Saloni Shankar
Enthusiast Gaming achieved its first profitable quarter in Q3 2024, generating CAD$16.8 million in revenue, marking a significant milestone for the gaming and entertainment company.
Financial Milestone: First Profitable Quarter
The gross profit was assessed at CAD$11.8 million and the adjusted EBITDA reached CAD$100,000, both beating Q3 2023 by CAD$3.6 million.
Gross revenues had dropped to CAD$45.6 million from Q3 2023 as the firm had to redirect its focus on the strategic changes.
The easing up on the low margin video platforms that the company previously offered made perfect sense as doing this created operational efficiencies that translated into cost savings for the business.
Strategic Shifts Drive Operational Efficiency
Operating expenses took a severe plunge in Q3 2024, nearly sliced in half at CAD$12.7 million. This cut helped raise gross margins to 70.3%.
Media and Content continued to be Enthusiast Gaming’s biggest revenue-generating stream with a contribution of CAD$11.9 million. Esports and Entertainment income saw stabilisation with 1.9 million dollar receipts.
Money from subscriptions fell to CAD$2.8 million from CAD$3.7 million in 2023. Direct sales made up CAD$4.8 million showing a strong part of the income.
Highlights and Future Plans
The company secured C$20 million in funding via a four-year loan. This will improve its financial position and help with future expansion plans.
The company gained more visibility through partnerships with big names like NFL Tuesday Night Gaming. The partnership garnered 92.7 million views, a 467% rise compared to last year.
Moving forward, Enthusiast plans to release NHL Puck ‘N Play in the first quarter of 2025. This initiative will draw in hockey fans and broaden the sports-related content.
Esports Success and Subscriber Growth
The Sims Resource, or TSR, had steady growth in subscriber acquisition during this reporting period and clearly falls under a very valuable asset in the Enthusiast Group portfolio.
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CFO Statement
Felicia DellaFortuna CFO praised the results:
“This quarter, we improved some of our key metrics reaching profitability at the Adjusted EBITDA level, and strengthening our balance sheet.”
In her words, “We’ve cut costs by over $20 million and boosted our gross margin to 70.3% so far this year setting us up for quick and profitable growth.”
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