Playtika Q1 2025 Earnings Report

Playtika EPS Results

• Actual EPS: $0.09
• Consensus EPS: $0.11
• Beat/Miss: Missed by -$0.02
• One Year Ago EPS: $0.14

Playtika Revenue Results

• Actual Revenue: $706.00 million
• Expected Revenue: $699.67 million
• Beat/Miss: Beat by +$6.33 million
• YoY Revenue Growth: +8.40%

Playtika Announcement Details

• Quarter: Q1 2025
• Date: 5/8/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, May 8, 2025
• Conference Call Time: 8:30AM ET

Playtika (NASDAQ:PLTK), together with its subsidiaries, develops mobile games in the United States, Europe, Middle East, Africa, Asia pacific, and internationally. The company owns a portfolio of casual and social casino-themed games. It distributes its games to the end customer through various web and mobile platforms and direct-to-consumer platforms. Playtika Holding Corp. was founded in 2010 and is headquartered in Herzliya Pituach, Israel. Playtika Holding Corp. is a subsidiary of Playtika Holding UK II Limited.

Playtika Q1 2025 Earnings Call Transcript

Key Takeaways

• Record Q1 revenue: Playtika generated over $700 million in revenue, marking the highest quarterly total in company history.
• Strong Disney Solitaire launch: The new Disney Solitaire title, launched April 17, is showing best-in-class KPIs and is expected to hit a $100 million run-rate faster than prior hits.
• Bingo Blitz growth: Bingo Blitz achieved all-time high revenues in the quarter, boosted by an American Idol in-game campaign and the launch of a branded game show on television.
• Slotomania challenges: Slotomania experienced outsized year-over-year and sequential declines due to recurring game economy issues, with stabilization efforts under way and new slot titles planned for H2.
• D2C momentum: Direct-to-consumer revenues reached a record $179.2 million (around 30% of total), reinforcing D2C as a key growth driver and margin priority.

Presentation

[Operator]

Good day, and thank you for standing by. Welcome to the Playtica Q1 twenty twenty five Earnings Call. At this time, all participants are in listen only mode. After the speakers' presentation, there will be a question and answer session. To ask a question during the session, you will need to press 11 on your telephone.

[Operator]

You will then hear an automated message advising your hand is raised. To withdraw your question, please press 11 again. Please be advised that today's conference is being recorded. I would now like to hand your conference over to your first speaker today, Tae Lee, SVP, Corporate Finance and Investor Relations. Please go ahead.

[Tae Lee, SVP - Corporate Finance & Investor Relations at Playtika Holding]

Welcome, everyone, and thank you for joining us today for the first quarter twenty twenty five earnings call for Platika Holding Corp. Joining me on the call today are Robert Anticol, cofounder and CEO of Platika and Craig Abrams, Platika's president and chief financial officer. I would like to remind you that today's discussion may contain forward looking statements, including but not limited to the company's anticipated future revenue and operating performance, and more specifically, the future performance of our individual titles, Tysautomania or our recently launched Disney Solitaire. These statements and other comments are not a guarantee of future performance, but rather are subject to risks and uncertainties, some of which are beyond our control. These forward looking statements apply as of today, and you should not rely on them as representing our views in the future.

[Tae Lee, SVP - Corporate Finance & Investor Relations at Playtika Holding]

We undertake no obligation to update these statements after this call. We have posted an accompanying slide deck to our Investor Relations website, which contains information on forward looking statements and non GAAP measures, and we will also post our prepared remarks immediately following the call. For a more complete discussion of the risks and uncertainties, please see our filings with the SEC. With that, I will now turn the call over to Robert.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

Good morning and thank you everyone for joining our call today. I'm pleased to report that Platika achieved a historic milestone in the first quarter, generating over $700,000,000 in revenue, the highest quarterly revenue in our company's history. This performance reflects the strength of our industry leading portfolio of mobile games and our ability to acquire industry leading franchise and help support each acquired studio's growth objectives. Recently, we celebrate our fifteenth anniversary, proof of our lasting business model and industry leadership. Over the years, Playtica has consistently demonstrated resilience and innovation, solidifying our position as the leader in mobile gaming.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

I'm also excited to share that Disney Solitaire had its global launch on April 17. While it's early, the new title is showing very promising signs with some of the best launch KPIs I have seen in years. Our Super Play Studio has a remarkable track record, having successfully launched and scaled two previous games, and Disney Solitaire is poised to be its third hit game. Based on the game's impressive start, I am confident that it will be achieved the $100,000,000 run rate revenues mark faster than Dice Dreams and Domino Dreams. I look forward to sharing more updates on this exciting new franchise in the future.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

