Q1 2024 DoubleDown Interactive Co Ltd Earnings Call

Operator: Good afternoon, and welcome to Double Down Interactive's earnings conference call for the first quarter ended March 31, 2024. My name is Brianna, and I will be your operator this afternoon.

Good afternoon, and welcome to double down interact its earnings conference call for the first quarter ended March 31, 2024. My name is Brianna and I will be your operator this afternoon.

Operator: Prior to this call, Double Down issued its financial results for the first quarter of 2024 in a press release, a copy of which has been furnished in a report on Form 6K filed with the SEC and is available in the Investor Relations section of the company's website at www.doubledowninteractive.com. You can find the link to the Investor Relations section at the top of the home page. Joining us on today's call are Double Down CEO, Mr. In Kook Kim, and CFO, Mr. Joe Sigrist.

Operator: Prior to this call double down issued its financial results for the first quarter 'twenty 'twenty four and a press release, a copy of which has been furnished in our report on form 6K filed with SEC and is available in the Investor Relations section of the company's website at Www Dot double down interactive dotcom.

Speaker Change: You can find the link to the Investor Relations section at the top of the homepage joining us on today's call are double down CEO, Mr. In Cook, Kim and CFO, Mr. Jos cigarettes.

Operator: Following the remarks, we will open the call for questions.

Operator: Following these remarks, we will open the call for questions. Before management begins its formal remarks, we need to remind everyone that some of management's comments today will be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the company hereby claims the protection of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Operator: Before management begins their formal remarks, we need to remind everyone that some of the management's comments today will be forward looking statements within the meaning of section 27, a of the Securities Act of 19 thirty-three.

Operator: As amended and section 21 E of the Securities Exchange Act of 1934 as amended and the company hereby claim the protection of the Safe Harbor provisions of the private Securities Litigation Reform Act of 1995.

Operator: Forward-looking statements are statements about future events and include expectations and projections, not present or historical facts, and can be identified by the use of words such as may, might, will, assume, believe, intend, estimate, continue, should, anticipate, or other similar terms. Forward-looking statements include, but are not limited to, those regarding the company's future plans, mergers, and acquisition strategies, strategic and financial objectives, expected performance, and financial outlook. Forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially and adversely from what the company expects. Therefore, you should exercise caution in interpreting and relying on them.

Operator: Forward looking statements are statements about future events and include expectations and projections not present or historical facts and can be identified by the use of words such as May might will expect assume believes intend estimate continue should anticipate or other similar terms.

Operator: Forward looking statements include and are not limited to those regarding the company's future plans mergers and acquisition strategy strategic and financial objectives expected performance and financial outlook.

Operator: Forward looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially and adversely from what the company expects.

Operator: Therefore, you should exercise caution in interpreting and relying on them.

Operator: We refer you to Double Down's annual report on Form 20-F filed with the SEC on March 28th, 2024, and other SEC filings for a more detailed discussion of the risks that could impact future operating results and financial conditions. These forward-looking statements are made only as of the date of this call. The company does not undertake and expressly disclaims any obligation to update or alter the forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Operator: We refer you to double down annual report on form 20-F filed with the SEC on March 28, 2024, and other SEC filings for a more detailed discussion of the risks that could impact future operating results and financial condition.

Operator: These forward looking statements are made only as of the date of this call. The company does not undertake and expressly disclaims any obligations to update or alter the forward looking statements, whether as a result of new information future events or otherwise except as required by law.

Operator: During the call, management will discuss non-GAAP measures that are believed by management to be useful in evaluating the company's operating performance. However, these measures should not be considered superior to, in isolation, or as a substitute for the financial results prepared in accordance with GAAP.

Operator: During the call management will discuss non-GAAP measures, which are believed by management to be useful in evaluating the company's operating performance. These.

Operator: These measures should not be considered superior to in isolation or as a substitute for the financial results prepared in accordance with GAAP.

