Q2 2021 Motorsport Games Inc Earnings Call
Thank you for standing by and welcome to the margin guidance, Inc. Second quarter 2021 earnings conference call.
All participants are in a listen only line that will be a presentation followed by a question and answer session.
You wish to ask a question you will need to put the stocky followed by the number one on your telephone keypad.
I would now like Android it should actually be semi integrated corporate relations. Please go ahead.
Thank you operator and.
And welcome everyone to motor Sport games second quarter, 'twenty, 'twenty, one conference call and webcast.
On today's call are Dmitry, Costco Motor Sport, Kim Executive Chairman and Chief Executive Officer.
Steven Hood, President and John Yu, Chief Financial Officer.
By now everyone should have access to the company's second quarter earnings press release filed today after market close.
This is available on the Investor Relations section of motor Sport games its web site.
At Www Dot motor sport games Dotcom.
During the course of this call management may make forward looking statements within the meaning of the federal Securities laws.
These statements are based on management's current expectations and beliefs and involve risks and uncertainties that could cause actual results to differ materially from those described in these forward looking statements.
Except as required by law the company undertakes no obligation to update any forward looking statements made on this call.
Or to alter its forward looking statements, whether as a result of new information future events or otherwise.
Please refer to today's press release, and the company's filings with the FCC.
Including the company's most recent annual report on Form 10-K, and the company's quarterly report on Form 10-Q for the period ended June 30th 2021 right.
For a detailed discussion of the risks that could cause actual results to differ materially from those expressed or implied in any forward looking statements made today.
In today's conference call, we will refer to certain non-GAAP financial measures such as adjusted EBITDA.
As we discuss the second quarter 2021 financial results you.
You will find a reconciliation of these non-GAAP measures to our actual GAAP results as well as two other related disclosures in the press release.
Issued earlier today.
And now I'd like to turn the call over to Dmitry, Costco, Chief Executive Officer of Motor Sport games Dmitry.
Thank you and Hello, everyone.
A pleasure to be speaking with you as we report another successful quarter of making meaningful progress toward a set for vision.
One was some exciting updates for motor sport games.
Please check out our investor video posted on the landing page of our website, which contains some very appealing visuals from our new highly anticipated NASCAR 'twenty one ignition game.
We hope these quarterly videos continue to give you the sense of Motorsport gave us progress towards our vision of being the household brand name Port racing games and esports.
Before I dive into details I want to say a quick thank you to our shareholders and racing fans, who have been patiently waiting for the release of our upcoming that's about 21 title.
Thank you for taking the time to learn our story and be part of this amazing journey.
All our new shareholders, let me quickly reiterate who we are and what drives us.
We're an award winning global leading racing game developer publisher and an esport ecosystem provider, although official motorsport racing series throughout the world.
Michelle Motorsport games is to create a spread the joy through a racing games, starting with our unique access to our parent company's approximately 60 million monthly active users N B L.
We set out to achieve this mission by developing and publishing racing games and immersive esports experiences for the world's most iconic racist and brands, who trust us with their valuable IP and often in a long term partnership like the one we have with NASCAR.
And as a recently in the car.
These are just examples of several iconic brands, we work with today with others, including ACO, which represents 24 all of them all.
And British touring car championship.
As we acquire more IP, we plan to leverage these iconic brands to build out of our core business.
We're now operating on a global scale.
Across six offices with more than 147 team members as of quarter end in U S U K, Russia, Australia and the Netherlands.
Our talented team of developers and artists are relentlessly collaborating to bring innovative experiences to our racing games and esports.
This global studio presence as one of many of the fresh gating factors as we continue to seek additional IP opportunities to expand our fan base and continue to grow as leaders across virtual racing space around the world.
We continue to assemble a strategic asset that we believe we need to elevate us from being a single franchise company to a multi franchise game publisher developer and in esports ecosystem provider.
That being said, we're so excited that earlier today, we made an official announcement there are newly built NASCAR franchise video game NASCAR 'twenty, one ignition will be released on October 28.
The state nicely coincides with the exciting finale of the NASCAR season, while also allowing US some added time to make additional improvements to the game.
It is extremely important to us that would bring the best possible product to our racing fans and we're confident our fans will enjoy this gaming experience.
Digital pre sales for the games are launching as early as tomorrow.
Which will provide insight into a pent up demand that is expressed by our fan based on multiple social channels.
