PLTK - Earnings call transcript Q2 2024

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Operator

Good day, and thank you for standing by. Welcome to the Playtika Q2 2024 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the call over to your first speaker today, Tae Lee, SVP of Corporate Finance and Investor Relations. Please go ahead.

Tae Lee

you earnings us Corp. call thank second for and XXXX quarter for everyone, for today joining the Welcome, Playtika Holding

me deck our may some Craig today CEO contains call like and to immediately Chief on website, Antokol, that are I'd to our Joining on and These which today's you views this after Co-Founder of undertake discussion prepared Financial post are Officer. of of forward-looking applied representing Playtika's to today, Abrahams, statements Robert Investor and information remind as non-GAAP President contain measures, forward-looking and slide Playtika which statements you the beyond in we'll rely rather comments including, control. are future and performance. These operating but also not revenue the future call. and of and remarks obligation risks not our statements, forward-looking to guarantee We and subject limited are future. other these call. We've no uncertainties, posted anticipated performance, following should statements a the our to, but the accompanying on company's and Relations not update them an statements

of filings and over that, the complete please see uncertainties, our Robert. to For more now turn a with discussion With SEC. call the risks I'll the

Robert Antokol

to morning and everyone Good for joining today. our call

maps and road important that this note the to have quarter our is our review it we with historical results, As seasonality quarter second set aligns we forth.

and and the the initiatives boosting of are on and focusing our strategic quarter potential portfolio. some we challenges, games top the overall reflects our While revenue road for map our resilience our

our believe operating direct-to-consumer on categories franchise We titles. on upside to observed in there in performance has expense and to with strength margins Bingo a Starting focus headcount consistent approach and quarter-over-quarter year-over-year our largest still disciplining revenue Our our solidly slight remaining. our performed Blitz we direct-to-consumer and decline. basis. led improvement business quarter-over-quarter with a and is strategic other

our continue and We new the keep players engaged game content to the enhance excited. to with features and

been the focus of decline the in Slotomania has Stopping a major company.

team future but to will enrich we Our these our that plan new driving some second are Wooga latest the drive in summer. partnership dedicated which the roadmap first story another game, our Chronicles delays announce experienced features future and Claire year this player remain excited planned to and June's I'm in titles half features growth. optimistic launch to of from new Journey about as half, bring is experience the we of XXXX, is Studio. QX the that launch to

Our players, team committed at with content rebound delivering and our the at ability and resonates we to Wooga that studio's to engaging high-quality, perform strongly. are confident is

Coins acquisitions, and and Additionally, our the of like performance X. of highlight would recent Animals I Governor Poker to

with We studios. since the Poker growth both consistent are progress of increasing quarter-over-quarter Governor the pleased of shown X has acquisition.

about offering invest continue to position. in improve our and Animals optimistic growth opportunities for to our We broaden to Coins we potential. We're the are actively and game and looking market for

our complement long-term and that existing is value. acquisitions focus Our games find to drive

profitability. execution on sustained our and remains We strategic strong. players and and ensure are steps We our shareholders to to taking to value focus committed delivering growth remain

continued coming to that our more hand Craig We will for quarters. our support. detailed we the a path are will forward, our confident this for and past us you over quarter. success I Thank in for believe in position review strategic your performance initiatives for

Craig Abrahams

good Thank you, morning, Robert, everyone. and

of would financial Slotomania, like the results, our games. oldest further into of I into we to some provide insights our in our one recent Before dive initiatives and largest

social the casino the Slotomania positions industry. as #X consistently research grossing in game Third-party

increased category. To oversight. provide our years more share performance our in we we spend have CEO we to a marketing recent lost have this we However, in competitive as direct and team have challenges highly executive market decline, structured faced leadership counter

enhancing pleased new ongoing a real-world I slot us themed As across Caesars our commitment content initiatives, of allow reflect and as and Slotomania, Casino. well am integrate licensing into to Fun Slotomania franchises. supporting other games, This deal our portfolio part of our to These compelling our content moves announce our agreement with will themed House slot as growing stabilizing strategic IGG. to

in last to the like and which are our expectations, titles would quarter, and Governor been game Animals of economy continues the from I second challenges to experienced Next, game. performance Poker from performance year. since with corrected. acquired in we Coins some the in pleased perform our line X of the We address with has

the has We the of positive this earnout. and position quarter, continued we to into for the best to amended this terms trends see year are on momentum positive To QX. studio cap the spend the maximum long-term of month-over-month pleased incremental lowering game growth dollars the within while marketing earnout the