Operator: A full reconciliation of these measures, the most directly comparable gap measure, is available in the earnings release and on Double Down's Form 6K filed with the SEC prior to this call. I would like to remind everyone that this call is being recorded and will be made available for replay via a link in the investor relations section of Double Down's website. It's now my pleasure to turn the call over to Double Down CEO In Kook Kim. Thank you.

Operator: Full reconciliation of these measures the most directly comparable GAAP measure is available in the earnings release and on double down swarm 6K filed with the SEC prior to this call.

Speaker Change: I would like to remind everyone that this call is being recorded and will be made available for replay via a link in the Investor Relations section of double Downs website.

Speaker Change: It is now my pleasure to turn the call over to double down and CEO input Kent.

In Keuk Kim: Good afternoon, everyone. Thank you for joining us on our 2020 first quarter earnings call. Today we announce that total Q1 revenue was $88.1 million, with $79.8 million generated by our social casino free-to-play games and $8.3 million coming from the operations of SuperNation, our recent iGaming acquisition. Revenue from our social casino free-to-play games was up 1% on a quarterly sequential basis and up 3% compared to Q1 2020. I mean, continue to do an excellent job of converting revenue to profit and cash flow with adjusted EBITDA for the first quarter rising 26% year over year to $31.9 million and cash flow from operations at $35 million.

Speaker Change: Thank you.

In Keuk Kim: Our flagship social casino game, Double Down Casino, or DDC, continues to be the driver of our strong results, as it increases year over year in our sum of our most important KPIs, including average monthly revenue per payer and payer conversion. More specifically, we are growing monetization with our core paying players as they continue to record the great entertainment experience and compelling value that we offer. We believe our revenue growth reflects the benefits we are seeing from the introduction of new meta features within DoubleDown.

Speaker Change: Good afternoon, everyone.

Speaker Change: Thank you for joining us on our tiny tiny for first quarter earnings call.

In Keuk Kim: Today, we announced that Aura Q1 revenue was 88 1 billion.

In Keuk Kim: <unk> nine $8 million generated by our social casino free to play games.

In Keuk Kim: And $8 $3 million coming from the operations.

In Keuk Kim: Our written gaming application.

In Keuk Kim: Q1 revenue from our social casino free to play games.

In Keuk Kim: <unk> was up 1% on a quarterly sequential basis and up 3% compared to Q1 2023.

In Keuk Kim: I mean, they continue to do that.

In Keuk Kim: <unk> job in converting revenue to profit and cash flow adjusted EBITDA for the first quarter rising 26% year over year with $31.9 million in cash flow from operations at $35 million.

In Keuk Kim: Our fish social casino game double down casino or GDP continues to beat the driver of our strong results as we generated year over year increases in our some of our most important kpis, including average monthly revenue per payer and payer conversion rate.

In Keuk Kim: More specifically, we are growing monetization via our core Peng players as they continue to recognize that.

In Keuk Kim: Great Entertainment experience.

In Keuk Kim: Calling value that we offer.

In Keuk Kim: We believe our revenue growth reflects the benefits we're seeing from the introduction of new features and double down Casino. These features such as <unk> and wind power, which I mentioned during last quarter's call.

In Keuk Kim: These features, such as Locky Orb and Flame Power, which I mentioned during last quarter's call, add to the fun of playing DDC, thereby driving player engagement and retention, and we believe leading to higher overall monetization. In addition, during this second quarter, we plan to launch Mission Pass, which offers players daily, weekly, and monthly quests alongside their casino games played.

In Keuk Kim: So the fun.

In Keuk Kim: Edp, thereby driving player engagement and retention and we believe leading to higher overall monetization.

In Keuk Kim: In addition.

In Keuk Kim: During the second quarter, we plan to launch mission patch, which offers players daily weekly and monthly classes alongside their casino games play.

In Keuk Kim: Our strategy in social casino is to continue enhancing the entertainment value of DDC while remaining disciplined in user acquisition and R&D spending to drive strong profitability and free cash flow. Turning to Supernation, Q1 represented our first full quarter of operation of this iGaming platform. Our focus at this early stage is to scale the business. And we were pleased with the results so far, with SuperNation's Q1 revenue contribution of $8.3 million. The iGaming sector represents an exciting growth opportunity for Double Down.

