SLGG - Earnings call transcript Q2 2021 | Super League Enterprise, Inc.

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Operator

Good afternoon, everyone and thank you for participating in today’s conference call to discuss Super League Gaming’s Financial Results for the Second Quarter ended June 30, 2021.

Joining us today are Super League’s President and CEO, Ann Hand and CFO, Clayton Haynes.

Following their remarks, we will open the call for your questions.

Before we go further, please take note that the company’s Safe Harbor statement within the meaning of the Private Securities Litigation Reform Act of 1995. The statement provides important cautions regarding forward-looking statements. today’s will during forward-looking remarks company’s conference include call statements. The and presented along to matter risks with statements, for a other of subjected These are information this facts like number uncertainties. historical from those results differ Actual implied may these forward-looking by statements. materially earnings risks company’s reports the could to actual and Exchange uncertainties to and to more for differ. with and results recent that refer the release Please information Securities Commission the company’s filed about the cause available that I through for would be like call also replay everyone p.m. this remind X:XX will to Eastern XX, XXXX, on starting August at p.m. X:XX tonight. Eastern also A webcast as available replay at provided link in company’s the press will www.superleague.com. well be as via the release, website today’s on And the and. now, call the CEO like Gaming, over turn Ann President I to of would to and Super League Ann?

Ann Hand

much renewed growing for heightened today’s and of that as march Super and us for call, get Leaguers, you toward joining as you prepare we I hope sense confidence afternoon today. vision level feel new the time thank earnings I too objectives. excitement feel through a our and so for we energy. I call, Every Good a

believe media So can in first, remind us we here, why a all be to entertainment and Super ecosystem. League I the and why we gaming are juggernaut exists why want all we

Gen First, to of metaverse in the is hanging real. Z out real virtually prefer XX% the life. real thing

three with And than through disaggregation Content that TV ad There the the a built Fortnite. content, people the game League living social no Grande’s be Roblox Super traditional irrelevant large team of so a Gen ubiquity creator last concert their and and turned game spot that is Everyone is will The million fact preference was example these never Ariana is a blocking of back designers point, the ad making millionaires. attended channels number made on a has XX.X XXnd technology in be the in of prime-time economies. a for through better As case Z week young and streaming same. forever doing millennials. the studio trends. concert the even the live can result, creation into increasingly advertising of model as has democratized.

bolstered empower in-game we and we and helping creators in-stream inventory, metaverses, economies, of engaged with our brands elusive tools have gamers. by advertising creator We control passionate, highly audience reach

updates So let’s to our significant kick results. XQ some as XXXX strong in off have we financial addition

X, business to Meeting, and stack move First, Annual we the we way the model, receiving of to League offer, how our completed it. behind material Mobcrush June all monetize the and who support a Super from we transformational through aligned technology the perfectly is General acquisition at we target on shareholder that what

broadcasting of Bannerfy, metaverse worth robust marketplaces is deep and Our announced experience. acquisition is content The IP, and creator a and pause. platform both a platform other integration of capture, have Wann, key includes library. tech, ad and tournament mass the Mike highlight am creator consumer former us, with AI along Mobcrush and progressing, Mobcrush joining I functionality, tech, to participation to CEO gaming thrilled news serve offering a our to that Chief creators is insights Officer, advertisers. leaders, advertising today, to Strategy technology And our highly his monetization This advertising we more complementary and offer the as

has fans to into organic channels, brand to receive media native to integration and a many ad only in-stream While live allowing advertising Bannerfy inventory. The boxes. their as acquisition at enables advertising the this it premium scale X our partners. gaming but United Super who partner seamless monetize YouTube, to to first will base. expands our namely Tier distribution healthy brand mission path custom this team. streaming expanding already now similarly much immediate does stream. Super of onboarded roster join sales Great in and creators gentlemen, creator’s sponsorship size a to technology, two Not Based an size embed And a acquisition, and reach checks own creators smaller our international followers, of in placements pipeline represents acquisition advertisers and reinforce talented to and Mobcrush, their League’s creators Kingdom, for exceptionally also technology European video social League’s a the and digital, empower strong