Turning to results. financial our

down direct-to-consumer generated revenue, sequentially The a positive quarter, spend sequential of and had in the as business X.X% year-over-year. impact on of and we the growth generated income as up X.X% $XX.X XX.X% up XX.X% of million our EBITDA million, For year-over-year. well down decline $XXX marketing we sales and X.X% million, sequentially adjusted adjusted credit XX.X% was EBITDA $XXX sequentially year-over-year. Net quarter margins credit and this past as

year-over-year. was from $XXX.X strength million, Solitaire we generated in continued Grand and X.X% June's in year. Bingo our and see this growth the Harvest by ramp-up the we with led second and pleased X.X% half bloods the platforms of sequentially past expect as are to Journey DTC We up direct-to-consumer quarter

casual Blitz games was sequentially and sequentially down Revenue X.X% million, Turning X.X% year-over-year. $XXX.X revenue now X.X% to year-over-year. our across in Bingo quarter. business and X.X% declined results our the

once Bingo grew double digits Blitz Our year-over-year. revenue again direct-to-consumer from

directly by game sequentially was potential $XX.X June's impacted negatively world, bingo studio revenue for last is of rest industry-leading its the launches Journey strongly we and quarters The has the the about performance believe performance. in revenue map, the for As year-over-year. some impacted title. franchise. growth track half with which down time this road the up on #X the studio this the development in June's X.X% lines, X.X% challenges faced and second few year million, outlook our the been optimistic revenue in for Journey we future for pushed remain future and

sequentially Slotomania Our declined social $XXX.X down X.X% X.X% revenue was X.X% casino X.X% theme year-over-year. million, and games sequentially and year.

We are and on through are players targeted as pursuing such dormant opportunities initiatives focused agreement. reengaging our licensing strategic new also

declined largest adjustment of XX.X% by expenses and due Sales related year-over-year. decline revenue newly expenses items expenses between as year-over-year, the platforms overall in XX% sales spend well favorable in by On to increased marketing P&L marketing to our in decline acquired incremental growth revenue our in G&A and the X.X% compensation X.X% related revenue direct-to-consumer Majority contingent year-over-year. marketing second Cost performance increase in and to The and expenses decreased Turning long-term sales and payable were G&A and in spend in such by increased to our Bingo The a year-over-year revenue. R&D studios to basis, a quarter. slightly year. Slotomania. Blitz a spend third-party marketing marketing driven considerations. expenses of change primarily and due cash program now as mix in and of specific by revenue line platforms was year-over-year. increase as for this declined by the titles XX%. our lower was accrued sales sequential a

cash, billion approximately short-term and XX, As of had June $X.X equivalents we in cash investments.

year-over-year operating X.X% our million. X.X% to X.X% DAU Average and DPU X% to increased sequentially X.X% declined metrics, year-over-year year-over-year X.X% $X.X at sequentially and average Looking ARPDAU $XXX,XXX. sequentially and decreased to $X.XX.

guidance Finally, we to within revenue end range middle EBITDA for credit the guidance. expect revenue bottom the the the for and range be adjusted of of

We take our your we'd With $XXX to questions. million happy to revising for capital $XX the to are year. be expenditure range that, million

Operator

[Operator Instructions]

question first comes from of Baird. Our Colin Sebastian

Colin Sebastian

can issues just like would or you social and game Maybe the How up obviously that specific to and some is on evaluate that Thanks. say factors plan, the separately performance much launches, plan, then much of and the there that sort you to as sequential the capital take Or new follow And M&A in of prior of macro separate funding with is the marketing Bingo. a performance between seasonality? at games versus strategy? just I consistent to company if at overall it shift of strategic of marketing my then of in kind games? look casino is how would sort related be allocation relatively declines guess, any terms game you new follow-up question is way? still out of that

Craig Abrahams

some at is Thanks, we QX. look you look from QX prior second at seasonality there the Listen, if Colin. to quarter, as years