In Keuk Kim: Our strategy in the social casino is to continue enhancing the entertainment value of GBP, while remaining disciplined and user application and R&D spending to drive strong profitability and free cash flow.

In Keuk Kim: Turning to foundation to one that presented our first full quarter of operation.

In Keuk Kim: Gaming business, our focus at its OLED stage is to scale the business and we.

In Keuk Kim: We are pleased with our results so far right. So foundation's two on revenue contribution of $8 3 billion.

In Keuk Kim: Yeah.

In Keuk Kim: The I gaming sector represents an exciting.

In Keuk Kim: And we are very pleased to be up to such a strong start with plans for continued improvement. The SuperNation acquisition is just an initial step in our goal to diversify our business into new gaming categories that have highly addressable market opportunities. Given our excellent financial foundation, we continue to evaluate ways to expand into this market, both organically and through M&A. As we execute on this strategy, we will apply the same capital discipline we have exhibited over the years.

In Keuk Kim: Gross opportunity for double down and we are very pleased to be off to such a strong start we had plans for continued improvements.

In Keuk Kim: The superannuation that position it just an initial step in our goal to diversify our business into new gaming categories that have highly addressable market opportunities.

In Keuk Kim: Our excellent financial Foundation, we continue to evaluate ways to expand into deep markets, both organically and through M&A.

In Keuk Kim: As we execute on this strategy, we will apply the same capital discipline, we have exhibited over the years.

In Keuk Kim: As an example, on our first quarter call, I highlighted the launch of our first game in the skill-based gaming category. However, after ramping up marketing investment to acquire players in Q1, its performance metrics did not meet our requirements. And as such, we have decided not to proceed with additional user acquisition activities going forward. However, we are continuing to invest in new internally developed mobile games, including those we expect to launch in 2024.

In Keuk Kim: As an example on our first quarter call I highlighted the launch of our first game and that skill based gaming category. However, after ramping up marketing investment to acquire players in Q1.

In Keuk Kim: My metrics did not meet our requirements and as such we have decided not to proceed with additional user acquisition <unk> going forward.

In Keuk Kim: We are continuing to invest in internally developed.

In Keuk Kim: But our overriding principle when we undertake these new game launches is to ensure we are deploying our capital and expertise in a manner that creates additional value for say or her. If that proves not to be the case, we have demonstrated that we will quickly move on. Now I'll turn it over to our CFO Joe Sigrist to walk us through our financials before providing my closing remarks.

In Keuk Kim: Mobile games, including those we expect to launch in 2024, but our overriding principle.

Joseph A. Sigrist: When we undertake this new game launches is to ensure we are deploying our capital and expertise in a manner that creates additional value for shareholders.

Joseph A. Sigrist: If that proves not to be the case, we have demonstrated that we will quickly move on.

Joseph A. Sigrist: Now I turn it over to our CFO Jos Sechrist to walk us through our financials before providing my closing remarks.

Joseph A. Sigrist: Thank you, IK, and good afternoon, everyone. Our revenues for the first quarter of twenty twenty four, or eighty eight point one million dollars, comprised seventy nine point eight million dollars in revenues from our social casino, free-to-play games, and eight point three million dollars in revenues from Super Nation. This compares to total company revenues of $77.6 million in Q1 2023. As I.K.

In Keuk Kim: Joe.

Joseph A. Sigrist: Thank you Ike and good afternoon, everyone. Our revenues for the first quarter of 2024 or $88 $1 million comprised of $79 $8 million in revenues from our social casino free to play games and $8 3 million of revenues from Super Nation.

Joseph A. Sigrist: This compares to total company revenues of $77 $6 million in Q1 2023.