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how Our lot acquisition a strategy company. about says we the run

build focused company with on equally We it formidable and growth, in position path cash buy a be growth, to gaming responsibility currency are use top our the and an that a for here to enterprise we tempting a ecosystem. of building take know to seriously, public line revenues, media positive currency long but We to to ownable use could our just any the enduring to distinctive, flow haul. any is you wisely each

wisely. So we choose

that and way we where get we’re to have The we walked going is pivots. strategy, and to offered execute. short-term to when boost on stay fastest resistant and opportunities stay to away We sense focused, complexity

original official of enables server, to high-profile annually, on, the Young Pixel properties XX such server formation and Minecraft registered as elevated Paradise, and Gamer advertisers Snapchat, America to includes unique Minecraft ever the Network audience gamer see over North can Gaming Logitech moving Gaming, stones League’s that Sound DTS Super ASTRO League Network have Minecraft partners first featuring by and and highlighted official our a of this crossing, the game of Minehut over been young brand host TikTok, in the Minehut, Gamers launched we gameplay Bedrock recently players Mineville, its sticks million featuring partners, reaching million Moose and number Recent community League’s under server partnerships largest on offering X shape, Minecraft you growing Toys, provide Space. Core taking with presence expanding media XX and Gamer to reach our playing, channels. roster animal gamers users, of multiple an Network, an Super today role and drawn Young awareness. audience, Roblox G Super levels Bedrock including include and also that prioritize series engagement Now on and with developers announced and platforms we

of which to a the Nielsen the gamers engage views. within we community. first League’s live All U.S. social Gamer platforms Moonjam Summer in reaches music Core Super monthly, years also XX to and digital of hosted band X.X Then audience them announced of with AJR stream the properties featuring participated Minecraft opportunities with annual the in the hub company’s to verified live Minehut, streaming company’s presenting Network, creators old, XXXX, XX including more across billion XX verified December than million notably of and Mobcrush, as events

XXX,XXX per the we month, of featuring AI titles. have most to generate many well, access gameplay popular world’s highlights As

League’s and TikTok, the as year-to-date We And League that more. core now that featuring amateur games per Framerate inspired Twitch, and that as League this dozen invitational network Legends, has media across we across million YouTube social Rocket a players, featuring delivering concentrated list more Arena, VALORANT, as XX series Bannerfy and user-generated of have popular Super spanning esports TikTok, and gamer video League than then and titles, views in tournament than And branded Super add to channels more such X month. which more semi-pro competing is million social than comprised Instagram gameplay on highlights, demographic XX of views well. top

Bros. to our to sponsors recent awareness choosing the Hyundai, XX and Gaming include League Super with ENIX, grow of Warner XX SQUARE engagement STARS. gamers through Some year-old Sega,

see, reach, most of offers results. As but the what our matters have products are can you KPIs, rich and a indicates we portfolio which with depth in change step and compelling

XQ. with So to that, turn let’s

Of go into Clayton some course, more here this with detail, headlines. will but are

XXX% a second in $X.X to XXXX. revenues Our up reached quarter QX compared million record XXXX,

all saw there our revenue across we a on in should streams as will in expand that balance moment. as As well And tied well, business more note game nice the that is new revenue of some in primary seasonality in I portfolio. to we distribution releases. the increases

second the So back-to-school QX advertising a typically in advertisers quarter with considered of holidays. year and increasing the half spend is winter softer with the

reporting healthy, our material to new within infrastructure ourselves growth our and absorb current continue and we to QX unlock remain challenge for margins Our XXXX, cost XX% savings.

on Finally, of we cash have XX, of and sheet XXXX, hand a debt. no $XX.X with as million strong balance June

So, a bit more color on the revenue front.

our business, let’s model. which talk advertising direct is First, a about serviced sales through predominantly

derived, see are As is where continue to lines. strong of the and revenues bulk know, we you our this trend

premium XXX most $XX repeat and character Nickelodeon’s sale example. end XX more to show, game won XXXX, from themed years years game time. optimize our holding over of deal TV a a and advertisers impressive XX gameplay to pipeline X-figure increased of million deals the and the Patrick great we included potential big statistic of is to campaign top celebrated Patrick X.X recently, CPMs SpongeBob has XXX in players, unused are activation the came campaign, advertisers proof series. out an visits over gameplay. in-stream work they the and display automate results, Xx sponsors, in build over we range. XQ with Star inventory. advertising We in over Again XQ, But general. experience here we from coming that Roblox continue an In gameplay a beyond of up video back deal equating Our launched to us. XX-day in XX-day popular and putting with opportunities first And from The since our tech to having historically direct stack north islands, And a sales, of for our $XXX,XXX. delivered our July, $XX size unique deals is and Star million of a $XXX,XXX. money programmatic that to the And QX are XX% game are in Probably our average