X has respective #X top focus that been franchises our in their Our categories. are on

seeing our opportunities new continue just there bolster about talked positive our other was bringing we X.X%, like a at the Bingo that studio. strategic Blitz content focus lot grew marketing into that new biggest our digits year-over-year. licensing into franchise. double confidence you We're year-over-year, title. We'll look as with Slotomania, slot initiatives believe in Within have and largest flattish on agreement, QX title well we that direct-to-consumer stabilization as we've of but real-world really well to as well on down there, so quarter, as focusing trends as title, that a

QX the of look year was that we're ramping we from first looking to half of the some were their business. at future the delayed the June's Journey, affected second at As and by also launches year up DXC half

franchises. overall, the And think handle at think one. to focus I continue games biggest I -- that on as I'll look new growing the initiatives, So let Robert we we

Robert Antokol

still you M&A. ago much more in on is the this future a took growth. We for the our question. think M&A. the focus to We And decision. ROI strategic Thank is decision believe for better We quarters few

of a of have game. good our the launch creative. we hopes always we for opportunity with and Wooga that innovation, have lot really in to the said good an is we portfolio. amazing studio It's game, coming different And a Studio a However,

strategic when very on opportunities, changing So we are good it's our not strong we going decision it. see but

are we about future. really optimistic So the

Operator

to comes us next of Crum from question Our Stifel. Drew

Andrew Crum

Okay.

believe week On And you IGG timing free-to-play related to note, titles. the sweepstakes social us can a features competitor casino the that on of having then whether casino the guess deal? I the content effect your as Could or you earlier category. from category a casino sense the impacted a it's on integrating give is comment this this? is a suggested what you games, And on negative licensing

Craig Abrahams

Drew. question, Good Sure.

content Fun in focused new because year, new Casino. excited House terms of getting that and end into and of this content, of Slotomania, goes by the it Caesars year across about So and next we're live we're

market our market. in slot that grown terms a has across the referencing So into market, sweepstakes themed of portfolio. multibillion Listen, dollar

like gambling product. think it's to than we necessarily product a product looks a closer probably about As what social gaming that

hasn't us to the had some a into that a necessarily it's as that's market market adjacent but I substitute, grown see don't So hard to on multibillion-dollar impact say market. that's any

Andrew Crum

Got it.

Okay. that quarter, was acquired expected Craig, the mentioned uptick in think you the marketing you And performance studios. majority you the the And suggested recently of then, to last spend related I as the your year-on-year of balance increase second XQ. year progressed. this half to expectation into saw We still the moderate move as you year? that that obviously through the Is in

Craig Abrahams

is the that Yes, expectation.

Operator

comes Our from next of Aaron Macquarie. Lee question

Aaron Lee

on expectations pipeline Can are your X opportunities maybe now that's versus out you seeing ago seller M&A where how evolved in or you're touch the and market? and year there what a

Craig Abrahams

M&A think Sure. talked we of quarter our from I anything what strategy. in about has don't changed terms last

look portfolio to and industry, going continue of I at titles beyond. to ourselves years, still that going with our really to And on front, 'XX in higher growth the through and consolidator the continuing going a growth, execution forward. drive think our be as and 'XX We portfolio new liquidity sheet. positioned our on a well be is us, years titles and balance ourselves 'XX that to we key execute of as part are into the add our for the mix the see M&A sort very

Aaron Lee

Okay. Understood.

an some maybe a priorities? quick your as be can guys. among portfolio this you used with talked how localization. Or guys penetration international opportunity? now you about pillar to a something the of that this rank help be follow-up, AI have still does just more and Since growth could Is for broader potential As a

Robert Antokol

the question. for Thanks

So doing yes, we're of course, researching markets. opportunity

We know was said, have not. for strong of already a working related very as AI few this it's priorities or very growing we were don't hard, for and to us, markets Europe. But I one our business. especially if always main the that in

Operator

Next [ of from comes Lang Sachs. ] Cruza Goldman question

Unknown Analyst

This is Lang on for Eric.

customer what down in the being was health broader And you're just with the and you to revenues of about acquisition as in ROI landscape So seeing by can periods? you as first the market the half, hoping of your speak the well then overall talk guys terms competitors? I payback in