I'm incredibly proud of our SUPERPLAY studio for their outstanding work in bringing Disney Solitaire to market in collaboration with Disney. Bingo Blitz has another record breaking quarter, achieving all time high in total revenues and revenues from our direct to consumer platform. As the largest mobile Bingo game and one of the largest casual game in the industry, Bingo Blitz continues to grow the category, attract new audience and benefit from the winner takes most dynamics of the genre. Its enduring performance, more than a decade after the acquisition, it's clear testament to the strength of our live operation and ongoing content innovation. Turning to Slotomania.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

Slotomania's results in the first quarter were disappointing and the outsized decline in year over year performance is a result of several quarters of sequential decline. While we believed we had addressed the game economy issues in January, we have seen the issues resurface, leading to weakness in the game starting at the March. TROTOMANI's revenue will continue to decline in the coming quarter before we start to see improvement. Looking ahead, we are planning to launch our new slot game in the back half of the year. In addition, we are integrating renowned IGT slot titles into our platform, enriching our game offering with the high quality real broad content.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

Following the successful launch of Cleopatra II last December, we introduced Regal Riches this past quarter. With several more launch planned for the rest of the year, stabilizing Slotomania and launching new slot game remained a top strategic priority at Playtica. In closing, I want to thank our team for their hard work. Your efforts have been vital in building our industry leading portfolio of games, which has helped us achieve this milestone of record revenue in the quarter. I look forward to providing updates to our 2025 new game launches.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

I will now turn it over to Craig for a deep dive into our quarterly results.

[Craig Abrahams, President & CFO at Playtika Holding]

Thank you, Robert. Before diving into the financials, I want to update where we are on our growth drivers. We're investing behind our recently acquired titles as well as our leading casual games. Our D2C efforts are showing strong results, and we are excited about introducing new mobile game franchises to the market. As Robert mentioned, Disney Solitaire is off to a very strong start in April and very encouraging as we look at our future pipeline.

[Craig Abrahams, President & CFO at Playtika Holding]

Within our core portfolio, we've experienced revenue declines in our slot titles and our smaller casual games without leadership positions in their respective genres. We are focused on product investments and operating improvements to stabilize Slotomania and our other slot titles, but this will take time. In addition, our leading casual game franchises such as Bingo Blitz, Solitaire Grand Harvest, and June's Journey continue to be franchises we believe we can grow over time. They reflect the kind of category leading evergreen franchises that define long term winners in mobile gaming today. The mobile gaming landscape is evolving with player engagement and revenue increasingly concentrated around established and high performing titles.

[Craig Abrahams, President & CFO at Playtika Holding]

Players are dedicating more time to games that have stood the test of time, drawn by ongoing updates, community engagement, and proven entertainment value. This favors companies like Playtica, operators with a leading diversified portfolio of industry leading games, best in class live ops capabilities, and a proven ability to generate free cash flow at scale. As we navigate this transition, we are making strategic capital allocation decisions aimed at enhancing our financial profile and positioning the company to capitalize on these dynamics. We take pride in our track record of being disciplined operators, consistently making thoughtful investment decisions to optimize our resources and drive revenue growth. We remain committed to identifying opportunities to enhance efficiency and deliver sustainable savings to support our long term success.

[Craig Abrahams, President & CFO at Playtika Holding]

With that, let us get into the details of the quarter. We generated $7.00 $6,000,000 of revenue in the first quarter, an 8.6% sequential increase and an 8.4% year over year increase. The increased overall investment in performance marketing had an impact on our credit adjusted EBITDA margins as we generated credit adjusted EBITDA of 167,300,000 down 9% sequentially and down 9.9% year over year. GAAP net income was $30,600,000 down 42.3% year over year. Our direct to consumer business achieved record revenues once again, as we generated $179,200,000 up 2.6% sequentially and 4.5% year over year.

[Craig Abrahams, President & CFO at Playtika Holding]

The growth in our D2C business was driven by Bingo Blitz, June's Journey, and Salter Grand Harvest, offset by declines from the slot titles. We believe that our D2C business has meaningful growth potential over the next twelve months. Historically, we have targeted 30% of our revenue to come from D2C. It is important to note that many of our games are performing above this mark, and the 30% represented an average. This demonstrates our ability to further grow our D2C business, which we intend to prioritize in the coming quarters.

[Craig Abrahams, President & CFO at Playtika Holding]

This focus will help partially offset some of the margin pressure as we invest in recently acquired higher growth titles. We are confident these efforts will contribute to our margins. To further elaborate on our performance, I want to provide some context around our Q1 results and our outlook for the remainder of the year. In Q1, as is our typical seasonal trend, we experienced higher marketing spend, which along with the losses from the Super Bowl acquisition contributed to a decline in adjusted EBITDA year over year. We expect marketing expenses to decline sequentially in the coming quarters.

