorcerer’s impressed this successful and title, a team, Arena’s given of to we’ll belief in continue

to content. Moving story the to interactive team our continues refined our studio, pipeline, of Originals, platform Toronto development our as add continues

retention the still need and short-term While we retention significantly DXX early monetization, we the increase elder to pleased and monetization. are with

features retention and select advanced stability World's to support modes and cadent inspired We first and territories. World now matter on longer-term early retention The Hunter monetization. are beta and player-versus-player with will new pleased progress our for enhancing in drive Deer implementing will focus team Deer Hunter with social also the on time.

While progression traditional that franchise success. as maintaining core enduring loop the and this has fueled

are on potential be and to title's second-half about the in launch track year. this excited continue the We global a for of

to Orlando game on social enhancements. in stability new studio game fishing Our Glu our make user Sports continues progress and flow including

mechanic. currently we the beta, is launch beta in on focused fine developing title's stage believe are features further and track This and on We in a XXXX. meta and social for early global tuning core

This across XXXX and Sports well We position Glu title gaming Crowdstar Development our umbrella will key Crowdstar out brand, Fashion. mobile further Design in continues Covet includes drive is these our as on both Home of part next and leadership and lifestyle as the believe categories our pipeline the title industry. brands our build which PX.

I'd give update to of growth on Next, like opportunities. longer-term our an two

complement assess to necessary achieve talented game and proven that nurturing growth finding we teams new front, continue and expertise will and portfolio M&A of existing the titles, who accelerated record then track and a On profitability. and to studios has our strategy, resources additional with growth studios critical the

of are Glu Home we browser, connected key on to focused broaden two increased Design connections audience opportunity cross the through audience our and deepen Second, opportunities web our players franchises, that Sports with will extending PC includes which expand accessibility. play. Baseball Tap and This will platform our

by this strong progress have with both to this made initiative have and summer. launch We expect soft

quarter, DA helped key and engagement current first start Our year ability raising We results, and monetization. confidence quarter gives our launch drive use as our CPIs. title and increase improving with successful significantly as our our believe significantly strong expected the Disney of retention positive to the live continually us Shelter-in-place amplify trend higher ops, outlook. to the very our mandates have in better full these lower titles across well paired than

confident XXXX Glu Hollywood, is position year While are Diner we game financial in growth we uncertainty, Disney to improvements Kim greater continue that Sorcerer’s outlook. the and an position the we unusually Arena in great the of moving addition or second-half a DASH into are high-level meet and now of and brings beyond. raise to our of with bookings, stacking Kardashian: the momentum have and a Adventures

thank our community unprecedented times. fortitude like in employees I'd our to closing, these and their In for

details to who’ll now I'll up provide turn our and it Eric, financials on outlook.

Eric Ludwig

with good for make highlight a pandemic. look the year strategy UA call. Nick, financial the afternoon and at how comments and XXXX. high-level walk business then to and managing our first everyone second will are coronavirus full on provide results also investment the I we Thanks and and guidance Great. the through our I for will closer we'll quarter the quarter

an to for for scenario. comments started robust coronavirus In is has reported work were due of in our February, continuity want financial the cases the from place, amid home quarter, the I located fact States, the Before I as Glu general in headquarters shelter-in-place. the preparing the provide and that potential plan first we we results in the how zone. operating our pandemic in a business are first to United earthquake discuss a

initiated tests teams to solve February bottlenecks isolate IT internet, one issues on our access, most was working productivity we Wi-Fi, and and the of in helped days. and to equipment This from March, end the ordered challenges. other VPN those At of The two for impediments. based employee home to on those assess tests goal home early determine and specific

from XX, employees North March of American home. all began On working our

for conferencing Our XX. and and video infrastructure we cloud and tools over did Virtually leveraged year. our India location of a based, all the are on March Zoom have bought same built for

our managed in live home our Sports mode. all have We our from two Disney XXXX and of Arena new with titles Tap XXX% Sorcerer’s launched Baseball games employees operations for and of work

of to discernible our and this and business onboard hire for live has without both of to any town developments. loss virtually. Bi-weekly We hall employee been operations new games host All productivity, done and games interview, employees and new our employees continue or

Our right is safety primary base. the of and health our focus now employee

we Although worldwide, not coronavirus. employees there is very of the cases any limited testing have reported of XXX our do

our eventual Our government be in with environment mandates an local, and to guidelines. will state return and office coordination

to not cautious the ability prematurely. be to a work we return from office Given effectively will home, to our initiate

performance our delivered this growth results, in we quarter Kim better topline Kardashian: and expected In than Hollywood. improved performances first by led games, and year's accelerated

a quarter bookings. March. increase Ad impression bookings. bookings last in free Looking total first change at Royalty $XXX.X This in started of year's to generated IP quarter. $XXX.X per were Normally XX% titles million CPIs direction. revenue million. XX% the CPM $XX.X move was XX% Bookings reached correlation and first ad over revenue the or same of or million Glu

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ad side are not demand on ad materially And we have business. revenue and platforms. has also in exclusively a like partnerships uninterrupted. Glu’s the exchanges Thus team. remain allowed direct robust on sales We that UA This impacted focused Glu not many have to programmatic ad Facebook with and platforms seeing does demand for revenue CPI ad our decreases

which million a launched new of Our a games grew to on basis record. increased and version, XX% year-over-year XXXX with the Design a and total contributed XX% franchise year-over-year XX% XX% new The bookings. $X.X million, record the three bookings Tap consecutive quarter March $XX.X including growth Home from Sports On to $XX.X Baseball million, grew all-time third XX.