Joseph A. Sigrist: As mentioned, Social Casino's free-to-play revenue in the first quarter of 2024 was up 1% sequentially from the fourth quarter of 2023 and 3% year-over-year. In the first quarter, several KPI metrics for our social casino business again improved compared to the year-ago period, including average revenue per daily active user, or ARPDAU, increased to $1.26 in Q1 2024 from $1.03 in Q1 2023, marking a 22% increase. Payer conversion ratio, which is the percentage of players who pay within the social casino apps, increased to 6.4% in Q1 of 2024, compared to 5.

Joseph A. Sigrist: As I K mentioned, social casino free to play revenue in the first quarter of 2024 was up 1% sequentially from the fourth quarter of 2023, and 3% year over year.

Joseph A. Sigrist: In the first quarter, several kpis metrics for our social casino business again improved compared to the year ago period, including average revenue per daily active user or ARP DAU increased to $1.26 in Q1 2024 from $1 <unk> in Q1 2023.

Joseph A. Sigrist: <unk>, marking a 22% increase.

Joseph A. Sigrist: Their conversion ratio, which is the percentage of players who pay within the social casino apps increased to six 4% in Q1 of 2024 compared to five 8% in Q1 of 2023.

Joseph A. Sigrist: And average monthly revenue per payer at $281 in the first quarter of 2024 increased 27% from $221 in Q1 of 2023.

Joseph A. Sigrist: Operating expenses rose on both a year-over-year and quarterly sequential basis to $57.1 million compared to $52.2 million in the first quarter of 2023 and $47.5 million in the fourth quarter of 2023. The OPEX increase in Q1 was primarily due to the inclusion of Supernation's operating expenses, as this was the first full quarter consolidation of its financial results into those of Double. Sales and marketing expenses for the first quarter of 2024 were $14.8 million, a decline of 8% compared to Q1 2023, and up nearly 50% on a quarterly sequential basis.

Joseph A. Sigrist: Operating expenses rose on both a year over year and quarterly sequential basis to $57 $1 million compared to $52 2 million in the first quarter of 2023, and 47 $5 million in the fourth quarter of 2023.

Joseph A. Sigrist: The Opex increase in Q1 was primarily due to the inclusion of Super Nations operating expenses. As this was the first full quarter consolidation of its financial results into those double down.

Joseph A. Sigrist: Sales and marketing expenses for the first quarter of 2024 or $14 8 million a decline of 8% compared to Q1, 2023 and up nearly 50% on a quarterly sequential basis.

Joseph A. Sigrist: The sequential increase was comprised of the first time full quarter inclusion of super nation sales and marketing expenses, as well as the acquisition of players for the skill-based gaming app IK, as noted earlier. Sales and marketing costs directed at acquiring new social casino players continue to reflect our focus on spending to ensure we deliver the best return on this investment.

Joseph A. Sigrist: The sequential increase was comprised of the first time full quarter inclusion of Super nation sales and marketing expenses as well as the acquisition of players for the skill based gaming App Ik noted earlier.

Joseph A. Sigrist: Sales and marketing costs, directed and acquiring new social casino players continued to reflect our focus on spending to ensure we deliver the best return on this investment.

Joseph A. Sigrist: For the next several quarters, we anticipate that overall sales and marketing expenses for the company will stay relatively close to or below the Q1. Net income for the first quarter of 2024 was $30.4 million, or $12.23 per diluted share and 61 cents per ADS, a rise of 28.3%, 28.1%, and 27.1%, respectively, compared to the net income of $23.7 million, or $9.55 per diluted share and $0.48 per ADS. In the first quarter of 2020.

Joseph A. Sigrist: For the next several quarters, we anticipate that overall sales and marketing expenses for the company will stay relatively close to or below Q1 levels.

Joseph A. Sigrist: Net income for the first quarter of 2024 was $34 million or $12 23 per diluted share and 61 cents per <unk>, a rise of 28, 3% 28, 1% and 27, 1% respectively.

Joseph A. Sigrist: Compared to the net income of $23 $7 million or $9 55 per diluted share and 48 cents per <unk> in the first quarter of 2023.