[Craig Abrahams, President & CFO at Playtika Holding]

As we evaluate our revenue forecast, we are reaffirming our guidance for the year as the declining trends in our slot games will be offset by growth of casual titles in the portfolio. Turning now to our business results from the quarter. The sequential growth in the quarter was driven by the full quarter contribution from Dice Dreams and Domino Dreams and the continued impressive performance from our largest game Bingo Blitz. Dice Dreams was among our top three games by revenue this past quarter. Bingo Blitz revenue was $162,400,000 up 2.1% sequentially and up 3.1% year over year.

[Craig Abrahams, President & CFO at Playtika Holding]

In q one, Bingo Blitz's performance was driven by several key initiatives. The American Idol campaign, features an exclusive in game collaboration with Lionel Richie, brought significant engagement and excitement to the game. Players enjoyed a unique American Idol experience, competing in bingo challenges and having the chance to win VIP tickets to the American Idol finale. The introduction of a new bingo room featuring a social player versus player experience inspired by American Idol was received positively by our community. This campaign not only boosted player engagement, but also enhanced the game's visibility and appeal, driving a strong marketing effort that successfully attracted new players to the game.

[Craig Abrahams, President & CFO at Playtika Holding]

More recently, we launched our Bingo Blitz branded game show on the Game Share Network. This new series, hosted by Valerie Bertinelli, combines bingo play with trivia challenges. The game show has been well received, bringing the dynamic and social gaming experience of Bingo Blitz to television screens. We anticipate this initiative will help strengthen the Bingo Blitz brand by reaching a broader audience. Slotomania revenue was $111,800,000 down 5.5% sequentially and 17.4% year over year.

[Craig Abrahams, President & CFO at Playtika Holding]

Despite these challenges, our DTC business remains a cornerstone of our success. Slotomania's DTC business demonstrated stable performance quarter over quarter. Our strong connection with our most loyal players has been instrumental in extending the lifecycle of our games far beyond industry standards. DiceStream's revenue was $78,600,000 up 124.5% sequentially compared to a partial quarter of revenue contribution from the Super Play acquisition. This impressive growth reflects the successful integration of Dice Dreams into our portfolio and the strong execution by our teams.

[Craig Abrahams, President & CFO at Playtika Holding]

In Q1, Dice Dreams benefited from several key initiatives that contributed to its robust performance. Our other acquired titles are performing in line with our expectations. We are especially pleased with the ramp up in revenue we have seen from Domino Dreams. The game is gaining traction and we are optimistic about its roadmap as we invest in marketing and content updates to drive monetization. Turning now to specific line items in our P and L for the first quarter.

[Craig Abrahams, President & CFO at Playtika Holding]

Cost of revenue increased 11.5% year over year, driven by our revenue growth and increase in amortization expenses in our P and L resulting from the acquisition of Superplay. Operating expenses increased 19.4%, driven primarily by increased performance marketing spending, also driven by our acquisition of Superfly. R and D decreased by 2.9% year over year. The savings from the expiration of our long term cash compensation program offset increases in hosting expenses and costs associated with outsourced services. Sales and marketing increased 42.8% year over year.

[Craig Abrahams, President & CFO at Playtika Holding]

The increase in sales and marketing was primarily driven by the incremental performance marketing spend from our acquisition of Super Play. We anticipate sequential declines in marketing spend for the remainder of the year. G and A expenses declined 9.2% year over year. The decline was primarily due to the expiration of our long term cash compensation program, which resulted in lower accrued expenses offset by an increase in contingent considerations. As of March 31, we had approximately $514,300,000 in cash, cash equivalents and short term investments.

[Craig Abrahams, President & CFO at Playtika Holding]

We entered into an agreement to extend the maturity of the revolving credit facility from March 2026 to September 2027, subject to the satisfaction of certain conditions, and decreased the aggregate principal amount of the revolving credit facility from $600,000,000 to $550,000,000 Looking at our operating metrics, average DPU increased 15% sequentially and increased 26.2% year over year to 390,000. Average DAU increased 12.5% sequentially, and increased 2.3% year over year to 9,000,000. ARPDAU decreased 2.2% sequentially, and increased 7.4% year over year to $0.87 Finally, we are reaffirming our guidance for the year. We'd be happy to take your questions.

[Operator]

Thank you. At this time, we will conduct a question and answer session. Our first question comes from Doug Krutz of TD Cowen. The floor is yours.

[Doug Creutz, Managing Director at TD Cowen]

Hey, thanks. I wondered if you could talk a little bit more about sort of Disney Solitaire and how that fits into your marketing plans for the year. Obviously, it's great that it's off to a good start. Typically, when you have a new launch, if the KPIs are good, you're willing to pour more marketing revenue into the game to increase the long term value of the game. So how are you sort of balancing that off against your commentary that marketing expenses will be declining sequentially through the year?