bookings million. on quarter. was to another $X.X up Kardashian: for XX, DASH million X% in million Sorcerer’s XX% strong generated deliver bookings Kim million. launched and Fashion Disney $X.X to Adventures with quarter Diner the Covet up $XX.X generated Arena March Hollywood and $XX.X

the North America commissions adjusted million, in were On a platform adjusted as and In expense we reduction $XX.X hosting royalties mid-March, CPIs, saw on leaned as were $X.X pronounced this were costs $X.X began additional side, million and above while industries curtail million. into spend an favorable ad quarter. many guidance, for invested their networks. UA $X.X EBITDA target adjusted the CPI our environment our beating still We mobile sheltering-in-place, million

any the spend out the or in to Operating of North our all quarter. UA million net as exchange of million expenses would excluding I year. America, virtually year's first XX.X% OpEx million. basis, our as with marketing bookings material seen compared and of $XX.X marketing $X.X $XX.X a $XX million and million are was $XX.X UA was end last were foreign XX% GAAP and April, On compared not that of we through have impact bookings loss well. point last

by wanted how favorable have we CPIs at additional mid-March, ramped Looking and Since our second our with installs. commentary spend to I we second budget to higher double growth. quarter seen the portfolio some environment millions have coupled UA lower have paid on UA drive increased continues provide invest quarter very overall the and investment. for in CPIs dollars guidance, incremental The of to UA further the digit

in seeking seen social to window. buying titles flow the topline across through prioritized outlet month digital of organic have a our due and with increase this Additionally, growth sheltering-in-place, In we consumer April, we to entertainment. over a sizable marginal downloads due favorable

and and provide second guidance. context to to March I’d three April we like year games to key on other walk quarter update titles what saw provide through an growth our and three full in to

as have the Sports launches performed Tap for the up very period. May the XXXX comparable Despite XXXX Baseball to recent a of gates. compared of Baseball professional is out season, two XX% Sports Our baseball well lack Tap Xst April to Xth

on absence been by amount The has while down conjunction The of across last any driven that a VIP spenders, organic in version countries an immaterial version an the Tap the we star has sports Baseball to basis. year-over-year with this contributed sport outperformance In provided downloads launched have Sports outlet are over XXXX believe live year's total. we new have for the globe, fans.

is Arena to a off Sorcerer’s great start. Disney

in lower seen the United in UA during increase than the in We in Canada worldwide investments. launch CPIs saw have States we during an beta, our resulting

performance scale is to which fourth in X adventures of year's and X on Arena making XXXX, Phase investments year of full pattern of product pathway to results during standalone digit quarters. identical Disney inclusive expected are with the Diner at even This in in basis, to the last For users UA, is team to costs dollar in UA. million we loss, be a our break profitability. is This Dash second-half the third due will Sorcerer’s Phase title drive high-single a

call the in CPIs, is bookings in UA Dash growth towards favorable game, starting which has positive linear have very game Diner in gone to from being a momentum early it June cadence increased evolution lower systems to with content launched ops, of ARPDAU our live to too we a month investment This a growth the saw quarter. and last ROI update first helped meaningfully It balance the April. one. positive A February. Dash but and a adventures content recent elder the transitioned have appears Combined Adventures through of and Diner increase updates. has title to

series to-date. growth increased had DAU and in The QX ever the quarter monthly percentage XXth Design record largest the that our the Home seen April was digit April. great growth. double QX year-over-year have of other and and performance two Wanderlust a seen our Our quarter end series fourth to a has second games and consecutive the was Bohemian

and DAU quarter a a a and had due month strong April, spring season in launch. robust Fashion Covet first growth record to

has catalog at UA year-over-year of XX% consisted our and titles to declined catalog plus investment. have a Our minimal headcount Historically, have historically that games no rate.

XXXX. in for higher new new users. a in and quarter engagements, of be our continues And the the first year-over-year reduced Kardashian: to lapsed well all This end drove this exclusive. recently well X.X players, which with XX% Hollywood was saw reactivations decline LTVs. driven continue grow to catalog was signed increased through The of on turn which year UA year-over-year XX%. as investing an May influx effective extension We as as by Kardashian, us contract modernization allows This as Kim game basis, a to of X, Kim investment and

We providing profitably opportunities to user our acquisition us recoup further base. and with invest grow to royalties, able paying user are spend now before the the

four is point believe in now to that which was Diner Home These Kardashian: titles RPG casual strategy investing sports genre. titles in have Hollywood a Sports Design DASH Kim growth on the Adventures. in, out active path Hollywood six genre. that the are beyond. across Kim we lifestyle in genres. are and live Covet XXXX modes. We The Fashion. team is all of Disney are becoming would we outdoor Sorcerer’s The Kardashian: I And and operations Arena six genre Baseball key that features and genre and Tap is

our last well-balanced did titles is to CPIs of under one allows any UA that able against into not investment are and CPI pressure. be in and this we diversity should In lean We genre, This not have diverse year. portfolio increase genres future us hedge the to pressure.

favorable the UA We the times shelter-in-place environment engagement realize across are mandates the unprecedented and various that are temporary. and uplifted in globe, the

we user remain the we and long on in While, the whether high of the CPIs persists. engagement how new low we are have cautious competence to-date, cohorts performance acquired have will

we are assuming As full approach following a taking our second in quarter guidance. and such, and the year conservative

are not For the assuming purposes, modeling that we CPI does environment favorable continue.