Joseph A. Sigrist: Adjusted EBITDA for the first quarter of 2024 increased 26% to $31.9 million compared to $25.4 million for the prior year quarter. Adjusted EBITDA margin was 36.2% for Q1 2024, representing an improvement from 32.8% in Q1 2020. Net cash flows from operations were $34.9 million for the first quarter of 2024, compared to net cash flow from operations of $19.2 million in the prior year period. Finally, turning to our balance sheet, as of March 31, 2024, we had $310 million in cash, cash equivalents, and short-term investments, with a net cash position at quarter end of approximately $272 million, or approximately $5.50 per ADS, excluding the outstanding loans with our That completes my financial summary. Now I'll turn the call over to IK for his closing remarks. Thank you.

Joseph A. Sigrist: Adjusted EBITDA for the first quarter of 2024 increased 26% to $31 $9 million compared to $25 $4 million for the prior year quarter.

IK: Adjusted EBITDA margin was 36, 2% for Q1 2024, representing an improvement.

IK: 32, 8% in Q1 2023.

IK: Net cash flows from operations were $34 $9 million for the first quarter of 2024 compared to net cash flow from operations of $19 $2 million in the prior year period.

IK: Finally, turning to our balance sheet as of March 31, 2024, we had $310 million in cash cash equivalents and short term investments with a net cash position at quarter end of approximately $272 million or approximately <unk> <unk>.

IK: $5 50 per <unk>, excluding the outstanding loans with our controlling shareholder W games.

IK: That completes my financial summary, now I'll turn the call over to <unk> for closing remarks.

In Keuk Kim: We began 2024 demonstrating our ability to further expand the operating and financial performance momentum of the company with strong Q1 results in our core social casino business and an excellent start to our new iGaming business. In our core social casino business, we will continue enhancing and improving Double Down Casino through ongoing product development, marketing initiatives, and live ops efforts. We see this as a capital efficient way to continue driving engagement and monetization that also delivers high cash flow.

IK: Thank you Joe.

IK: We began tiny tiny for demonstrating our ability to further expand operating and financial performance momentum of the company with strong Q1 results and our core social casino business and an excellent start to our new <unk> gaming business.

In Keuk Kim: In our core social casino business, we will continue enhancing and improving double down casino through ongoing product development marketing initiatives and live ops efforts, we see this as a capital efficient way to continue driving engagement and when.

In Keuk Kim: Hi, Jason that also delivers high cash flow.

In Keuk Kim: As we mentioned during last quarter's call, we also are focused on enhancing our already strong margins by increasing our direct consumer payment volume while it is on holidays with this initiative. Additionally, we are beginning to expand the options that players have to purchase chips for Double Down Casino. In the near term, at Supernation, our focus is to invest to grow the player base in both the UK and Sudan. We look forward to the continued positive impact of these efforts to scale the business, and we will continue to pursue growth through participation in adjacent categories of gaming through both our organic efforts and as we continue to evaluate M&A opportunities. We're now happy to take your questions. Brianna, Thank you.

In Keuk Kim: As we mentioned during last quarters call. We also are focused on enhancing our already strong margins by increasing our direct to consumer payment volume.

In Keuk Kim: It is only days with this initiative.

In Keuk Kim: We are beginning to extend the options that players have to purchase chips for <unk> casino.

Speaker Change: The near term at supervision.

In Keuk Kim: Our focus is to invest to grow the player base.

Speaker Change: In both the UK and some of them.

In Keuk Kim: Look for continued positive impact of these efforts to scale the business.

In Keuk Kim: And we will continue to pursue growth through participation in adjacent categories of gaming through both our organic efforts and as we continue to evaluate M&A opportunities.

Speaker Change: We now happy to take your questions Brianna.

Operator: Thank you. At this time, we will conduct the question and answer session. To ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q and A session. Our first question comes from Aaron Lee of Macquarie. Your line is now open.

Brianna: Thank you at this time, we will conduct a question answer session.

Operator: To ask a question you will need to press star one one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one one again, please standby, while we compile the Q&A roster.

Operator: Okay.

Operator: Our first question comes from Aaron Lee of Macquarie. Your line is now open.