From where we stand today, we believe market demand for this game is very strong.
Of course communicate regularly with our distributors and recently our largest distributor provided an estimate which is projected to put the day one order of NASCAR 21, physical this as the largest order ever received by Motorsport games for its published games.
NASCAR twenty-one ignition is also a perfect example of motorsport games primary growth strategy, which is to create racing games that we could scale by expanding our portfolio of brands into multiple franchises with multiple games each paired with a dedicated E sport offering.
Starting with our NASCAR partnership they have a chance to launch games across more platforms, including Nintendo switch. This is the first time, we're expanding to the switch platform.
Upcoming NASCAR switch games has just been submitted to la check.
We're incredibly excited for you to see the results. Once the game is released in Q4 of this year. Shortly after we released now start 'twenty one admission.
In the same vein in July 2021 we have successfully signed a long term partnership so released official in the car serious games and esports events.
Introducing brand new community of passionate racing fans to our motor sport games family of products.
With this partnership we're able to add an open wheel racing series to our portfolio does expanding the racing disciplines to create additional motor sports video games for all fans alike.
Our plan is to deliver a high quality realistic and exciting Indy car racing experience that fans have long been waiting for across a variety of platforms devices and formats.
Debuted Indy car title is expected to launch in 'twenty to 'twenty, three on Xbox and Playstation consoles as well as specie.
We expect that the Indy car series esports events could kickoff as early as fourth quarter of this year to start generating demand for the upcoming Indy car title.
We're also evolving the car craft brand into a fully develop racing game right.
Right now the game sits as an early release.
Every month, starting September we will be updating and adding new features to the game that we hope will in time result in a go to car racing game <unk>.
Aircraft is a perfect steppingstone into the world of virtual motorsport much like the real world, where a recognizable racing stars started their careers in carton.
Moving on to the topic of previous acquisitions and their integrations.
Since completing the acquisition of studio 397, and acquiring their hyper realistic technology platform are affected too we have been able to accelerate the integration of this technology into the new NASCAR 'twenty one ignition game.
And our upcoming Lamont N V T SEC titles.
Furthermore, this technology has provided us the ability to launch esport offering prior to the release of any game titles and even generate game sales revenue from the sale of such content using the artifact of two platform.
We cannot understate the growing importance of esports to our business, which has funneled new users across product base.
And driven higher fan engagement and your potential revenue streams from sponsorships.
We continue to dedicate ourselves to being the leading player in racing esports scene, and we believe that our combination of world class events around unmatched iconic IP and in fact, if user engagement with our fans will help us get there.
A few weeks ago, we saw finale of NASCAR ultimate summer shutdown esports serious well, we saw tremendous churn out from racist from all over the wall participating and we also launched Formula Pro series are affected too with World class esports team participation from the likes of Red Bull Racing Mercedes aimed.
Petronius William's team Red line Wolf team for Zillow and many more.
We're looking forward to the future of esport events later this year, including official events for B T C C Lamar and now in the car.
And with the artifacts or two technology, we intend to release and indeed card game pack that will allow our fans not only to participate in our upcoming official in the car E Sport event, but also test drive the Indy car experience, while we work on the official dedicated game.
And now Steven It was going to say a few words about our product development.
Thank you Dmitry.
Hello, everyone.
My name is Stephen Hoover and I'm, the president of much sport games.
As we approached this release milestone a significant step in the lives of our young company I would like to give an update on the continued expansion of our capabilities and our development teams are scaling to handle multiple franchises.
Well since the close out and really sound, even NASCAR projects are front and center of daily operations. We have established work streams processes and added head count specific to new projects from B T C C to lamont or more recently in the call.
Franchisees represent the next phase in the lifecycle of our business each benefiting from recent acquisitions, leveraging technology and skills now owned entirely by much spool games.
The acquisition of offense from Cockcroft technologies not to mention the impending release of our first food product NASCAR 21 ignition.
It's confidence in the realization of our M. S. G M games platform.
This is an evolving platform to be leveraged by all our franchisees, which bring significant efficiencies to our development operation.
A developer now Moscow studio will be as familiar with how to train and processes as any other b. They basically in Australia, the Netherlands, the U K O U S.
This distributed workforce has proven essential over the last 18 months and we continue to refine our lines of communication to ensure we get the very best for MAU teams.