forecasts will that of XX and year. remain revert to CPIs pre-COVID title the our of at the level All in end mid-May, assume those levels levels through

pull forecasting and have of starting in immediate booking aggressively UA and on reduced in through May will March the spent are CPI will I have and continue reflects XXXX, back on this an guidance and impact and We This mentioned. second-half we guidance the April, our just investment. through

reduction grossing that shelter-in-place One assume American players We of lower top focus in mandates UX have an the expected thus titles will profitability. as downloaded have driving are pullback our non-paying corollaries of to [ph] during the North engagement we our scaled decline, our the these be shift this lifted. players that the DAU once from will games and shelter-in-place rankings, will

As there unclear today, of it Major whether season. Baseball a is be League will

imply the of high-level paid assuming could XXXX possible Tap Sports this CPIs capture organic is QX season, XXXX. the until our second-half If Given of believe if of a it and would now compared a increase, drop for downloads This Major uncertainty, be will as date have UA and levels, quarter the Baseball that that year. would to UA to accelerated gradual ramp current flat from could we Sports pullback the spend League does in Tap occurred end with Baseball opportunity. new we we're that year from the in Baseball pullback

Baseball mentioned the the based we'll Home. XXXX PC Design of Nick over browser Tap be Sports versions that summer beta launching and web

in guidance our nothing embedded either. have for We

UA organic that monetizing to now analysis on other our and believe cohorts. as behaving are very for or have players We players And same is that pre-COVID-XX monetizing our spend spenders for will as and as similarly, via after the they whether discovery, remain player compared shelter-in-place lifted. base mid-March paying play assumption our games we that this April they cohorts. mid-March, way downloaded paid paying will Now the since

Now exclude quarter such in our to worldwide the booking is new guidance Sorcerer’s March. any went is Arena from late contribution launched. title until philosophy titles after Disney live

any titled guidance from not will exclude world, XXXX. year codename PX, new for and other include guidance from both Crowdstar Originals, second the Fishing and now that quarter that our our full titles Deer Sports we Tap in any spoken have game will our This We implies obviously bookings about. bookings Hunter

on expect million. For bookings million I based the to of the discussed, second quarter, $XXX we assumptions $XXX the just range in

at On cost significantly hosting royalties be $XX.X million the bookings costs expenses side, environment of commissions up adjusted expected be due CPI our will spoke million. platform the I other to up operating midpoint of $XX.X of we expense favorable just adjusted and about. $XX.X of $XX.X All UA guidance, to are approximately million, $X.X million expect the adjusted million.

The due first mid-single a will EBITDA be combined our digit of in QX results XXXX is adjusted digit loss first-half that with for of the implied quarter versus This implies the profitability millions, mid-single of millions. guidance prior guidance our of we to on second to low second remained adjusted the the upside flowing and If higher UA. may bookings versus we we're seeing upside the spend quarter. in that balance the have through will continuing actual EBITDA quarter, CPIs for entirety

very are of on adjusted EBITDA focused the leverage XXXX. second-half We in showing

addition based a from uploads an we're momentum renewed performance Adventures revised year seeing, approximately record DASH titles. million prior increases to beats, increases offset flat business the XXXX, reduction increase being of core the is from range It not Sports in baseball $XX and and are the of the million Hollywood, Tap year-over-year, Sorcerer’s million. for from on and Kardashian: Arena. partially the to season. million. forecast business our on Home core both with quarter from $XXX that based professional The $XX.X of includes range $XXX These assumption assumption expect our Kim due XXXX, For internal Diner these of on Design Baseball bookings there is $XX.X of million raise This Covet Fashion from an from on first $XX Disney beaten full includes our we Disney excluding million bookings the the $XX the million

flat CPI levels. flow the be bookings QX result expected of DAU. of to assumptions UA midpoint bookings from our as be are spend, QX, with roughly QX a expect bookings higher the QX down and from expected sequentially to We through lower lower

see continue League the assumes favorable, if upside of Baseball shelter-in-place the Our around uncertainty low Major We guidance is XXXX a and uplift potential there and at third if a or no second-half levels. taken behavior. fourth downloads We've from consumer elevated mandates season, could in setting if due environments. our cautious to organic XXXX CPIs guidance, view CPI remains of quarter bookings to second-half guidance

the side expense $XX.X will adjusted adjusted XXXX, be year of full we the adjusted of bookings operating expect of for UA costs million, commissions million. of the million. bookings. On at and reflecting are our and costs midpoint XX.X% forecasted other $XXX.X be hosting expenses million $X.X of platform guidance, royalties approximately $XXX to $XXX million, All

of terms anticipate and in the QX, and of adjusted is exiting an third profitability, again quarter. from to to lead very from XXXX XXXX in fourth We year. similar last This fourth second-half to to increases to EBITDA the spend adjusted In quarters, QX QX quarter-to-quarter UA XX% will expected least of margin with decline QX. at both EBITDA

a million we resources capital and Glu debt end cash. expect XXXX $XXX at and liquidity least remains to a of From with free perspective,

CapEx EBITDA Our requirements quarter's cash are to and generally adjusted quarters $X $X million year, free million becomes a this flow. last thus approximately

very extension In Kardashian: and in launch successful resurgence Sorcerer’s Hollywood the DASH the Arena. Adventures, and summary, recent we are Diner of Disney of Kim the improvements by encouraged

three from two from stacking installs and served growth the bookings games, we top stacking positively on our strategy our months. We further over higher CPIs these have last increasing bookings organic potential accelerant as growth This three impacted of also are an and been of has games. by now, lower executing

year New to stacking titles will year later effects. next the this and add

to that on I progress look open the we'll Operator? updating in call August. And with for forward our questions.