revenue our now a for revenue growth. up prior mix, on quarter, to XX% becoming which and of direct-to-consumer, part improvement, accounted Xx the XX% in from our material a of So

now properties. We have direct-to-consumer X

highest creators First, million from the the for recently for owner subscription active Mineville. server going launched or an revenue to the Minehut, our monetization, players enhanced leaning to micro beyond experience. with into dimension Minehut advanced focus second a monetization more owned property grossing home X strategy, date, and monthly on from ranging Minecraft creator players, prior operated transactions of insights one By gaming to our and and can strong leverage our products

on we our million As Bedrock official Paradise. is competitive And players. Minecraft to with Mineville, earlier, focused enjoying X third Pixel us leads newest an and property, consumer that attractive now experience gameplay Bedrock Together Mineville first unique active we gamers. server explained as on global more an is Paradise and Minecraft to playing X on girl and the X operate young so of it’s of focused Pixel inclusive servers Microsoft, official behalf server monthly role

in days the first revenue. just XX,XXX in days launch, XX early While over of Pixel generated

views the that people produced on the to content XX is year. video our our platforms, front, social this Finally, And have over content. and Super and trending we content this digital of across year creators. Xx are deliver community rights to what that are us League And of last enjoying by for validates that billion we

from it’s technology We revenue the content in course, live, Cox to and service, of value. delivering its and But for a we revenue have represented our few. a opportunity just to about our revenue offered spoken Virtualis take studio League market XX% with Media expect Snapchat, partnerships X% to material broadcast through to And here. technology, high-end itself of additional prove can remote of growth mix, the patented pandemic explore as in and channels emerging content the nascent cloud-based test Transmit.Live, This as early This fully an so where represents harrowing library proprietary Super distribution creators stream, continue as a about space Mobcrush’s into can we up Virtualis gaming-centric name mix are ways a delivered more our it prior and very a revenue XQ. process, storytellers this and our integrated this our not world-class Endemol partners. proven And so gaming progress cost exploring ways beyond us people help We down tech by kept highlights and Shine capture as them to deliver service be chain. safer the monetization the production also and our is build made we in Using we kept the the at home with goes off the food broadcasting streamer platform. LEGO can layer TV of a quarter Masters. AI-driven them only that additional to savings significant company but continue of entertainment media to tremendous monetize our and last to Show stack, partnership esports, a further and multicasting technology, our

done. in but course, certainly Mobcrush. there’s Things we’re period running stub lot smoothly, be still recognize of We a are some have a with wins. optimization I early However, of to

based So for are back, than really is we matters as most leverage to what looking begin rather combined today strength. now on we us, looking forward our who

formal give we revenue we my don’t of appreciate my general back the of think we perhaps pleased. in on while XXXX. the can But I guidance, second market be you So million and investors $X will half thought million. at sentiment half I best $X estimate, even $X deliver In our the year, regarding the million, believe might

hope script write will provide goes of fun the we back with Haynes, strong, which I Clayton At to an to this our can half have turn enthusiasm Clayton? good I overview printed financial closing year and and some this it’s this We to a you and quarter call our year’s like which our back point, will on come Company who for results, in remarks. really over XQ, quarter. a after why I pipeline performance second feel into CFO, earnings I that will the is where the never sight started. has line sense of history,

Clayton Haynes

I you, with how fully acquisition, to Thank afternoon the also have to team. like Mobcrush and Ann excited of integrating continue are we everyone. process good are we express the closed to how Mobcrush the excited and would

a move begun the Ann combined synergies already ecosystem. and mentioned, forward see gamer have creator As as we in force to as we

transaction X, June XXXX. acquisition Mobcrush the on closed we reported, previously As

