Annual report pursuant to Section 13 and 15(d)


12 Months Ended
Dec. 31, 2023
Segment Reporting [Abstract]  
During the fourth quarter of 2023, the Company revised the presentation of segment information to align with changes to how the chief operating decision maker ("CODM ") manages the business, allocates resources, and assesses operating performance. The CODM is the Company's Chief Executive Officer. Prior to the fourth quarter of 2023, the Company had a single operating and reportable segment. Beginning in the fourth quarter of 2023, the Company reports operating results based on two reportable segments: playGAMES and playAWARDS. Each reportable segment has a different service offering and different customer base. As of December 31, 2023, the Company's operating segments are the same as the reportable segments, which are as follows:
playGAMES: This segment is a leading developer and publisher of digital games on mobile and web platforms. It operates primarily in the social gaming market, which is characterized by gameplay online or on mobile devices, that is social, competitive, and self-directed in pace and session length. playGAMES also operate in the casual space. playGAMES generates a substantial portion of our revenue from in-app purchases in the form of virtual currencies, which players can use to play social casino games. Players who install our social casino games typically receive free virtual currency upon the initial launch of the game and additional virtual currencies at specific time intervals. Players may exhaust the virtual currencies that they receive for free and may choose to purchase additional virtual currencies in order to extend their time of game play. Once obtained, virtual currencies (either free or purchased) cannot be redeemed for cash nor exchanged for anything other than game play within our games. playGAMES generate additional revenue in the casual space from the receipt of advertising revenue. Players who install our casual games receive free, unlimited gameplay that requires viewing of periodic in-game advertisements.
playAWARDS: This segment consists of all of our loyalty assets globally in which we are developing an end-to-end loyalty solutions to help clients reward, enrich, motivate and retain customers, including program design, points management and administration, and broad-based fulfillment and redemption across multiple channels.
The CODM evaluates the performance of each operating segment using revenue and segment Adjusted EBITDA. Expenses include indirect costs that are allocated to operating segments based on a reasonable allocation methodology, which are generally related to sales and marketing activities and general and administrative overhead. Revenue and expenses exclude transactions between the Company's operating segments. The CODM does not evaluate operating segments using asset information.
Adjusted EBITDA ("AEBITDA") is the Company’s reportable segment GAAP measure, which management utilizes as the primary profit measure for its reportable segments and underlying operating segments. AEBITDA is a measure defined as net income (loss) before interest, income taxes, depreciation and amortization, restructuring and related costs (consisting primarily of severance and other restructuring related costs), stock-based compensation expense, and other income and expense items (including special infrequent items, foreign currency gains and losses, and other non-cash items). Expenses include indirect costs that are allocated to operating segments based on a reasonable allocation methodology, which are generally related to sales and marketing activities, general and administrative overhead, and costs associated with administering the playAWARDS myVIP program in the playGAMES applications. Revenue excludes transactions between the Company's operating segments. Certain expenses incurred by playAWARDS have been allocated to playGAMES at cost.
The following tables present the Company’s segment information:
For the Year Ended December 31,
2023 2022 2021
Net revenue
$ 306,714  $ 284,476  $ 287,419 
4,172  5,833  — 
Reportable segment net revenue 310,886  290,309  287,419 
Corporate and other —  —  — 
Net revenue $ 310,886  $ 290,309  $ 287,419 
playGAMES $ 88,676  $ 58,999  $ 57,865 
playAWARDS (10,379) (5,189) (8,990)
Reportable segment AEBITDA $ 78,297  $ 53,810  $ 48,875 
Other operating expense
Corporate and other
$ 16,005  $ 15,557  $ 9,329 
Restructuring expenses
8,584  13,020  3,082 
Other reconciling items(1)
214  25  7,601 
Stock based compensation 18,722  17,727  4,455 
Depreciation and amortization 45,259  35,562  27,398 
$ (10,487) $ (28,081) $ (2,990)
Non-operating income (expense)
Change in fair value of warrant liabilities $ 2,596  $ 1,047  $ 13,933 
Interest income (expense), net 4,858  1,925  (235)
Other income (expense), net 513  1,491  (229)
$ 7,967  $ 4,463  $ 13,469 
(Loss) income before income taxes $ (2,520) $ (23,618) $ 10,479 
Income tax (expense) benefit (16,873) 5,835  258 
Net (loss) income $ (19,393) $ (17,783) $ 10,737