Eric Ludwig

Michelle?

Nick Earl

Operator?

Operator

your Franco Grendan. line [Operator open. is Instructions] And

Franco Grendan

a a letting questions. before successful few paying sort deal be about percentage does for that royalties. you'll Kardashian? any mentioned recruiting UA What on of be bit royalties Kim mean And thanks you the you'll with that Congratulations talk of afternoon. you paying Good of this for the out? execution. ask Can the Obviously, kind little

Eric Ludwig

thanks for the Franco, question. Yes.

and I is So Kim’s royalty rate get acquisition the the we rate the What effective our And minus in same, spend past. said then the we’ve to was to royalty not what UA, that remains payments the that royalty recoup the say becomes we net though in revenue dollars can user specifically we to quarter. any rate apply then royalty given that Kim.

the it past rates. for years, has royalty net times six Whereas been last the in the revenue

base these So the both to years, a which Kim in upside today's opportunity X.X in to us keeping rate the age invest her allow user growing share very day real and will cases relevant for this next is and and the for and Glu in UA.

signed was just of And frankly, user ago for the the there a discovery. because years when original not there deal, was organic need acquisition, lot six we

and And so reflecting of this base, appreciative her really being And grow really that grow of is invest the her, are reality model opportunity. user we the today. to business able with

Franco Grendan

Okay.

to your time? catalog in then -- to your it sort like Sounds good. goals And do sort I said, the this momentarily? at guess, with turn game that Or just add that of you is expect of to

Nick Earl

’XX. this of But game. year QX, to for And that a the our for resourcing Kim. a feel a investments down signs worthy one. going is on this it's perspective, both into the we Franco, in one what say, Nick. it got revenue can't given momentum Yes. on we've I officially Hi strong into even QX it's us investment really and at It's and doubling we and the and from are the end doubling intention really furthermore, given see We of certainly when closed of is next until growth this the we call ‘XX a And the we would that tremendous is started we've deal deal. candidate the being feel versus That's certainly a down see signals fact the carry game.

So to strong tune the fine extra like this given continue features, experience, candidate. content, as we feel the new a systems,

it certainly this officially such. treating So be on question to to next but we're definitely able top we will further. we'll of grow trying be as that year, even answer And game

Franco Grendan

And now, XXX, I then launched guess of it's off seeing what good one on Disney. it? in to you start. Obviously launch since [indiscernible] terms are retention a -- But you've

Nick Earl

is we're engagement, happy Disney KPIs right so, expectations. the and investing monetization, some Phase that conversion in at the are the still game. -- really seeing are expectations, we're early above where in were many But X with, KPIs our retention, the Listen, board, our saying our we're Yes. phase, its across original

ahead a the it's like we're of go got the going through games its it's being Diner is that gone us has where our feeling really investment. for of for solid got that just lot going respect. innings, natural but a of through, like has DASH game And the to in So, still we've in part, this the forward, arc Disney most early componentry

So, top yes, we're in are done it's the KPIs, to very talented think and into X line. believe bottom improve Phase that very before. where right and X And with going a this and Phase We both it who's next we'll solid we game. now X a Phase year. KPIs. through to it's very team We And experienced the improve the take they're going happy be

certainly And it's path. feel early Kim, is Again, that again, signs the it's we growth like this got being on game. of a and but signals

Franco Grendan

it that's from me. Alright, Thank you.

Nick Earl

Thanks Franco.

Operator

comes question the Matthew of your And line from next SunTrust. Thornton from

Nick Earl

Matt. Hi,

Matthew Thornton

season some Hunter, League things, the land Anything be helpful. guess, to where the Major question. PC off A for or there. not a we helpful. which get when for initiative, Thanks include web the out couple And the about think kicking got else versus missed We've expected. you taking could guide. Deer of Baseball revenue you if guide I would I could. A have year called couple guys. the Originals be could I Hey, steam which does obviously, was

is window, the And up here? numbers to would through question back-half user unusual guess assumptions flow into given to the how lands other take color follow-up. I've on spend in obviously here, I making what converts taking acquisition. are the be great my XQ is the thing wanted year? to then I But you of. this that the you're one extremely helpful. late advantage is, back-half does and And spend got any which of in Just that there how get XQ Obviously,

Nick Earl

Matt. Sure, Yes.

our for conservative, very So, would the is guide second-half of I year. the say

the the June. on seen as my to as QX a about UA QX, remarks off is back-half of a for on year. as largely month April, back, of CPI the and really mentioned under That the lot and and is in guidance what April. and environments March implied May in at in million that really each the May dial expectations for And tail prepared seen in tail because will think great XXX-ish we're we've QX well our $XXX $XXX I I we've based of off million June, this

seen to assuming That's organic kind point in really and But not We're we that downloads well. great two, one. forever. back number that Number know as mid-March that's last also April as we've that going of dials well.

place if I maybe in downloads be face CPI sheltering or just in favorable, continuing, favorable in stay the months due on of environment stays So, organic beyond. it, the if think upside could both to that summer QX an and

point the you season. out baseball rightly did Secondly, that

XX% on on call -- this think was So, I've and May X thought was which most basis I X, April up people from surprised down. that most a to it people I year-over-year think got is whereas my assumption baseball,

year. that year. the very taking for outlook the par be to cautious We with of going are It’s last on balance a

Just should right pretty in seeing we're costs absence baseball we don't elevated the behavior season believe know now because baseball down the We happen the fan season. if to absence to do and behavior that does a occur, for of costs CPI of consumer drive in what's season. a going CPI that

would on helpful then topline. obviously CPIs. the and So, that be helpful would a certainly be season helpful would We season organics, be in believe on the

about In time our happening. not guidance to cut of season this my the from prepared remarks, $XX of for last time million out kind about we I baseball talked

was a downdraft. that So

out up increased $XXX million, a guide of overall but the lack to million because of baseball $XX I took we to So season.