Aaron Lee: Great, thanks for taking my question and congrats on the quarter. So I wanted to get some more color on the Supernation business and get a sense, first, how the quarter performed relative to your expectations. Sounds like it came in above. And secondly, how should we be thinking about the balance of the year? I believe there's some summer seasonality in there, but do you expect momentum to build sequentially as we go through 2Q to 4Q? Thank you.

Aaron Lee: Great. Thanks for taking my question and congrats on the quarter. So wanted to get some more color on the Super nation business and get a sense for how the quarter performed relative to your expectations. It sounds like it.

Aaron Lee: Came in above and secondly, how should we be thinking about the balance of the year I believe theres some summer seasonality in there, but do you expect momentum to build sequentially as we go through <unk>. Thank you.

Unknown Executive: Yeah, thanks, Aaron. I appreciate the questions.

Speaker Change: Yes, Thanks, Erin I appreciate the questions. So with regards to the Q1 performance of Super Nation, we are.

Speaker Change: Pleased with the results.

Speaker Change: Feel like the.

Unknown Executive: So with regard to the Q1 performance of Supernation, we are, you know, pleased with the results. We feel like now, after the end of the first quarter, to the first five quarters of having their business as part of ours has been very positive. As we mentioned, the focus initially has been on scaling new user acquisition activity, and we have, you know, been pleased to see the fairly quick ability to acquire players and then turn them into, you know, meaningful revenue contributors.

Unknown Executive: Now.

Speaker Change: I guess after the end of the first quarter to the first five quarters of.

Unknown Executive: Having their business as part of ours has been very positive.

Unknown Executive: As we mentioned the focus initially has been on scaling new new user acquisition activity.

Unknown Executive: And we have.

Unknown Executive: But I'm pleased to see the fairly quick.

Unknown Executive: Ability to acquire players and then turn them in.

Unknown Executive: Into meaningful.

Unknown Executive: Revenue contributors.

Unknown Executive: As it relates to the rest of the year, I mean, we'll have to see if we can continue to see that quick conversion, if you will, from marketing investment into playing, depositing, and ultimately revenue. And we'll see how it plays out, but we, as IK has said, are very pleased with the start.

Unknown Executive: As it relates to the rest of the year.

Unknown Executive: I'll have to see if we can continue to see that.

Unknown Executive: <unk>.

Unknown Executive: Quick conversion, if you will from marketing investment into.

Unknown Executive: Into playing depositing.

Unknown Executive: And ultimately revenue and.

Unknown Executive: Well, we'll see how it plays out but we as I can.

Unknown Executive: We're very pleased with the.

Unknown Executive: The start of this.

Unknown Executive: Got it, understood. And then just a quick housekeeping item. With this being the first full quarter of Supernation in your results, how should we think about your cost structure? Is 1Q OpEx a good level to run forward for expenses like R&D and G&E?

Unknown Executive: Got it understood and then just a quick housekeeping item.

Unknown Executive: With this being the first full quarter of Super nation within your results. How should we think about your cost structure is <unk> opex a good level to run forward for expenses like R&D and G&A.

Unknown Executive: Yeah, by and large, I think everything is kind of a full quarter included in q1. And, you know, relative to the expense categories. I mean, the only variability is going to be on the marketing side, as I mentioned, marketing will likely be at or below where we have been or where we were in q1 for the rest of the year on a quarterly basis, primarily because of the fact that we won't be investing in our first skill-based game anymore to acquire new players. But other than that, I think, you know, the run rates are pretty much going to hold true.

Unknown Executive: Yes by and large I think everything is kind of a full quarter.

Unknown Executive: Included in Q1.

Unknown Executive: Relative to.

Unknown Executive: To the expense categories I mean, the only variability is going to be on the marketing side as I mentioned.

Unknown Executive: Marketing will will likely be at or below where we are.

Unknown Executive: Have a ban or where we were in Q1 for the rest of the year on a quarterly basis, primarily because of.