League’s an result, balance another Super in related with of along X operations, Super quarter recorded a later financial the and accounting of related include consecutive my Mobcrush for League’s the second sheet month XXXX of XX% acquisition summarize first of quarter revenues impact revenues, record more we see XX% revenues up a we other XXXX. increased of entries revenues quarter I related continue significant prepared approximately operating quarter gross overall record and of compared quarter statement compared quarter of summarize to the revenues increases second strong of month results, results remarks. we including As with the primarily on of tripled second margin due second in across Cost To to approximately X to bit than fourth streams. quarter Mobcrush top expenses, and XXXX revenue quarter-over-quarter revenue to of second in revenues XXXX our primary QX which line XXXX, of as of the will our quarter the increase in XXXX, and of posted results the XXXX the X

of and XXXX. contribute up we periods. $X.X consisted Our and of property to XXX% of digital the comparable primarily quarter related the sales sales prior in Mobcrush digital X $XX,XXX direct additional accounted XXX% approximately future of sponsorship accounted loss in costs, expenses platform increased in into which second included XXXX advertising leading monetization including higher of year sales production revenues XX% and for to generated advertising revenues related revenues. related and quarter year the deeper content, to display second of in to little increase XX% compared for quarter the costs, revenues own XXXX. esports XXXX, of revenues $XX,XXX content for the Minehut and increases reflects of of growth gameplay programming revenues digital gameplay compared which XX% year and operating revenues advertising and and second the for quarter year our Advertising approximately partner to InPvP approximately to higher our in the which original month is the from channels. our to expect million and advertising driven as revenue of the Content GAAP was inclusion and for broadcast quarter. in of strategy year programmatic and to Mobcrush’s second revenues revenue XXXX with licensing XX% rose advertising quarter prior including $XXX,XXX in of includes distribution and technology, channels Virtualis sales syndication revenues a revenue XXXX is month our the the sales sponsorship due entertainment Mineville creation comprised The of XXXX. to as of were content quarter and Mineville goods primarily revenues highlights digital quarter Content stages compared XXX% revenues in of and with potential revenues of prior online in XX% goods year year direct to and reflects in the the results, quarter. X product to compared to the in revenues quarter afternoon, approximately to and inclusion the in parties also sponsorship sponsorships, costs curation second quarter and Mobcrush includes prior prior the sales, to in its selling XX% the XXXX. upside XX% strong of in the video across revenues, quarter. the of Mobcrush by of second earnings and us provides quarter revenues the content compared subscriptions that revenues increased for user-generated compared of and XX% incremental compared connection content G&A our increased in of of three marketing sales revenues second filed technology. of this to direct-to-consumer when This for approximately for and increase direct-to-consumer Direct-to-consumer the of $XXX,XXX primary quarter a our and to the all second increase remote network prior over infrastructure entertainment compared XX% quarter quarter Mobcrush’s $XXX,XXX, and release Diving second prior and streams, third operating acquisition, summarized of content utilizing early content, our media sales and revenues, significant of $XXX,XXX

The cost the cost was of increase quarter and incurred for we we of onset in cost inclusion impacted the the quarter the line of second XXXX. $XXX,XXX compared in revenues revenues offline from of driven of comparable year quarter $XXX,XXX X Second change also primarily to of quarter. in second to of cost of due of response related top the revenues to by second which pandemic of certain to by revenue XXXX Mobcrush for revenues ensuing shutdown. quarter of increase The prior XXXX XXXX. X% cost of XXXX, revenues in related strong in lower contracted in quarter certain was was month revenues the in second as was the COVID-XX transitioned actual increase lower the costs online of projects in in cost the activations

As the profile cost and content period revenue on experiences of revenues previous the each in contributing our related based noted fluctuate and specific of occurring cost sales revenues and and and entertainment period-to-period period. each streams advertising calls, to focused on activities programs media esports

Mobcrush also charges share charges million interest revenues, in costs was future technology transaction tax to services well second due which comparable Non-cash includes advertising in of platform to connection compensation driving costs second incurred costs. compared operating general sales, year transaction increase non-recurring charges $X.X in The XXXX increase engineering loss sales due amortization prior costs for increased increase as a of asset and net totaling costs was the a legal, and to The net intangible audit, credits, the as the share Mobcrush quarter comparable technology be in in was acquisition connection the costs quarter of the and in increase of incurred. closing of were Mobcrush to the in Under acquisition. to quarter On increase the monetization $X.X and in of Mobcrush included per quarter. in loss as acquired assets talented XXXX The for related extinguishment the acquisition. stock forgiveness increase a $XXX,XXX, quarter Act. related expense on to quarter. compared GAAP, the an and PPP related with and administrative the XXXX. $XXX,XXX expensed marketing related period as basis, the increased solicitation Mobcrush acquisition-related acquisition change of are including sales primarily with well cloud in $XXX,XXX Net to the in proxy $X.XX related platform $X.XX totaling to an reflects under and The and non-cash and expenses U.S. XXXX technology intangible in required personnel quarter $X.X expenses was financial of million support or other in loss team. the per GAAP in impact and of infrastructure $XXX,XXX or to the second of advisory, XXXX Mobcrush expenses of the diligence Second to million the CARES personnel as $X.X connection and accrued loan million loan with gain the compared second million in May prior the received year forgiveness $X.X previously XXXX acquisition-related the