And then rightly point lastly, you well. out as

have for this year, We Originals Deer from slated Hunter, nothing which as well. are and both

this to could of I'd the those the confident or strong six to-date as that looking of our million the $XXX strong very, that, April prove is given million, items the So, probably seven and days so I that at $XXX sitting given had guidance for guidance well. May very far key we’re we very, very very today say in five that here say that year. conservative today will

this kind give So, how we that’s guidance. of

Matthew Thornton

million take would kind in follow-up seeing that today there are Tap kind give or the on progresses? as out, two season anything the that data to maybe then seeing you're $XX And Sports the Baseball. Is that of part of you that decision that there slowing informs be

whether thinking know I secondarily, Disney to Thanks be double then If a wondering guys. you DASH a approaching about lot to just of the you'd about And color realm around well you if that's single, willing as double? in be think talk use any baseball provide titles. the a as analogy how again of or the a willing Diner new you'd you're I'm there.

Eric Ludwig

for thanks Yes, that. Sure.

So, seen the is to month We've April the the of cautious. answer not any be short from performance no. degradation in on baseball

just wanted going and no, and and guidance. have had having do in rather days, record to in several Friday seen know we've what's Fridays, And we be weeks this Friday think to cautious record that to backwards, conservative we've row than game. not several we happen. a However, big Friday we've events we the as But Fridays, guidance I seen in walk

us have what's will abundance would it's nothing support in far very, that the so know to to very record, but but expect give of one up, elevated. show just We we've certainly maybe given environment. not the baseball more to don't we seen no, tomorrow. be, caution a not being happening But I just

with aren't the singles, games those so in terms in our then informed design we've slams. the triples, of We've talked some got a is Fashion had baseball a range. home million. one a singles for about the maybe million triple I've Covet grand low range. $XXX being the that past, We've conversations in of runs, million high-single about baseball to part, is on of got doubles, million. in the home a million is the And end double $XXX $XX at $XX-ish million then, to $XX $XX And

one. hits believe that I that a don't in game would say year its potential we

guidance it's gate a So, the million approaching would that events, hopefully Disney a that with now, $XX operations and be guesstimation, Disney a a right of now, I of a say is would to this year, very solid single. from my a at is believe I in out year for of like is double three very our monetization year year and track of full along forward-looking a could with with high-single, live on category. it maybe statement belt in from under improvements just quarters now

for April. QX. about million the improving been I This mentioned month DASH, Diner in the probably million did last in in it's year half $X.X million plus. that’s $XX $XX of And We did year. year

there, So of but at of right low towards the that's single, the to mid-single. migrate kind end starting

Kim this quarter, just So, and last then million. Kardashian million did $XX.X $XX

past years Kardashian And that single So in Debbie ago. five, higher has the, Ferly the than been six that, four, Kim [ph] even in category.

stack written had and quarter growth now year, our have strategy believe from very that now. last six we're here when a So off from top Many been what we growth months our year we of to potential I’d our people could additional sitting be that have we games on frankly really additional is, year-on-year-on-year. well been that in last three has three impossible believe say games titles. bookings growing And stackings

Matthew Thornton

the jump I'll back guys. queue. Thanks Great. in

Nick Earl

Thanks Matt.

Operator

from Darren next your Capital comes question line Aftahi from Partner. And of Roth the

Nick Earl

Hey, Dylan.

Unidentified Analyst

for Thanks on Dylan its for Hey, taking my questions. Darren.

far fishing favorable Tap to so strength as season. that sort fishing such it? of sort of for big Sports doesn't without season seen of one, aspect you even like new game se Do year-over-year, your First a given an MLB Baseball as tailwind on with you've the that per the that view have game necessarily on a

Nick Earl

I so. think Yes,

reasons I only worldwide. but think not is like U.S. it's the such a massive to certainly lot we that the of secondly, why got just and fishing, It's following broad one season. And tied a are of there them. in not

love the it paying So royalties. fact we like not we're that, we that like it for for that reason. We

we it. another So reason why that's like

that We Glu that it's love Sports fact studio. set the by really up playbook following been the our has also

There's the simple, lot built style enjoyable elder game structure core you goes a but structure. that around a design very and is very, a game and of the with RPG really that mechanic engaging an has deep into know, the that but

in let's like we're still game. early We're So still It's lot sure testing there -- incredibly make stable. is it. know, but reasons is that why that a out we of it, the you as for it

user new the that sure flow works. make Let's

sure It's make Let's still state. mechanic in the works. that

social We out really haven't the and features yet. elder built

we and about like So, fishing, to have earnings we'll that lot where but is stay we a now like the over it tuned calls trajectory. on coming talk right