Robert Antokol

So thanks question. the for

the say challenging. is can market we First,

think to market. working doing hiding We hard. really, compared really this. well We're we're are And not I the

other very of that tell the games I that honestly, opportunities hand, games of well. to see has very opportunities And On world optimistic about future even I'm And mobile market devices. can the like side, growing. to that this from we my are control is see We you are other the something console. market, platforms and everyone comparing PC optimistic the and going about performing

optimistic. it's So very

very other the think few us On and last that see we something the hand, deal for our we the deals, we I fruit. grew major already ago, few always last business. did In M&A our was the years, was year

doing now. for the So our company, games future the comparing we're operation and this is the that going current to growth be

Nir Korczak

Nir CMO. second up on It's Korczak, Just to question Playtika marketing. about the follow the

know, So maturity. way at genres, And a our optimize not big we just We term reminder, we you at different term. things. from as different we have long the the business look look to the short portfolio things as with for different LTV, for a at is look games

look long we So opportunities. the term, when at when ROI, some see we at look we definitely

shifting and games budget different sources. all different between the We are time

the as and and we acquisition see majority mentioned the But leading -- new beginning, the at for Craig growth. games to goes the activity there, of improvement marketing most the for and room of still

Operator

Dessouky comes of question America. Next Omar from Bank of

Omar Dessouky

Okay.

help do in the CMO ramp given compared then to in XXXX, you. that is us permanently to going into I ecosystem double-click ad up larger opportunities, but the you you've first become something your a in where bit. on guys time. of -- going performance spend budget? And marketing you your half you where asset of are that marketing amount heard happen been -- the questions. just the dynamic. marketing the we are in little have performance please do terms that's improvements year as marketing, tech to X and on And rest goes of percent The Is the continue those that you finally, thank compelling your is so environment the there I see far. some so say journey. the that the very environment all happening you think about some to performance And You a in color think -- of performance -- you're to think But marketing wanted are on good this,

Nir Korczak

Nir super is again. Thanks for It's It's question. important understand to the that this a dynamic landscape.

goes looking other So everything different of at different with and a But around course, is we solutions, ad we super view. are of industry point that the solution and measurement dynamic. from things AI tech see

looking day, always So end the always for. the for we're of opportunities. We're what at looking

when Sometimes is new that's I we have that say opportunity. growing, the channels and

games, of to portfolio, we that and channel see with new and the that not diverse have optimize opportunity see budget go section. But deep we -- we areas trying our to case shift we this Sometimes and all very not a growth. always is and see on we obviously, we are

but are that, example, increasing there, we Craig Blitz and about to and to and optimize marketing keep like trying an also results. things as improve Bingo Just we mentioned things

we yes, this is very dynamic still see opportunity. obviously, So But a landscape.

cannot next we exactly look year like So right identify now. the will how

Operator

Capital. Our Eric next Handler of comes ROTH from question

Eric Handler

onetime? G&A And how what item I quantify like if Craig, line going forward? look you wonder that was of the much decline just could does

Craig Abrahams

Yes.

months. I something of don't managing at we G&A, kind structure at cost -- I the So last think our we over look look been as we've it's as XX

keep look we we we're overall it's as something stable that of at able in environment. as the it obviously, to as market light forward, where can As going looking

that nature, onetime you adjustments to in any and further if probably into can think see we are may dig I needed. it So

Eric Handler

run then mean $XX And Okay. It's -- had to Journey. June's now that came out I below million. with a regards it Solitaire I'm year great Harvest, Grand of million, around in couple $XX peaked assuming

been and happening about talk doing you're back could that the you that in sort on of decline get to what's So maybe what with game track?

Craig Abrahams

Sure.

with think quarter-to-quarter. volatility all games, I So as there's

of successful to or it. if And we acquired You most trending. the since growth look long-term you X X at acquisitions the last look years it's our over need at

mature volatility X I the as and we're we see new We're work more of top games going and DTC think forward looking going get map, to So to continue in. as at road and quarter-to-quarter. invest investing other invest titles into you continues expect be look on that we and to to our as some product features that to there forward,

Operator

next Lampen of comes BTIG. Our question from Clark

William Lampen

realistic understand establishing sort in close solitary getting I -- to about maybe we're you've either DTC Craig, of still that assume of are target know, you're is you higher launches, mix it Is think that mix. we DTC XX% June in there wanted bold comfortable for I and the the established you're for that of progress that also sharing sort us? just and But sort target a with environment. now new so, previously if of as or to to base both with should that be approaching case process

Craig Abrahams

question, as But to we in for our of business. them our We're M&A a changing as really can at of further the It DTC It be differentiator well pitching for on how acquired that we studios tool continues strategy terms execution. a is Clarke. their as as us. can for an not for differentiate Thanks helps to area us enhance use help well titles time. obviously, this target focus

on think the market so execute, accordingly. our and we update updates we'll as I have there And road map

William Lampen

that's think the also, of in thus up come I deck may presentation the the don't bullets I is IGG far. one you I call partnership. think, If in mentioned, on

more and that be the playable. that sort could for targeting both this something or hoping of provide around of detail also mobile content I And and mobile the down a browser might sort you environment maybe road? the released be could of is little this bit sort strictly So was you're when

Craig Abrahams

Sure.