against statement benefit of assets. In portion League’s our tax representing resulting pre-merger tax operations in tax of benefit net $X.X addition, a assets the the transaction, acquired the the Super as income which application of released, to recorded created was was million, source to acquisition-related second XXXX. quarter of a in utilize in income on allowance tax existing of and liability, liabilities credit of income with the for Accordingly, valuation assets the method deferred acquisition deferred a net tax non-cash of net net the Mobcrush merger, in tax the connection deferred accounting the deferred for a

fluctuations the or credit, $X.XX to compensation and our quarter. earlier. reflects $X.XX year stock non-cash relationships gross for increase comparable prior in and revenues related forma the per other million charges or count weighted share change share described line Excluding and top the was and net non-cash million and the The primarily diluted profit in average $X.X $X.X quarter-over-quarter charges per expense pro share compared loss The of quarter for XX.X second average the The of quarter the the issuance former million I weighted stock XXXX. share in the million to second merger common which was Mobcrush to quarter the of million the XXXX second of diluted shareholders stock X, reflects company’s shares compared earlier June X.X of XX.X mentioned as consideration for of closed count as common transaction, XXXX. all XXXX on

our calculation financial pro of contains more with net as As forma SEC well disclosed loss X-K with as with results. can use that loss investors Please forma compare in measures our measure pro prepared and financial in earnings U.S. earnings income or net release forma a description filed of we detailed accordance that the most and note the net is our release this a loss non-GAAP afternoon, pro reconciliation comparable a directly of to our GAAP. evaluate believe

cash, debt as of in Looking sheet, at $XX.X $XX.X no we XX, balance total million. June shareholders’ XXXX, of and the have million equity

Our in current transaction monthly the OpEx acquisition to million is and our to combined burn stand-alone impact a range costs, rate integration to of of $X.X on be on burn expected $X.X million million million continues the a excluding basis basis. non-recurring gross and $X.X net be Mobcrush $X.X in cash rate the cash monthly with range, the Mobcrush, to

for brief XXXX. and accounting of X-month statements a of the the our the summary period provide financial on ended for acquisition preliminary as I of June Mobcrush wanted XX, impact to Lastly,

and and required, acquisition additional $XXX,XXX back in years, the merger QX the solely value standards, the remarks. accounting estimated method for do X in included and With $XXX,XXX June being for foresee consideration look finalized material results are As the applicable approximately technology of with joining X-month you for in resulted acquisition period our although the were accounting, call XXXX. over connection accounting Ann? in of and develop allocating lives stock method for range related million. transaction the we in established second and of million with in accordance today, not guidance acquisition consolidated issued our which and Ann well including Mobcrush are identifiable at acquired, was trademarks. preliminary all price, acquired be general will influencer, the Mobcrush Again, goodwill, to to estimated applied X-month expense XX, stub advertiser, results merger assets for Mobcrush, and acquisition to $XX.X us of administrative currently, I Application to XXXX the and which and of shares in partner, This being from of transaction. the The method the any relationships the application assets resulted period to with of the earnings to for amortized we comprised assumed XXXX, connection the purchase $XXX,XXX, you fair useful quarter Total non-amortizable as some X with of Amortization XX.X changes. the the of intangible I thank in forward assets acquisition process over also customer liabilities common as of ended X respectively. call. costs related that, the will totaling to intangible of $XX.X included the estimated turn plus acquisition million

Ann Hand

Thanks, Clayton.