Unidentified Analyst

more new players were to similarly as at players. during talk mandates, gained rates talking behaving Got Or it. home at And similar you’ve monetizing when sort of towards of that then sort of these you the about well? they engagement? Are some you stay older

Eric Ludwig

Yes.

this Eric. Dylan, is So

of paying by we've acquired The that similar that players that their they playing and kind we've or paid So, monetization bifurcating players engagement, cohorts. via their players non-spenders behavior, playing user are either very acquired spenders. look that their are their prior and are organically retention, acquisition, to

particular. Design seen in have Diner our titles, Dash of particular Home We several in

place, update late staying month a of it big the at average user. last we we we've sheltering February significant in seen monetization. maybe to Adventures And actually like Diner Dash chalk bookings in We did a in and January. parts up in daily half increased home, a active saw Over per that of some but other increase

before well place cold. is this to any in So sheltering

monetization done. and been improvements has we've some So to events due features

at happened just But the just much Some acquiring behaving are naturally. that generally people prior has in cohorts. very they're home, sheltering we like the

And in we that minutes life, difference sheltering a so And doing that Design who's a going already for play to that that engaged or that in game. for five that liking they once not them. somebody paying that's be not even Home in month, we place to now their they paying each that huge gives us events think day event, they're three are confidence two to go believe they're when day-to-day a player past we back don't the downloaded from going that

Unidentified Analyst

last me. And one you. from Thank

your soft potential Would entail? of summer would be at does players it exactly games, all towards of them? and sort it launch the On push that what released this existing you platform market just the to or cross

Nick Earl

two the is for the complimentary mobile to it But The mobile to fits that games though, potential, that to we're for ecosystem it audiences and we later that them in test the year be is not to the that audience Even out we've make a and different a games. be those and not complimentary it We're created really fully it's sure This before. it sure market there implies in it's we until it different is and that certainly has two because not fully enhancing, really stable done soft to those determined. we've will be it version. us want making launch putting marketing. going

we'll take So, front be of opportunity games tremendous the these this is carefully. on able very and PC there larger audiences. in even But to cautiously to a get believe do we

Unidentified Analyst

Great. That's you. for me. Thank it

Operator

from question from line next And your the of Stifel. Drew Crum comes

Drew Crum

implied Understanding Eric, afternoon. the two Good doesn't of second-half the math part guidance. right. adjusted new launch margin as in games that XX% your bookings is if is to include the of my XX% range

Phase they're of life, how Assuming X in moves the should profitability think their about around? how we

Eric Ludwig

Yes.

obviously, you your So math. Drew, know

when you be would XX% math into you're least at plus. it QX that was higher guidance my the than is right a So Yes, back XX%. number

So, the about back-half year. two obviously of talked titles launching the in we've

launch included guidance for is titles. the those already budgets Our

that. reflects So, my EBITDA guidance

Drew Crum

then Disney your UA you plans the downloads about Can solid. you for talked game? organic guys for for talk being about that on And separately investment Arena Sorcerer’s Okay.

Eric Ludwig

DASH first quarter, time. on Diner two lowest of years. Usually, We UA so the launch, at like lot pretty I two month philosophy think Yes, we the in like I've I than a games spent launching last the probably used do mean we escape other we've the seen had environment term benefit because lower. any first new more CPIs are much -- like or at year. CPI it two looks the

So, of on and into because investment leaned we Disney further Sorcerer’s was that I even helpful Arena. us very UA that, for think

X, Phase get on into be breakeven then, we as to we're basis. that really overall managing title And an

fees, revenue minus UA. So, cost, bookings, minus team minus

in be phase into getting kind that's and how QX of Disney And so business. that we'll starting for be managing the we'll

Nick Earl

lift engage. well, monetization add It Hey, responds from a doing the beyond and the really that live Pixar or of obviously, Nick, with live movie about like is of things tremendous we're team's events. live in things ops many and operations getting to a there on this that. all what just remainder Drew, are see But for starting events really and well which, Disney that to year about And when that paired yes, guilds-versus-guilds and incredibly to challenges is couple The that a the perspective. and game all see We coming are I'll it's Disney. build. it's out

audience of to Disney one attract We organics hard that's So, expensive this know to excited we're know are the come by reasons future what like. always the we looks why is about an and can that strong do to really as in lifts shelter-in-place co-marketing most have seems importantly, we a start is once as be today's but environment, that And helping brand coming Pixar. well to and we as execute.

Drew Crum

And with the What you add recovery your Thanks. second-half? bookings to assuming XQ? One bookings implied in last some in is one guidance from Okay. in me. respect are

Eric Ludwig

right able that don't and situation. able what ad to we're pleased we XX% guiding seen XX% and purchases year, some rest about we've to growing, and over that And we're the last given XX% in now year. in QX right mean, at the I other that seeing strength guide it in to there of were in QX. are given in for QX our Yes. We app but want get at banner I'm very flat, be skis interstitial more of the QX, industry on folks of the

Drew Crum

Okay, thanks, guys.