So House this themed of live with Fun end into of is IGG go signed slot to to both help content and and our to all a Casino Slotomania, towards next with their games, We're to this licensing agreement that their year bring that looking into are access content. we year. top real-world recently going have Caesars the

cross-platform be So to in games games it bolster would further it's And those on that opportunity games, those exist excited content. about all games, the today. those platforms, with in once those across

Operator

of next from question Cost Matthew MS. comes Our

Matthew Cost

with new as the in the are years for guess point think the challenging expectations can I mentioned changes Slotomania, IGG that game a about end you you starting franchise. it's Slotomania just for from stabilize initiatives? And your deal, in Maybe it? guess year, remarks, to enough couple are the the marketing you making the this then half second given your of are get those of to when follow-up. you're X have prepared where I you been year think what those I the to a here of expectations the in

Craig Abrahams

on that in Absolutely, it. our product been Yes. has investing and focus stabilizing

as we're spending game success. and for category time in the It a competitiveness and consumer. we further content sets at still entertainment better our opportunities up product experience that other increase #X bolster partnerships bring improve other and strategic as look game as for the think obviously the category. in effort I to the to marketing, the is And well hopefully and bring that with of great

Matthew Cost

Like potential Wooga title your else Or portfolio Journey June's coming new out, next case, it for think it that's anything about if title? comparable should size . the or expectations? the from to a any I in in we the it's on is then how guess year. think that I bull was to And XQ way the success? Great.

Craig Abrahams

Sure.

-- story-driven That's opportunity to known Studio where another has it's story-driven they for So are and games. game the the Wooga excelled marketplace. best another bring here's to

with we'll update that gets details market. the into this more game to and And And as the the just of one launch, future. soft so real Obviously, accordingly. is launch preview come in

Operator

Our next UBS. Schoell of question comes Christopher from

Christopher Schoell

outlook strategies marketing and can then year, Any of share this debate Earlier and from recent to half a the pushed shift much been there's macro the learnings XXXX? how been in related due that does you has a step management mobile What or taking been targeting. structure in market the competition, the the you streamlined second this to for in to pullback maybe the has And you back biggest inform studios. do about you back, had industry early years how and believe factor? issues just your

Robert Antokol

Thanks really that It's The X thinking. very change the We for ago. it's we're years. change for the see months immediately, very different working we advantage only strategy the We impact. early us. we between a is games, This to X started see big okay, question. differently something. it's thing can say, very X, big the a for after a see an

Now many as do different company, things things, we many games. a with can

the right behavior to now Can you So repeat second the What tell of see years. was regarding moving. It's last really something I that optimistic about a question see change it. I you few very I'm in And in it. the early, but market the company.

Christopher Schoell

you you when the market's the how at market recovery has to past the macro in of of X or related in think second about performance how you thinking 'XX? shape this half competition And years, targeting the do are here issues? the Yes, look much of

Robert Antokol

us tough for First question 'XX. about is a

grossing market change few games see and or players players. I We think the It's a market. see places. see We in coming. U.S. we we market. became the in -- new a the don't the see mature become in years, top last the you We same tough the other don't see

second the of the very look community. Understanding the mobile the carefully you to industry. will understanding marketing, industry, how studios, company phase that when advantage operations, the for the This be is at understanding now a know operation. the So like retain

always and 'XX. a we market. I I'm about big more believer in can in Playtika bit you. the are about This This speak our a Thank So center is well. the of what the This is advantage doing for the little was us, again, very target.

Operator

program. for session. in question-and-answer today's conclude conference. your participation you the the does concludes This Thank This

may You disconnect. now

Playtika Holding (PLTK) 7 Aug 242024 Q2 Earnings call transcript