and content them media happy to our leverage careers that technology. metaverse, are and community I to are streamers our expecting to stars. to and tomorrow audience a technology and social that And influencers and create empower grow in communities. them each and take your expand players Keep through opportunities to expand with our and We to of gameplay, believe the esports our Cindy? Our us remains further today’s role questions. advertising their entertainment that, other and Clayton aspiring mission the leading connects gamers build content reach and to

Operator

our first Buck. line comes Instructions] from [Operator Scott question of And Thank you. the

now open. is line Your

Scott Buck

Hi, afternoon taking guys. good questions. you my for Thank

First, jumping over on am you I gone so I few call, these, have want the to apologize I again, case forth a apologize. in between already back and of

little should about year? a remainder as more I hoping bit line we First, item quarter. And move margin was the the What could me in gross of decline? sequential the that how give on through the think maybe you drove color we

Ann Hand

to as Yes. Clayton XX% happened a was partner a in Tencent circumstance great a in let there had events. real-life said I’ll had being with arrangement that one-off – XQ problem. of well, is, an jump we Pandemic of of in but bit still host very hits, a certainly we last no Tencent year healthy. because think, We do a

deals them doing online do was the Let’s lower. much instead. Well, those profile cost of

able of to, for and on gamers of from cost that because the the the reached home. the achieve same X.Xx we number it, profile, deal, the could X.Xx really comfort a lower top of of to of we join their deliver everybody because So higher-margin were value much program,

So advertising. participations But still direct-to-consumer kind our of campaign content, of between where have than chance more said, the to achieved revenue the much in mix it expected grab that was and in we a deal. got events just really now balance greater a a number high-margin and a we

knowing fluctuations revenue might portfolio looking I range fluctuates. so one guys staying do And you expect that would of those that at is be healthy, minor a margin as of there that but think I quarter-to-quarter, things to be

Scott Buck

haven’t may I’m just just new space, Great. guys for curious getting pipeline. And maybe me, previously be the space? you second who that advertising the into into advertised either anyone on then you’re of seeing kind industries the That’s helpful. just with whether esports one any or entrant

Ann Hand

gaming-centric about absolutely all, we mean, because esports, broad so do well, really question I entertainment offerings also a we umbrella of good have but a first a we that’s have lane because has competitive have it’s to have as been of still their get to anyone young [Technical advertisers, audience to gamers, to or parents. of We diverse who in. draw those on to Difficulty] real esports a but advertisers Yes. wants back to speak mechanisms still

is what broader we So I said, the to a affirming gate things that range just we speak really in much spirit stands common, that the had right esports so much advertisers and the so strong think of of sales type And one elicit, while felt brand was extremely that we more was of a is broader what cannibalizing of pipelines. than for of we and both consumers much we types merger just content property, What traditional entertainment. the compared real foothold complementary We in each and found set so a Mobcrush the the But the we that have was, weren’t we verticals. target with that out across the similar pipelines. other. of of

deals. But you there releases you people and at sectors at strong again, new that when in and a that doing some look really Netflix chasing lot But and the entertainment, Mobcrush was like synergy. then So weren’t of weren’t as we Disney+ same was that look much. we

when that’s very to and kind we revenue had real for strong we in to that that categories So we getting whether And really but But a foothold positioning, or there. releases, very large work title where obviously Moose out and foothold closely game publishers of specifically new Toys. helpful. they with game. strong And for ASTRO, specifically, game there follow-on then a game in their Mob felt automotive we our some – the still, when so new it the have Lexus, you chase Toyota, then like that and is be Riots a I that We about just that XQ endemics, the investors, and Hyundai think stronger at is another toys inked $XXX,XXX – the new look had deal automotive. was I really talked and Mattel game use-focused is more world, and had release like with that area Logitech of very like tied a release, Tencent

on narrow in gamers. that and pyramid, are the about to mainstream esports products was and that big of at there more to pretty I think finding pretty who level. professional a we’re find hard-pressed isn’t with think complementary are that how a comfortable I interested segment general, you getting – excited a focused of because So group given their uses I’m it’s But the gamers vertical the their base chunk is

Scott Buck

of One kind I’m with anything the surprised back curious business umbrella you’ve months. surprised is Curious helpful. X.X just for I’ll more with as been into under jump that if pleasantly Great. Mobcrush in now you’ve general for in there or integrated and That’s you’ve very me, about the queue. yours? that had