As we have looked towards recruiting additional talent to spearhead the management of these new toy schools. This has resulted in us adding noteworthy personnel from companies such as flash damage out playing to segment and E criterion not to mention many of those we expect to announce in due course.
Technology is important to us use it right and we provide the foundation to differentiate through the application of our great talent.
Our people are at the heart of our capability and it gives me enormous pride to see the caliber of people we continue to recruit.
These hires share the same passion, we hold for making great racing games and have made clear and positive contributions to the business and we consider them integral to our continued growth.
For example.
Mobile development business is one area that has benefited from the key higher mobile executive producer wrote them.
I'm pleased to say that our NASCAR match three mobile game title, possibly the tunnel Green light is now expected to soft launch in Q4 of this year ahead of our global rollout in early 'twenty two.
We believe our mobile leadership team is now well positioned to execute when the forthcoming mobile on switch projects with any future mobile acquisition.
To integrate into the structure, which will aid future integrations as we look to drive significant IP through our mobile and handheld business unit.
Ultimately, we believe that our unmatched IP in house talent and past strategic acquisitions will create a household brand name for dedicated racing experiences for each of the long term world class licensees, we honed NASCAR indycar pneumonia and the British touring called Championship.
Let me hand, it over to John used to give a review of our second quarter financial results.
Thank you Steven.
We're pleased to welcome everyone to our second quarter 2021 earnings conference call. Our second quarter highlights include the acquisition closing of studio 397, and the buyout of the remaining minority interest in seven or four games during the quarter.
Revenues were $2.2 million and $3.9 million for the quarters ended June 30th 'twenty, 'twenty, one and 'twenty 'twenty respectively.
The increase of $1.7 million or 42%.
For the three months ended June 30th 2021 revenues from our gaming segment decreased $1.6 million or 41% to $2.2 million from $3.8 million in the prior year period.
The decrease in our gaming segment revenues compared to the 2020 period was primarily due to lower sales of our NASCAR console and PC games and to a lesser extent a reduction in mobile revenues.
Our esport revenues were zero and 100000 for the quarter ended June 30th 'twenty to 'twenty one.
In 2020, respectively. A decrease of 100000 from sponsorship revenues received while we held 70 sport events. During the second quarter of 2021, we did not earn any sponsorship revenues from these events as they were primarily marketing.
Gross profit was $1.3 million or 60% of revenues at $2.6 million or 67% of revenues for the quarter ended June 32021, and 'twenty 'twenty, respectively, a decrease of $1.3 million or 49%.
The decrease in gross profit was primarily due to reduction of $1.6 million in games revenue and an increase of <unk> 3 million in amortization expense, partially offset by the increased percentage of digital sales, which have a higher gross margin percentage than the sale of physical units.
With lower revenues and higher amortization expense during 2021, our gaming segment gross profit was $1.3 billion or $2.6 million for the quarters ended June 32021, and 2020, respectively costs relating to prizes staffing of these sports events resulted in a gross loss of 3000.
$500 and $4400 or your sports segment for the quarters ended June 32021, and 2020, respectively.
Operating expenses were $7.3 million and $2.5 million for the quarters ended June 30th 2021, and 2020, respectively, an increase of $4.8 billion.
Primarily attributable to a $4.1 million increase in general and administrative expenses incurred in connection with acquisitions and expanding our head count for playing a gross.
And 600000 for increases in our development costs as we expand our portfolio of game offerings.
The $4.1 million increase in general and administrative expenses includes $1.6 million of expenses relating to acquisitions 900000 increase in salaries and benefits 700000 increase in office and insurance costs 600000 increase in professional fees.
And a 100000 increase in noncash stock based compensation expenses.
Yeah.
Net loss attributable to motor Sport games was $5.8 million or 50 cents per share of class a common stock for the quarter ended June 30th 2021 compared to $78315 for the second quarter of 2020.
Negative adjusted EBITDA was $3.7 million for the quarter ended June 30th 2021 as compared to 400000.
Positive adjusted EBITDA for the quarter ended June 30th 2020.
Revenues were $4.7 million and $7.1 billion for the six months ended June 32021, and 2020, respectively. A decrease of $2.4 million or 34% for the six months ended June 30th 2021 revenues from our gaming segment decreased $2.3 million or 33% to four.
$7 million from 7 million for the six months ended June 30th 2020.