Unknown Executive: The fact that we won't be investing in our first skill based game any longer to acquire new players, but other than that I think the run rates are pretty much hold true.

Unknown Executive: Got it. Very helpful. Thank you. Sure. Thanks, Aaron.

Speaker Change: Got it very helpful. Thank you.

Operator: Thank you, and please wait one moment for our next question. Our next question comes from Greg Gibas of Northland Securities. Your line is now open.

Speaker Change: Sure. Thanks, Sarah.

Speaker Change: Thank you and one moment our next question.

Gregory Thomas Gibas: Our next question comes from Greg <unk> of Northland Securities. Your line is now open.

Gregory Thomas Gibas: Hey, good afternoon, IK, and Joe. Congratulations on the results.

Gregory Thomas Gibas: Hey, good afternoon, I can Joe.

Unknown Executive: Wanted to follow up on just, you know, the core business at Super Nation. You know, nice to see that up year over year considering it's been challenging for social casino as a whole. Just kind of curious if you could discuss maybe what you think drove that.

Gregory Thomas Gibas: Graph on the result.

Gregory Thomas Gibas: Wanted to follow up on just the.

Unknown Executive: The core business ex Super nation.

Unknown Executive: You can see that up year over year, considering it's been challenging for both of the casino as a whole.

Unknown Executive: Curious if you could discuss maybe what you think drove that.

Unknown Executive: Yeah, I think, as we mentioned last quarter, which we were pretty pleased with relative to our results within the core business, it's, it's a lot about the product and product differentiation, and being able to incent players to continue to play, and then ultimately, we know that leads to monetization. IK mentioned the ongoing development of new meta features. These are features that span the various individual casino and slot games that we have in Double Down Casino, and we're continuing to focus on that and developing additional really fun. I mean, at the end of the day, you know, people have fun when they play Double Down Casino, and certainly they have fun when they play our individual games, individual slots.

Speaker Change: Yes, I think as we mentioned last quarter, which also we were pretty pleased with relative to.

Unknown Executive: Our results within the core business.

Unknown Executive: It's it's.

Unknown Executive: A lot about the product.

Unknown Executive: And product differentiation and being able to.

Unknown Executive: And sent players to continue to play and then ultimately we know that leads into monetization. So.

Unknown Executive: K mentioned.

Unknown Executive: Ongoing development of New meta features these are features that span the various individual casino and slot games that we have in that.

Unknown Executive: Double down casino and.

Unknown Executive: We're continuing to focus on that.

Unknown Executive: And developing additional.

Unknown Executive: Really fun I mean at.

Unknown Executive: At the end of the day.

Unknown Executive: People have fun when they play double down casino and certainly they have fun with May play are.

Unknown Executive: But we also want them to have fun as they return to play, and they have additional journeys and quests and things that we add on, if you will, on top of the individual games that add to the fun. And at least over the last couple of quarters, you know, we think that's been a good part of why people are so excited to still be with us and continue to play and to pay.

Unknown Executive: A visual games individuals' slots, but we also want them to have fine as they return to play and they have additional journeys.

Unknown Executive: Quest and things that we add on if you will on top of the individual games that add to the fun and at least over the last.

Unknown Executive: A couple of quarters, we think that's been that's been a good part of why people are so excited to still be with us and continue to play in to pay.

Unknown Executive: Great, that's good to hear. Cool. And then, you know, switching over to Supernation, you know, my understanding of pretty strong results out of them, wondering if you could just kind of talk about your rough expectations there, and you have kind of how that performance compares to a year ago quarter with them, and if you could maybe just discuss kind of seasonality and if it differs from your core business.

Speaker Change: Great that's good to hear.

Unknown Executive: Cool and then switching over to supination.

Unknown Executive: My understanding pretty strong results out of them.

Unknown Executive: Wondering if you could just kind of talk about your expectations there.

Unknown Executive: And you have kind of how that performance compared to a year ago quarter with them and if you could maybe just discuss kind of seasonality and a bit different from your core business.