Ann Hand

the salespeople. Mob team merge came then months, be packages, you couple and a cross-selling with the because Well, to I really I’m more two group just reach. super and the that think of all with about when is much properties has team of our mean these gate sales just the of top-notch And you and so companies properties – team. out just and making with I proud when larger larger together the of mean, get mutually it, these sales able really, been there a bring, in

advertising is heft. always we’ve all said, As about

matters. the revenue roadmap I’d that the with element, the so really can of get thing Mobs to off M&A, of technology can’t sources I Virtualis, It highlight everybody haven’t scale, M&A tournament conversation. we because we scratch new it selective functionality say capture to to time said it prove a every on mean, more say a why stacks palpable, softer we I’ll at when because put even business prize share that’s we is have is a types the say think may quite tech last it broadcasting, even you other opportunity. the of look but there is that bigger we of so It’s components a is can the then behind been this product of could yet. that And our together, the I early. multicasting we and be of it. need see can wallet. two driven a at the But the when is look is and surface advertisers’ models really And of the of AI, would technology, you I you and begun there broadcasting tech those emerge. Super of League that call, – out excitement, synergies see I we’ve the digest investors too, that this lot on much what

the anybody close to because very against we to was for we’ve part quantity delivering call, in said And relationship and a long-standing from results I better is are stuff. known X The had what can than really them. years the as beginning buy knew Mobcrush executing together they we apart. hard are As with it

where feel can you and that’s more side for we for us on the just for of the is just very the personal teams of bit of lot of of so going am still kind an indication know sadder more company and a the there been the more it’s to And get is learning I’ve how have that, where some on battle believing, half optimize, begins. it this the has I right? like to as And jobs other, ahead part offers, as so to is I this while toy powerful fit lot a work in little got and about And start I the M&A everybody’s I time me of is hope after usually, won, as the a feel, fun big culture work different a half really all bullish of second light than to each guidance I – a And apart. said, desire been together. box, of think of all It’s the more of toys energy be. think smooth announcement. about I do I’ve together to think the kind each kind harder other’s giving we because year, And that

Scott Buck

appreciate the guys. I helpful. Thank time you. That’s

Operator

And Aarde Maxim one Group. Vander is Please Jack proceed. of next the

Jack Vander Aarde

mention it looks of plus Ann. Bannerfy, that A but $XXX,XXX you first Hi your is, of the acquisition Mobcrush during My Congrats the than comments follow-up we then average Xx Yes, also Average my opportunities into and after finalizing this Clayton. third also you earlier ramping won of of $XXX,XXX deal not XXXX. will mentioned your like and on order gut Is of $XXX,XXX questions I accelerate then order more up is the order Hi sequentially. only have from around advertising morning. acquisition is you in shortly imagine size segment. are Mobcrush no. dig me continue, now. me into tells fair is and I acquisition. another there, would that pipeline size that just And believe to I this question on a this your heard the you couple like coincidence trend first quarter I a assessment? a that won a

Ann Hand

we that Mob, is saw to Yes. What I repeat what would say saw we strong is buyers. that prior

like put done to work Moose to you now advertisers continuing with has activations with want us. a in saw Toys, the Super that top-tier few League sense money we had So, to who

service we of So, to they a ad their but only were able percent kept coming back, budget. smaller

at that you have, when to to that Now, $XXX,XXX comes we are able when that we up of look that bid $X scale RFP budget. in, million

to And putting together. of so the directly that is absolutely Mobcrush and power related Super League

Jack Vander Aarde

Excellent.

this direct-to-consumer business but up Okay. revenue just XXX% over I segment, a then small to there. off appreciate the XX% that is switching the of gears clearly, or base, year-over-year, a color increased mode. DTC And hyper-growth

terms the back subscriptions, recent you then Just you in-game can there? where specific micro color provide that, drivers anything ramp are, additional see this a in the on what DTC can trending in ‘XX? of provide this you of couple of questions revenue on transactions, underlying And half else

Ann Hand

server. that part Again, one six majority coming Mineville, Paradise cut operating the maintaining Minecraft it Microsoft. it game Microsoft revenue for Yes. marketplace. off only designing a the right micro acquisition. there then are And of now the by The some transactions, of was – until property monetization was Bedrock Mobcrush transactions receive a servers and the And is and basically of passes up of operating sponsored launch, globally, is official which primary that that through that Pixel we in-game is or fed

of a And to server, a this targeting so Minecraft a were by kind player. of that second type Microsoft launch different we it’s asked significant Pixel Paradise, one, thing

approved And theme fact that software But basically back the is, of how of mention gameplay. on basis a so of on young user. we, play who at for is Minecraft well as a really tablets. and delighting a monetize the a this And servers global like the the significant for consoles think, I Mineville Bedrock pat should players done I kind different company the Minecraft or of two seven control to team Bedrock has bit