The decrease in our gaming segment revenues compared to the 'twenty 'twenty period was primarily due to lower sales of our NASCAR console games M.
N P C games and to a lesser extent a reduction in mobile revenue.
The sports segment revenues were $23919.93165 for the six months ended June 30th 2021 'twenty 'twenty, respectively. So that's a decrease of 69000 due to lower sponsorship revenues.
Held 11 events during the first six months of 2021 and again they were primarily marketing efforts.
Gross profit was 3 million or 64% of revenue.
$4.8 million or 67% of revenues for the six months ended June 30, 2021 and 'twenty 'twenty respectively.
A decrease of $1.8 million or 37%.
The decrease in gross profit was primarily due to the reduction in gaming revenues and an increase in amortization expense.
This was partially offset by the increased percentage of digital sales, which have a higher gross margin than the sale of physical units.
Our gaming segment gross profit was $3.1 billion and $4.9 million for the six months ended June 30th 'twenty, 'twenty, one and 'twenty 'twenty, respectively, primarily due to lower gaming revenues costs relating to prizes and staffing at esports events resulted in a gross loss of 46000.
$325 and $149456 and our E Sports segment for the six months ended June 32021, and 2020, respectively.
We have 11 events so far this year.
Operating expenses were $24.4 million and $4.8 million for the six months ended June 30th 2021, and 2020, respectively.
Increase of $19.6 million, primarily attributable to an increase of $18.2 million and general and administrative expenses 900000 increase in development expenses as we expand our game portfolio and a 400000 increase in sales and marketing to support a larger product offering.
The general and administrative expense increase of $18.2 million was comprised primarily of 9 million.
Kris and noncash stock based compensation $2.9 million increase for IPO related expenses.
One 9 billion increase in costs related to acquisitions of $1.6 million increase in salaries and benefits to sustain the larger game portfolio of $1.2 million increase in office and insurance expenses.
And a $1.1 billion increase in professional fees.
Our net loss attributable to butter Sports Games, Inc was $19.6 million or $1.88 per share of class a common stock for the six months ended June 30 of 2021 versus a net loss attributable motor sport games zinc of point 3 million for the six months ended June 30th two.
<unk> thousand 20.
Negative adjusted EBITDA was $6.5 million for the six months ended June 30th 2021 versus positive adjusted EBITDA of 300000 for the six months ended June 32020.
Let's touch on our financial expectations for the balance of the year given the fourth quarter release of NASCAR 21, ignition, we expect full year revenues to be approximately $25 million and adjusted EBITDA to be approximately negative $10 million.
Thank you for joining us today and now let's go to questions operator.
Thank you well now begin the question and answer question.
Look I think he might put star then one on your telephone keypad.
Tying acknowledging jelly class.
If anything I think if I take it got their hands full pricing okay.
Your question. Please press Star then two.
So that's question comes from Michael Graham from Canaccord. Please go ahead.
Thank you Hey, guys. Thanks for all the info and congrats on getting the the launch of the game set the video looks cool so thanks for that as well.
I have a few questions and I just wanted to start with you did just that.
Timing of the launch it was about a month later than you'd indicated in the last in the last earnings call.
And so one question was just you know to.
To the extent that there were no development delays can you just talk about maybe what you learned from those if anything and then one thing that seems like a positive is that it puts the launch a little bit closer to the holiday season, and I'm. Just wondering if if that was a factor in your decision making.
I am myself I can probably take them one at Steven.
I think it's fair to say that there's a lot then from the scenario that we're going through at the moment I mean, we've talked at length about.
The pandemic canned, it's quite clear that it impacted us to Sydney sent when it comes to testing and tweaking again towards the end of a project and most other than we would've liked.
And that's one of the reasons why we extended the timeline because as you know different cdos around the world, including the test teams and we are taught it all over this planet.
At times it local restrictions have meant that people who've had to relocate to work from home could you repeat some home that tough calls.
Particular challenges for US is if we've learned one thing from this process is probably.
How to work effectively in a very fast changing and diamond NAMIC environment, we can't predict rules, though care around the world and.
Moving specific hardware from the office to home has been a technical challenge not only for us, but our partners and Sony and Microsoft and we've learned a lot from those relationships.
So I think it's important to understand that.
The ever changing dynamic that we have to address them.
And also.