Unknown Executive: Yeah, I mean, it's early days with Supernation being part of us. We're learning the iGaming business, but we also Uh, do know that the initiatives that We and they have been working on with their business and for their business on the marketing side have contributed to the strong results that we reported today in their business. And that's why we want to continue them. And, you know, they're also very focused on product differentiation, as well.

Speaker Change: Yes, I mean, it's early days with Super nation being part of the US I mean, we're learning the <unk> gaming business, but we also.

Unknown Executive: Do know that.

Unknown Executive: The initiatives that.

Unknown Executive: And they have been working on with their business and for their business on the marketing side is has contributed to the strong results that we reported today in their business and Thats why we want to continue those.

Unknown Executive: And.

Unknown Executive: So their focus is, I think, as we've described in the past, not just on the hardcore iGaming player but also on the more entertainment-oriented and kind of fun-oriented gambler is important. So their main brand called Duals is an important part of their product differentiation strategy, which allows, you know, not just, as I said, the really committed gambler, but also other folks who, you know, want to have fun, obviously attempting to win money, but also to be competing against their friends who are also playing and winning the so-called duels or competitions with a group of players. It's all part of the strategy they have, which seems to be working out quite well relative to, you know, the focus on players, you know, going to their brand.

Unknown Executive: They're also very focused on product differentiation as well so their focus is I think.

Unknown Executive: We've described in the past not just on the hardcore I gaming player, but also on the more entertainment oriented.

Unknown Executive: Kind of final oriented gambler is important so their main brand called duals.

Unknown Executive: An important part of their product differentiation strategy, which allows.

Unknown Executive: Not just as I said, the they're really committed gambler, but also other folks who who want to.

Unknown Executive: Have fun, obviously attempting to win money, but also to.

Unknown Executive: The competing against their friends, who are also playing in and winning the so called duals are.

Unknown Executive: Competitions with a group of players. It's all part of the strategy, they have which seems to be working out quite well relative to.

Unknown Executive: The focus on on players going to their brand.

Unknown Executive: Interesting. Got it. You know, I guess the last one just wanted to get your updated thoughts on buybacks going forward. Would you know, are you kind of seeing better uses of cash?

Speaker Change: Interesting got it I.

Speaker Change: I guess last one just wanted to get your updated thoughts on buybacks going forward.

Speaker Change: Or are you kind of seeing better uses of cash I just wanted to get your updated thoughts there.

Unknown Executive: Well, as we've just described in the past, we absolutely, we, the board, our controlling shareholder, absolutely believe the best use of cash, at least for the foreseeable future, our cash, our strong balance sheet, is in, you know, potential acquisition, M&A activity, doing the things that we have done with SuperNation, again, and, you know, we are continuing to look toward opportunities and, you know, we have our screens and our filters and our actions that allow us to take a look at the market and see what companies or businesses are available to help us, you know, grow the business. Great, thank you. Thanks.

Unknown Executive: Well as we've just described in the past we absolutely we the board.

Unknown Executive: Our controlling shareholder absolutely believed the believe the best use of cash at least for the foreseeable future our cash our strong balance sheet is in.

Unknown Executive: The potential acquisition M&A activity doing.

Unknown Executive: Doing the things that we have done with Super nation again and.

Unknown Executive: We are continuing to look toward.

Unknown Executive: Opportunities in.

Unknown Executive: We have our screens and in our filters and our actions that.

Unknown Executive: Allow us to take a look at.

Unknown Executive: The market and see what companies or businesses are available to help.

Unknown Executive: To help us.

Unknown Executive: Grow the business.

Speaker Change: Great. Thank you.

Speaker Change: Thanks, Greg.

Operator: And as a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by. This now concludes the question and answer session. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Speaker Change: Thank you.

Unknown Executive: And as a reminder to ask a question you will need to press star one one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one one again please standby.

Operator: Okay.

Operator: This now concludes the question answer session. Thank.

Operator: Thank you for your participation in today's conference. This does conclude the program you may now disconnect.

Operator: Okay.

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Operator: Okay.

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Operator: Hi.

Operator: Yes.

Operator: Okay.

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