Quarterly report [Sections 13 or 15(d)]

SEGMENT REPORTING

v3.25.1
SEGMENT REPORTING
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
SEGMENT REPORTING
NOTE 3—SEGMENT REPORTING
The Company has aggregated its operating segments into the following reportable segments: playGAMES and playAWARDS, which represent our different products and services. A detailed discussion regarding the products and services from which each reportable segment derives its revenue is included in our 2024 Annual Report on Form 10-K filed on March 14, 2025 and amended on Form 10-K/A filed on April 4, 2025.
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. Net revenue excludes transactions between the Company's operating segments. Certain expenses incurred by playAWARDS have been allocated to playGAMES at cost. The chief operating decision maker does not evaluate operating segments using asset information.
The following table presents the Company’s segment information:
Three Months Ended March 31, 2025 Three Months Ended March 31, 2024
playGAMES playAWARDS Total playGAMES playAWARDS Total
Net revenue
Virtual currency $ 50,692  $ 148  $ 50,840  $ 60,247  $ —  $ 60,247 
Advertising 11,863  —  11,863  17,442  —  17,442 
Other —  6  6  139  —  139 
62,555  154  62,709  77,828  —  77,828 
Segment expenses
Cost of sales 15,763  16  15,779  18,951  —  18,951 
Payroll & related 9,175  1,567  10,742  10,123  3,051  13,174 
User acquisition 10,157  —  10,157  14,754  —  14,754 
Other(1)
9,151  860  10,011  10,549  571  11,120 
44,246  2,443  46,689  54,377  3,622  57,999 
Reportable segment AEBITDA 18,309  (2,289) 16,020  23,451  (3,622) 19,829 
Other operating expense
Corporate and other $ 3,533  $ 4,515 
Restructuring expenses 1,335  638 
Other reconciling items 3  19 
Stock based compensation 4,258  4,794 
Depreciation and amortization 9,632  11,566 
18,761  21,532 
Non-operating income (expense)
Change in fair value of warrant liabilities 101  (64)
Interest income, net 906  1,420 
Other expense (798) (106)
209  1,250 
Loss before income taxes (2,532) (453)
Income tax expense (348) (114)
Net loss $ (2,880) $ (567)
(1)Consists of legal, rent, information technology, outside services, marketing, and other general and administrative expenses.
Reorganization
On October 29, 2024, the Company initiated an internal reorganization plan (the “2024 Reorganization Plan”) which is intended to enhance efficiency and reduce operating expenses. The 2024 Reorganization Plan included a reduction of the
Company’s total global workforce by approximately 30 percent, which was substantially completed by the end of the 2024 fiscal year. The following table presents the charges for the 2024 Reorganization Plan:
Three Months Ended March 31, 2025
playGAMES playAWARDS Corporate and Other Total
Severance and employee-related costs
 $ 342  $ 1  146  $ 489 
Total
 $ 342  $ 1  $ 146  $ 489 
The following table summarizes the activity related to the liabilities associated with the Company's reorganization plan:
playGAMES playAWARDS Corporate and Other Total
Balance as of December 31, 2024 $ 2,207  $ 196  $ 365  $ 2,768 
Reorganization charges and adjustments 119  1  18  138 
Payments (2,044) (188) (308) (2,540)
Balance as of March 31, 2025 282  9  75  366