This kind of period of extension if I can just address this has given us the opportunity to leverage the input of recent superstars that of enjoying much spoke games and they input into the product I think has been quite significant which improves the quality of the game and.
And also goes into subsequent put us much spool games so zillow.
There's a lot to learn.
And are there all positives to take on this as well.
Hey, if I may add this is dmitry Michael Thank you for the question on the holiday part as you heard the reasoning from Steven on the two contributing factors, but it does give us a little added benefit with the holiday schedule being closer. So you can envision us, especially at the physical store.
<unk> being closer to the locations that demonstrate the new release titles more so than in our normal cycles will be going into the discounted black Friday type of participation. So us being you were closer to the holiday cycle, we believe will be beneficial to us.
Okay that makes sense.
Then the other question I wanted to ask is just on the on the guidance first of all I think it's a tremendous that youre issuing guidance for the first time I think that's great.
I'm just wondering you know when you think about some of your other revenue streams outside of the console games like E sports and mobile.
Did those factored significantly into your guidance or what was your guidance built primarily around.
Some of the console game.
Revenue.
Our our guidance.
They like they primarily are around.
Sorry, I'm talking primarily around the console.
N P C release of our NASCAR 'twenty one ignition.
Let's go ahead and we also have revenues yeah. We also have revenues kicking in hi, Michael We also have revenues kicking in from a studio 397, so that's starting to ramp up so there's a little bit coming from there too.
Got it Okay, and then last one for me and I'll go back in the queue. I. Just you know one of the things that jumped out at me in.
The release about the game launch was just the DLC components seem to be a big point of emphasis and also the career mode seem to be a big positive point of emphasis.
Maybe you could just touch on sort of how much of a of an addition, or those two features from your prior versions of.
NASCAR heat I guess and you know.
How how are how excited are you about those.
But we're definitely excited about bringing additional content.
A special especially champions type of content.
Elliott this are going to be a playable character I'm gonna carry paying schemes. There is some benefits to this whole champions addition, and ability to participate in our preorders that we're rolling out more southern went down before but I think more importantly, what we're really excited about since we.
An opportunity to build this title from scratch.
We are really hot.
Oh good.
Insight from our community has to what have been they have been kind of avoided by previous versions and what was not possible with the previous versions of the game to deliver such as a very robust paint booth.
To give the personalization that the fans nowadays really really desire. So we're more excited about those fad desired features.
More so than just the type of downloadable content and the offerings that the NASCAR allows us to bring in terms of content is concerned.
We're more excited about the personalization that they use this will hop there an escape but of course since it's built from scratch brand New physics, Brian Your graphics are we.
We just know that the look and feel of this product is something.
That well, while the user and that's the emotional we're going for and I think some of the early tracking up commentary around the game trailer that was just released earlier today.
Turning to prove that.
Okay, great. Thanks, so much I'll go back in the queue.
Thank you. Your next question is from Mike Hickey from benchmark.
Go ahead.
Hey, Dmitry Stephen John.
Great quarter guys. Thanks for taking my questions.
I guess the first one Dmitry I think you mentioned in your prepared remarks that.
You had an indication of physical salary.
Sounded like it was pretty substantial could you sort of double click on on that piece of it wasn't quite clear there, but it sounded like it was some sort of record compared to the prior iterations.
Sure. Thanks, Mike for the question. So yes, you are correct normally what happens in a cycle. That's before the release, we go through a series of meetings with the large retailers, which are paired with our distributors and obviously this is where the main biggest one which support.
Majority of all of the store support us and during dose is the information that the distributor collects in order to provide a pretty accurate statements sorry, our estimates and the reason I say pretty accurate is because historically what I've seen is their estimates are trying.
Slate into order almost one for one so it's very rare that a when our distributor estimates a certain amount of quantity of units.
That they either back down or increase on day, one they do increase afterwards, but they're pretty accurate on their day. One order. So where we are today is that we received those estimates alrighty problem are our largest distributor which has indicated clearly when we compare our historical data too.
Other games that motor Sport games has published when we compare it against those units.
It is our largest soda I.
Not able to say that it's a significantly as you might have alluded to it is definitely the largest is the record breaking for us.
But we want to also create a sort of a momentum and in a large demand. So we want those orders to continue to come in and instead of just taking one initial want that might last.
Throw out a period of time.