[Doug Creutz, Managing Director at TD Cowen]

Thanks.

[Craig Abrahams, President & CFO at Playtika Holding]

Hey, Doug, thank you for

[Craig Abrahams, President & CFO at Playtika Holding]

the question. Obviously, excited about the new franchise and the strong start to the launch. As we look at marketing expenses overall, the first quarter tends to be the largest quarter in terms of marketing spend and it typically goes down sequentially from there. I think as we look at the launch and we weigh it, we obviously have a large portfolio of games And so we're mindful kind of allocating capital towards those games with best ROI.

[Doug Creutz, Managing Director at TD Cowen]

Okay, thanks.

[Operator]

Thank you for your question. One moment, please. Our next question comes from Matt Cost of Morgan Stanley. The line is yours.

[Matthew Cost, Executive Director, Equity Research at Morgan Stanley]

Great. Good morning. Thanks for taking the questions. I guess on Slotomania, you know, it it seems like you're expecting continued declines to that game. How should we think about the path forward to that franchise?

[Matthew Cost, Executive Director, Equity Research at Morgan Stanley]

Is is the new slots game in the pipeline kind of an attempt to to fill the gap from Slotomania or maybe service like a sequel or replacement for it? Or, you know, is there a a plan in place to sort of stabilize lot of mania and throw a lot of investment at some point in the future into that title?

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

Thanks for the question. So we see an issue that runs lot of money in the last year and it's not we never we said to the market and we were sure that last quarter we find a way to stabilize the game. I think in the end of the day, we are the game is suffering for being such a long time in the market without a big change. So now we decide to focus and to change a lot of things in the game to stabilize the game, we change the management of the studio. And for us, it's top priority to stabilize and to grow the game.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

On the other hand, our last launch of a slot game was ten years ago. And in the last ten years, we found ourselves with a lot of content, a lot of interesting content, with a lot of experience, with a lot of knowledge, and we decide to take everything and to bring back the market share that we lost in the last few quarters. This is our mission for us being in the market with a new app in this category, it's a win win situation. So I think to stabilize the game, to fix the issues that we have to launch a new fresh app in this market, I think this is the right step to come back and to grow again in this category. Thank you.

[Matthew Cost, Executive Director, Equity Research at Morgan Stanley]

Great, thanks. And then Craig, you talked about marketing stepping down sequentially in the coming quarters. I guess, there any other puts and takes that we should think about in the phasing of costs through the rest of the year as you integrate Superplay?

[Craig Abrahams, President & CFO at Playtika Holding]

Nothing as it relates to Super Play, but I think as we look at the year, obviously there's opportunities that continue to progress on direct to consumer. I think there's margin potential there, and we're consistently looking at opportunities to further manage expenses. So I think that's the puts and takes between the growth and the casual part of the business as well as managing the declines we've seen in the slot portfolio.

[Matthew Cost, Executive Director, Equity Research at Morgan Stanley]

Okay. Thank you.

[Operator]

Thank you for your question. Our next question comes from Albert Kim from UBS. The floor is yours.

[Albert Kim, Equity Research Associate at UBS Group]

Hi. Thanks for taking the question. Just on the D2C front, last quarter, I believe you talked about Amazon Coins and Governors and Poker is eventually making their way into the D2C channels. Any update on timing? How we should think about the overall D2C mix going from here?

[Albert Kim, Equity Research Associate at UBS Group]

And just to the extent that there are any apps or changes allowing kind of the direct link and the inclusion of third party apps, do you see any changes to D2C adoption rate expectations? Thank you.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

So thanks for the question. D2C for Playtech was always a big advantage. We believed in this a few years ago and we built slowly, slowly our infrastructures and being ready for the situation that today, everyone is speaking about the DC, we see the changes in the market, we're still learning the changes, we're still trying to understand how to react. But one thing I can say, we are all in, we understand, we are ready, we are growing. For us, it's one of the most biggest potential for a more profit to the company, more EBITDA to the company.

[Robert Antokol, CO-Founder, Chairman & CEO at Playtika Holding]

And again, for everyone, everyone speaking about DTC for us is old news. We are starting in a different place than everyone else. And I think, again, for Platika, this is a huge opportunity. And actually, it's really hard to say opportunity because it's already here. Thank you.

[Operator]

Thank you for your questions. At this time, I'm showing no other questions. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Participants

Executives

• Tae Lee, SVP - Corporate Finance & Investor Relations
• Robert Antokol, CO-Founder, Chairman & CEO
• Craig Abrahams, President & CFO

Analysts

• Doug Creutz, Managing Director at TD Cowen
• Matthew Cost, Executive Director, Equity Research at Morgan Stanley
• Albert Kim, Equity Research Associate at UBS Group