Nick Earl

Drew. Alright. Thanks

Operator

Thank Cost from Stanley. of you. next from And Matthew question Morgan the line your comes

Matthew Cost

you're for guys, Hope the taking question. thanks well. Hey,

leading in about they into of mentioned point sort similar with people and the and lockdown, in moved spending where of money. I behavior these people, in April some of sort down behaving of early Are that's maybe late payers. about a in players believe implies the they're won't up of prepared earlier or have? and back-half the gotten well April, that prior into March into have they're the the maybe to up behaving had you as you seeing and retain of I probably way as in ecosystem coming to remarks a you May, in cohorts who've that any guess, come you way a payers in ago farther moment difference monetize, as kind and That the think well came So, this to

then can terms in spend you just you're how systems And changing more about the secondly, Terms game think a And Layman's little that version people impact money? four how going play what way exactly in detail based the that we about to DASH? a should just just and give of Diner bit should

Eric Ludwig

one the one Great, and the questions. DASH. I'll Diner Perfect. on two take second follow-up Nick first will on

any paying in demo shelter-in-place they are of of players we've in not playing earlier terms them paying we versus differently, whether terms and in later, they the seen the differences So, behavior.

to you game, XX player, It if the money yourself start play the in you start first players, to hours. or pay is first paying paying Our a reveal the session within you and not days spending like wait within seven Payers two. become

that for or to like four ones five weeks And folks lot organically so I in were or would looking a are say that three, download ago. this we're still the getting who seeing the week game from paying folks

Nick Earl

Matt, Yes. question. Hey, is the this Nick. second I'll take

can And the to over and lot hopes base. very moving be systems consume be by years if just what into or ball, and a is of about So, very really And a words think for we based of analogy elder got can Adventures and in you’ve a and And mean two would you got that days, be experience, out. you based. weeks game over can we game play good consumers then game other years system what come content the high-level that and year. delineated to will contents be you game. a heavily more, basketball, into wait or Diner DASH and release an for it is call content at game but over elder months, In do a what

just create to are But our our way move for more it every teams it’s to productive and to We have engaging games, one deeper more trying a for creates to of two, content all just because single base systems not consume just economical day. coming that’s much this terms as driving to driving of out, with us for be engage experience our for importantly more to players which content revenue to systems, and more also experience in is new EBITDA. in opposed way able the

these systems really go we're as starting features. that So, opposed systems DASH and And, building through around play to for is competitive of Diner play just consuming revolves sorts allow this we as all transition, to that to Design see with this seen game. the pure Home plenty tremendous improvements as to systems. games content mixture in others and KPIs content a of of And the they from transitioned other like and we've out

Matthew Cost

Great. Thanks guys.

Nick Earl

Matt. Alright, thanks

Operator

And your next Company. Benchmark question from Hickey comes line Mike from the of

Mike Hickey

Nick elevating not. you're sounded the correctly the hope confidence maybe to could on you deals on M&A a maybe done or I that bit up Hey, environment, just current if is guys Nick, good. on if of that did, sort curious front, some if sort you I update Eric, And getting you what picked of here? seeing more speak your confident to are little

Nick Earl

I Yes, two Mike. think factors, there's

personalities company great as and just a really position, industry, a to studios just for home. a that is got very in be Dev balance We've healthy engaging The studios the out strong additional potentially engaging got We've very team in financially there for with structurally first looking is to we're that out with a sheet. there, a looking join. Corp who

creative I culture And our the games. really first build can growth that part which we've given build would these completed is of to a strategy, that, say

we have now that think I out. proven

definitely there. time us for it's out and think look I expand the horizons to

structurally that a place we're in culturally is looking. to it of part be So better and

would a to Acquihire supply grow think to got think and strong really friendly in terms good the bring that to candidates. we're we stronger We're just that really just in believe you of nurture. into a second very culture. And really then part place right a see We acquire I'd the we platform. be say it's over the mix. that growth as years of a fit us go games, market for the Studios the studio for is We've [ph] building going is We games

brand lifestyle. We've the an casual strong as strong of And games a especially we've now, umbrella set with We've well. in the got sports. got RPG umbrella of We've Kim. resurgence now brand got in a got strong

the good So coverage we've got of spectrum categories. across broad

greater I would just family. life, the years the are ago, So studios the both company really there X.X as far of think part structure we position have it's as as kind in out where we love and for for of the that our that supply started of to well Glu

Mike Hickey

least guys asset? It Are with distressed historically, you've to Or twice in have of in you willing mean, you for are line can have been of pay a at valuations can value opportunistically, seems definitely sort extremely philosophy? that you just growth these game? Are confidence, up my assets sort you like buyers. I view. be something seeing that

Nick Earl

Yes. It's point. good very a

But, We're assets those, We the to good through structural not seeing are all out everything with you and are cultural think seeing to over, very tremendous fit think result out valuations We'd only comb that high tend of a we do there. want and there, do high and accretive. really look low. and find a valuations. to we had some but that have Crowdstar. just one another are they're to We partnership get love we

think can Corp Dev really right we got we've Fortunately, that the candidates. team ascertain strong a

answer of your there's a in I now. valuations yes, right variability lot mean, But just, to question, it's

pandemic of We see if come that there's the deeper some, have be that watching obviously a get into terms recessionary signs we'll given deterioration, factors that not there they as play valuations. into we and massive this environment in but seen is

Mike Hickey

lot how in the just me. to sort she sort little But curious she? resigned is how board, don't that motivated motivated how active? your to I her of a that walk nothing, very us to she Or maybe a And of course, ABCs many me was of of down I’m for Were narrative she of remotivated, planning inflected with sort And part overtime I’m wondering could of up is or And resigning maybe you business of contract? Kim from sort was got you her? in originally just with be came also question because, her? couple you it Last clean terms through very, went game bit. her a know. if thoughtful when success, on on just a just that. year where her