Nice. Thank you I think you mentioned you're going to start to open up digital Preorders Tomorrow. That's exciting are you providing incentives therefore for appropriate orders on digital or what are your expectations.
Absolutely and that's what we're very excited about and yes. The incentives are will give folks early access to play the game. There's a two day early access aircrafts somebody preorders are there's additional paint schemes that are unique to those stats our preorder.
So those historically have proven to us to be large enough incentive for our early adopters to hop in.
And what's good is that those preorders gave us a good indication of our additional ramp ups that we might have to do.
For our sell in orders for the stores. So we continue to pass this data back and forth without distributor so even though they're they want an order is already are essentially estimated four we still have an ability to bring them some preorder insight.
On the quantities are probably doing to talk about let's call. It a day two type of water.
Nice as NASCAR, helping with creating awareness for the game are they playing too.
There absolutely are and proud to say that as we unveiled our trailer on earlier today.
Within Ma.
Minutes of US unveiling it appeared on NASCAR dot com homepage, their social channels and so on and so on so and not only them, but there's definitely a pent up demand within drivers within teams.
There is definitely something that we're looking forward to and we've received an entire schedule of different things that NASCAR is gonna be contributing towards the promotion of this title.
Thanks, Dmitry last question I think for me here.
You, obviously had a tough comp against last year when shopping at home or.
This year, a reality I guess, what do you see sort of from player engagement in our core audience.
Sort of reopen the economy.
We do still see an increase if we compare towards pre pandemic time.
And now of course during the pandemic times there were an additional increase if we're comparing during pandemic N now, but if we to compare period of pre pandemic to now we're still higher than we were before so pandemic times did increase that plank and it did go.
Down a little bit, but not to the pre pandemic stage.
Of course, our users are also experiencing an older title than usual.
So we cannot wait to see what this interaction looks like as soon as they get their hands on this new title.
Awesome. Thanks, guys best of luck with Europe, you launch coming up in October.
Okay great.
Alright. Thank you. Your next question is from fighting Covid blackout from D. A Davidson. Please go ahead.
Hi, good afternoon, everyone. Thanks for taking my questions. This afternoon, well first of all congrats on a on the launch of a trailer.
Everybody's excited I've been kind of bouncing social media all of the social media channels in Europe.
People are cautiously optimistic and very excited though.
See the traction there but.
But you know one of the things that I've noticed.
People are talking about with the damage models.
So I guess the question for me to you is how do you feel about how your damage model into car it looks like today and how is it shaping up ahead of launch.
Hi, Frank.
Stephen at a very good question yeah everybody.
It seems to gravitate towards the the damage model and the NASCAR game I Wonder why it is something we put a fair bit of effort into because for US one of the important things is.
Not only the the visuals damage that you get to see on the cause and an a and a big accident smash or whatever that I'm sure everybody will try on day, one we would love to do that they're really important thing for us is to try and convey the fact that you are driving any machine. The body work is the shell you have an engine within the car the tires made of rubber that they contact.
Point on the ground. This stuff makes the whole experience feel more believable. So I think even need the trailer I did see it go lives you can see for example.
In engine starting to smoke in overheating. The carriage is the team starting to repair. It now a few people pick up on things like this in the trailer and the final game.
We will fill more believable to be driving a machine Ralph and the toys you doing most racing games. So it's eventually it goes hand in hand for us in terms of showcasing the damage visually which is a step above the NASCAR heat franchise and also making the whole experience more believable, you're driving a car. So I think for the initial installment.
People will be suitably impressed but we know that we're going to do a lot more to decide at the time and it will add to the experience and please fans new and older like.
Yeah, Thanks for that color and I can assure you that they will notice.
A few hours and.
Okay.
And then you obviously had no esports revenue within a quarter.
So I guess what is your outlook in this segment for the rest of the year. Obviously, you have them on coming up here in like 10 days or so so you know any color on whether you're making any changes to how you're monetizing this event compared to last year.
Hi, Frank Dmitry. Thanks for the question. So we definitely are.
As mentioned on the call are getting ready to launch quite a few marquee esports events and if you look at our Q2, we did not have such so there you could expect to have a quite a bit of a difference in terms of the results that we could derive both in audience and <unk>.
That's how quickly we could continue to grow our community and.
Of course revenues.
In Lamont virtual right, it's something that we're gonna be talking about very soon here together with an official B T. SEC type of esports and with the recent addition of empty car.