And targeting server hence, specific types players. of – the so it’s those

Jack Vander Aarde

a more half me, just of percentage informal of this just outlook follow-up Super second Core Mobcrush a it’s reasonable as the had the segment it, whether formal, target and as in second you revenue as this well? around further bit given to month or Can the changes maybe it’s so your revenue like other one by between then well, mix so million, for sounds revenue perhaps break it revenue Great. any you League more. only for in million think or just on out $X Mobcrush’s expand And comments, quarter $X that

Ann Hand

have Yes. into I our I out we play mean advertising would say revenue. to see continue that

League the going us take package that going one to and core we out as advertising a But primary on age as of we wouldn’t we between So we properties want, size that pitches to are are stats we especially average in revenue are the this, say release stream – the see. pitch you old put can And still the going that taps about all best would front, you continue of I and although will there Mobcrush, of old really, hard are those what I is size young you think going have do those. splits say tell and line company. pipeline, is do revenue really stream, gamer you because that see to to, press we of you our – diversification the deals, advertising all be to into will what kind very forward, I be it pitches together. I I gave today that the There like Super I will able see are that have

XX that over let’s that gamer. core So, talk about older gamer,

RFP to platform their an by if their YouTube to we are offer offer for of using streams their an those in going the people and to way, ads comes offer, now them our the opportunities inside influencers of to to channels. ways creators. brand, Mobcrush stream also are banner the Oh, going we into going to advertisers streams social are to put our put automotive We Bannerfy advertising

Instagram going also primarily which give historic to brand, TikTok. our of set are user-generated Super opportunities Framerate, advertising which is are and League is on that We a highlights them everyday

is way want force illustrates it hard our start happen my that’s of assets. months we possible – important getting old So, Mobcrush, to we the only one in, because way why the of take want we the that’s all delineate with work the a think to personal though just and the it, the the to tapping set that as giving to it’s it’s using where as into was of assets going Super is We old year already soon want really are of We that League kind in. to as properties it right. – and between two. amplification are two that’s getting kind of are I as kicks the we And where team – don’t to the work one estimate even and

them. next, I marching are investors excite delivered think we but the and of a we they us to ask to going I we that’s $X but if going think know the And are towards when the revenue, you have break-even. on I second great so is half what are And million, said able of are half. got million breakeven. it want cash that, think early I year, flow in – what top my I that more, going first if couple investors KPIs, want it, are $X which giving that, to I deliver means about in for million is to believe we heavens, you line. do to And Well, short to because to

we type keep our have grow good nice I is – is and keep the I so model and healthy, and We that pretty costs, sake the margins growing, not for for in. And right. the XX%, but we controlling business do significant are think, line, the I top of we way of not

the call by $XX $XX are we we million, feel invest to to a flow $XX it, hitting, growing that keep in million, million, positive top time cash moving knowing So, smartly into line are the sustainable we costs we start position.

So, line. But and we rally breakeven would that both. we the the company. for at line is right the the and with top me hope of end prioritizing one correctly that of young of are are argue the agree we it’s would day, chase the sake top that say cry I shouldn’t investors I now. on that

Jack Vander Aarde

going on hop congrats I back am Thanks. to queue. And in momentum, the Excellent. again the building

Operator

now concludes remarks. turn this to time, Hand call our this Ms. session. to the closing I for question-and-answer at And like back would

Ann Hand

a we moderating. thank well And as in we you Thank you I like thank Okay. quarter I We to guess Well, November. speaking joining us. our to our appreciate this, look you, as upcoming to everyone would you for really listen, first have of Cindy, with conferences, would for when say remember results headline, all, for and report gamers. third forward if just anything, today’s listening it. remember call, we at I got

Operator

Ladies and gentlemen, today’s call. concludes this conference

disconnect. you now your Thank You may participation. for

Super League Enterprise (SLE) 13 Aug 212021 Q2 Earnings call transcript