Nick Earl

about talking very the the been We've years. for we've three Yes. few This was focused something games. growth on that been last

think focused look where as on what was quite business a the we So, had period We I there strong future there. weren't knew like. a we

for years. for helping last a have a terrific with this and grow this Kim. being game She's partner great partnership five, We six

we ago, it for an where year think energy started the as we saw really tremendous And results QX, a really was about then to we QX, conviction But and we extension. just a arrived. makes extend in We a does spent and think candidate we good time saw And that a lot deal to go and deal is sense it where through though, the us. and it this for and of of both more. working had

And part discussions like feel she's certainly And the this. of how of in motivation, by tremendous all it But going that that's terms of big game. continue expand we it’s to be tone going and to opportunity a certainly, to mean, our her and out. I see tenor we'll plays the in intention a

anything we and more do well. can well experience amazed just content, and to are the brands place, that in frankly just incredibly engaging just feature And they set, to for extension it it's double attracts that the going got create on organics this we've love players, those enjoyable of really we and a We down now how are doing. systems because the given it's one

next strong years. excited So, the about we X.X onto very something we're like feel we're and

Mike Hickey

luck. Great, thanks guys. Best of

Nick Earl

to to you. talk All Mike. right. Thanks Good

Operator

question Doug with your comes Creutz the And line Cowen. of next from

Doug Creutz

think more penetration with What U.S. out portfolio in the able that very you that mentioned get the to as be bit there there break your you you great? a trended thanks. has Have other give to would can Hey, other in color do see much geographic Historically, call. Are Disney? regions? been and any you opportunities you

Eric Ludwig

Yes. Sure. Eric. is Doug, this

now that. outside seeing the mix North has Disney more our XX% America is that than So biggest the Japan. can't is diversified right we're say say of America. been that it's from revenue North I'd historical of probably country coming I

seeing encouraging. as very We're in very, very XX Korea Japan. that well. we're in that's top pleased So, is the

paid So, acquisition and user Korea, definitely expecting now leading in with what Disney we that happen we're doing were countries. to Japan And other is by into happening. as as well

long like we a so far, got yes, go. to outcome So, way the still

Doug Creutz

Okay, thanks.

Operator

line question of last Cohen from Stephens your comes And the Inc. Jeff from

Jeff Cohen

Eric, I down it well. Nick, year-over-year, Hey, you great question. hope don't because to guys guide. thanks doubled for taking per great I quarter just while like the had mean But a you and here cost guys a calculated install are X%. doing by are increased your growth looks nitpick

reconcile LTV just your just maybe that the with CPIs math might I then that talk but you in down? can the trended trended to has light portfolio? all maybe could broadly have just quick more Thanks. So, that, be commentary in of about how wrong, you CPI doing And

Nick Earl

sure. Jeff. probably so Design pause horizon. And our and higher environment that were Yes, last at Covet we a you're in for time looking around Sure, Yes, Home Fashion. year-over-year lower a we on CPI basis spend year, because

paid. right of into spend of we're basis, now So, coupled a calculation what a of with overall year-over-year is both the terms that's in noise seeing there's and organic downloads, some that and on combination

a little I’d say those year-over-year are a apples of kind oranges on bit So, and basis. of

second didn't And I second the quite capture question? then question, the

Jeff Cohen

and how around LTVs that has the Just portfolio? CPI in trended

Nick Earl

CPIs $X LTVs opportunity. added of million UA April. the XX millions a favorable of phenomenal, double UA then in advantage really to to June, million month certainly Well, is take $XX we've last think up we've going spends phenomenal of On down, In in adding the been which seen basis, and and combination the leaned XX have days digit we added a April, spend we're we I to May, the quarter-over-quarter in, incremental. Yes. this of March, coming why of why of month ROIs

is that from improvement of some monetization And the LTV side probably shelter-in-place.

happening. opposed I’d the that accelerant was only as However, an say it's to reason why

approach, lower with all the the like higher to titles was for monetization. of series. had boosting the April And really added a those and We the all favorable the Coupled also series Covet shelter-in-place those DASH engagement home Bohemian with items season CPIs with based going other accelerant Fashion of of an systems components launch. Wanderlust design other Diner us. spring

And then launches. and that really That's mentioned baseball, the year-over-year, the of far stool [indiscernible] two I quarter you so this leg was new up was XX% lastly, to-date the one which third know for Disney.

Jeff Cohen

numbers. on And be guess CPIs worse why that I on it, be to Nick, when spend why I squeeze impressive presumably wait one obviously I reason so would in quickly. wait? mentioned then if you than really make Disney the stepping shelter-in-place is it, you'd given baseball ends. could there sense any Got it think more would up

Nick Earl

acquisition, about be back with necessarily partnership more executing physically co-marketing Jeff what with and but talking them on consumers around now. lot I the not to rely was the we're various was actually, user going we having vehicles are use Yes, Disney. they in right places, that of not that A where the are

the co-marketing least or we traffic at normal be places until of in are and is So, many just somewhat right postpone going we had that to are they of now. these just where these of out some shelter-in-place, back to to allowed not

do just portion we're a So, coming of the players we going about about marketing drive to not it's It's game. pie, but acquisition. think into smaller one the that's talking user co-marketing, talking we're

Jeff Cohen

that makes Thanks, Understood. Yes, guys. sense.

Nick Earl

Good to talk Jeff. to right, All Yes. you.

Operator

you gentlemen, call. Thank today's and concludes Ladies conference this participating. for

disconnect. now may You Goodbye.

Glu Mobile (GLUU) 7 May 202020 Q1 Earnings call transcript