We are targeting to launch an official esports for any car also Q4 of this year or towards the end of the year. So multiple of those official once will.
Will be something that would be attracting.
Our sponsorship contributions towards our revenue lines, we haven't given a guidance separately on it.
So we're sticking to our 25 for the Europe, which includes that.
Okay. Thank you and then last one from me.
Any update on the esports integration onto traction here.
Sure.
So if you are referencing Franco maybe towards some of the points, we discussed on our previous call, where we said towards the end of the year. We're looking to include functionality, where folks will be able to sort of conduct their own events, yes, where are in development of such.
We havent made announcements along with a couple of other features that we're looking to bring to traction I. It is still in development and still on our roadmap.
Alright, Thank you very much for the color.
Thank you. Your next question comes from Michal Krupinski from noble capital market.
Go ahead.
Thank you for taking my questions I greatly appreciate that just a couple.
First of all maybe I may have missed this but did you go over the cash on hand, your current cash on hand.
No. It was it had a $26 million $25.26 million today.
I just wanted to ask two and then.
Thank you and then you talked a little bit about this but I was just wondering in terms of the impact from COVID-19 related to sales of video games, particularly the curve that we normally see in terms of sales is it has it been elevated as prices have been a little different they're different unit sales been differ.
As we went through 2020 and into 2021.
Anything that gives you think differently than a normal bell curve that you might've seen four port for the games.
Hey, Thanks, Michael for the question. So definitely there is some uplift from COVID-19 that we experienced and kind of seeing.
A reduction of that.
Also we had a new title since July of last year. So last year, we had a newer title on our hands.
That does help elevate the sort of the bell curve as you reference throughout the year. This year, we haven't had a new title like we did in the middle of last year.
Therefore, it does look different but if we work to align the release schedules are we would see a pretty small impact in terms of a COVID-19 contribution, but there's there is one.
And that was both our unit sales and pricing as well.
On both.
Mostly on unit sales, our pricing has been a pretty consistent against our historical information.
Got you and just a follow up question in terms of the launch window for NASCAR ignite are there any other titles that might compete with your launch you know it around October 28 that that might be you know a little bit of it.
What I would call tent pole type launches and things like that and then how the season finale on November 7th at NASCAR do you feel would be ideal launch for NASCAR at night just in case the launch slips for any reason what would be the window. What would you hope to you know I mean would you expect that to.
Would be a lift from the season finale that sort of thing.
So we definitely have chosen a season finale at towards the end of the season has as of date for us.
That allowed us a little bit more time too.
Take in the contribution from these superstars that joined our team recently like Stephen referenced.
And we do see that that is another optimal window for us similar to how we speculate.
Historical data has shown that September is a good window for us to launch would they tried last year July launch that has proven to be less.
Less of a of a success out of September would be.
But that's only one time trying it during that month compared to three years or so trying it in September. So October is a new one for us, but we do usually see a demand towards the end of the season just like there is a demand at the beginning of the season. So it's one of those ways that we hope too right.
Now as far as Europe, beginning of the question of additional titles now there is a of course up horizon that is coming out in November or scheduled to come out.
November but we are the only motorsport IP, so that does shine a light on us differently than anything else.
But there there's been some smirks around the quality of our game he went from.
From a Microsoft guys, making jokes is two Oh Wow. This is a this is really up to par so maybe they're referencing their own title.
Gotcha, Great. That's all I have thank you and good luck.
Thank you.
Thank you once again, if you wish to ask a question. Please press Star then one on your telephone keypad.
There are no further questions at this time I'll now hand back to meet your cost guidance for any closing remark.
I want to thank again for participating in our earnings call and I would like to hurt those that participated to take a look at some things that we're really proud of today. It's been a very special day, not just to deliver the results to you all but also to showcase for the.
First time ever to the world of what a game trailer of something we've been working on for a few years already could look like it is our marquee event for us it's super important to be able to.
Gather feedback and we're.
Super excited to be showcasing that sort of world. So I.
I urge you all to take a look if you haven't yet and do dig deeper into the comments see what the fans are there to say for themselves. Thank you very much for joining again.
Thank you that does conclude our conference call today.
Participating you may now disconnect.
Yeah.
Yeah.
Yeah.
[music].
Okay.
[music].
Yeah.
[music].
Yeah.
[music].