Quarterly report [Sections 13 or 15(d)]

SEGMENT REPORTING

v3.25.2
SEGMENT REPORTING
 6 Months Ended
Jun. 30, 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 June 30, 2025 Three Months Ended June 30, 2024
playGAMES playAWARDS Total playGAMES playAWARDS Total
Net revenue
Virtual currency $ 47,981  $ 227  $ 48,208  $ 56,477  $ —  $ 56,477 
Advertising 11,128  —  11,128  16,006  —  16,006 
Other —  2  2  105  2  107 
59,109  229  59,338  72,588  2  72,590 
Segment expenses
Cost of sales 14,539  24  14,563  18,068  —  18,068 
Payroll & related 9,079  1,453  10,532  9,783  2,798  12,581 
User acquisition 9,066  —  9,066  13,122  —  13,122 
Other(1)
9,950  1,138  11,088  9,695  680  10,375 
42,634  2,615  45,249  50,668  3,478  54,146 
Reportable segment AEBITDA 16,475  (2,386) 14,089  21,920  (3,476) 18,444 
Other operating expense
Corporate and other $ 3,375  $ 4,306 
Restructuring expenses 60  1,379 
Other reconciling items (2) 138 
Stock based compensation 4,608  4,930 
Depreciation and amortization 9,535  11,654 
17,576  22,407 
Non-operating income (expense)
Change in fair value of warrant liabilities 9  717 
Interest income, net 946  1,374 
Other expense (207) (264)
748  1,827 
Loss before income taxes (2,739) (2,136)
Income tax expense (209) (475)
Net loss $ (2,948) $ (2,611)
(1)Consists of legal, rent, information technology, outside services, marketing, and other general and administrative expenses.
Six Months Ended June 30, 2025 Six Months Ended June 30, 2024
playGAMES playAWARDS Total playGAMES playAWARDS Total
Net revenue
Virtual currency $ 98,673  $ 375  $ 99,048  $ 116,724  $ —  $ 116,724 
Advertising 22,991  —  22,991  33,448  —  33,448 
Other —  8  8  244  2  246 
121,664  383  122,047  150,416  2  150,418 
Segment expenses
Cost of sales 30,302  40  30,342  37,019  —  37,019 
Payroll & related 18,254  3,020  21,274  19,906  5,849  25,755 
User acquisition 19,223  —  19,223  27,876  —  27,876 
Other(1)
19,101  1,998  21,099  20,244  1,251  21,495 
86,880  5,058  91,938  105,045  7,100  112,145 
Reportable segment AEBITDA 34,784  (4,675) 30,109  45,371  (7,098) 38,273 
Other operating expense
Corporate and other $ 6,908  $ 8,821 
Restructuring expenses 1,395  2,017 
Other reconciling items 1  157 
Stock based compensation 8,866  9,724 
Depreciation and amortization 19,167  23,220 
36,337  43,939 
Non-operating income (expense)
Change in fair value of warrant liabilities 110  653 
Interest income, net 1,852  2,794 
Other expense (1,005) (370)
957  3,077 
Loss before income taxes (5,271) (2,589)
Income tax expense (557) (589)
Net loss $ (5,828) $ (3,178)
(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.
As of December 31, 2024, the Company had $2.2 million, $0.2 million and $0.4 million of liabilities associated with the Company's reorganization plan in the playGAMES, playAWARDS, and Corporate and other reportable segments, respectively. As of June 30, 2025, the Company paid most of these liabilities with an immaterial amount remaining unpaid as of June 30, 2025.