Allied Gaming & Entertainment Inc (AGAE) 2023 Q1 法說會逐字稿

Good afternoon and welcome to the Allied Gaming & Entertainment Inc. first-quarter 2023 earnings conference call. (Operator Instructions) Please note this event is being recorded.

下午好，歡迎來到 Allied Gaming & Entertainment Inc. 2023 年第一季度收益電話會議。 （操作員說明）請注意正在記錄此事件。

I would now like to turn the conference over to Tyler Drew, Addo Investor Relations. Please go ahead.

我現在想將會議轉交給 Addo 投資者關係部的 Tyler Drew。請繼續。

Thank you, operator. Good afternoon and welcome to the Allied Gaming & Entertainment 2023 first-quarter earnings conference. Speaking on the call today are Allied Gaming & Entertainment's Chief Executive Officer, Yinghua Chen; and Chief Financial Officer, Roy Anderson.

謝謝你，運營商。下午好，歡迎來到 Allied Gaming & Entertainment 2023 第一季度財報會議。今天在電話會議上發言的是 Allied Gaming & Entertainment 的首席執行官 Yinghua Chen；和首席財務官 Roy Anderson。

Before I turn the call over to management, please note that our prepared remarks may contain forward-looking statements. Words such as may, will, expect, intend, plan, believe, seek, could, estimate, judgment, targeting, should, anticipate, goal, and variations of these words and similar expressions are intended to identify forward-looking statements.

在我將電話轉交給管理層之前，請注意我們準備好的評論可能包含前瞻性陳述。可能、將、預期、打算、計劃、相信、尋求、可能、估計、判斷、目標、應該、預期、目標以及這些詞的變體和類似表達旨在識別前瞻性陳述。

Actual results could differ materially from those implied by such forward-looking statements due to a variety of factors discussed in the company's public filings, including the risk factors discussed in documents filed with the Securities and Exchange Commission. Although the company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be attained.

由於公司公開文件中討論的各種因素，包括向美國證券交易委員會提交的文件中討論的風險因素，實際結果可能與此類前瞻性陳述所暗示的結果存在重大差異。儘管公司認為此類前瞻性陳述中反映的預期是基於合理的假設，但無法保證其預期會實現。

The company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise. In addition, certain of the financial information presented in this call represents non-GAAP financial measures. The company's earnings release, which was issued this afternoon and is available on the company's website, presents definitions of such non-GAAP financial measures, reconciliations to the appropriate GAAP measures, and an explanation of why the company believes such non-GAAP financial measures are useful to investors.

公司不承擔更新任何前瞻性陳述的義務，無論是由於新信息、未來事件或其他原因。此外，本次電話會議中提供的某些財務信息代表了非 GAAP 財務措施。公司於今天下午發布並可在公司網站上查閱的收益報告介紹了此類非 GAAP 財務措施的定義、與適當的 GAAP 措施的對賬，並解釋了為什麼公司認為此類非 GAAP 財務措施是對投資者有用。

With that, it is now my pleasure to turn the call over to Allied Gaming & Entertainment CEO, Yinghua Chen. Yinghua?

因此，現在我很高興將電話轉給 Allied Gaming & Entertainment 首席執行官 Yinghua Chen。英華？

Thank you, Taylor. Good afternoon to you, all, and thank you for joining us today. I'm very excited to provide update on Allied's strong start to the year and our continued momentum into the second quarter and the remainder of 2023.

謝謝你，泰勒。大家下午好，感謝你們今天加入我們。我很高興向大家介紹 Allied 今年的強勁開局以及我們在第二季度和 2023 年剩餘時間內的持續發展勢頭。

As we spoke to on our last quarterly conference call, Allied is now laser-focused on leveraging our renowned assets, products, and services to provide the rapidly growing world of gamers, with new and unique experiences as the entertainment landscape continue to evolve. We recognize it is crucial to provide consumers with captivating and stimulating experiences in various formats to compete with the increasing number of entertainment options available.

正如我們在上次季度電話會議上所說的那樣，Allied 現在專注於利用我們知名的資產、產品和服務，隨著娛樂領域的不斷發展，為快速增長的遊戲玩家提供全新和獨特的體驗。我們認識到，以各種形式為消費者提供迷人和刺激的體驗以與越來越多的可用娛樂選擇競爭至關重要。

We are uniquely positioned to capitalize on this ongoing shift and, in turn, help brands connect with consumers in most cost-effective ways. As evidence of this shift, Gallup reports that fully engaged consumers represent a 23% premium in share of wallet, profitability, revenue, and relationship growth over the average customers. Our live events, both in-person and virtual, and the associated brand activations are carefully designed to achieve this engagement and leave lasting impressions for participants, who often become our loyal customers.

我們具有獨特的優勢，可以利用這種持續的轉變，進而幫助品牌以最具成本效益的方式與消費者建立聯繫。作為這種轉變的證據，蓋洛普報告稱，充分參與的消費者在錢包份額、盈利能力、收入和關係增長方面比普通客戶高出 23%。我們的現場和虛擬現場活動以及相關的品牌活動都經過精心設計，以實現這種參與並為參與者留下持久的印象，而參與者通常會成為我們的忠實客戶。

Speaking of events, let's now turn to our in-person events during the quarter, starting with our flagship venue, HyperX Arena, located at Luxor Hotel, Las Vegas. Demand remains strong, and we produced a total of 82 events, comprising 42 proprietary events and 40 third-party events, with the latter recording a 5.3% increase compared to the first quarter of 2022. Notable third-party events include HyperX CES Event, Nighthawk Picture Production, View Sonic Event, ReliaQuest, [Level Up], and Astral Clash just to name a few.

說到活動，現在讓我們談談本季度的現場活動，首先是位於拉斯維加斯盧克索酒店的旗艦場地 HyperX Arena。需求依然強勁，我們共舉辦了 82 場活動，其中包括 42 場自有活動和 40 場第三方活動，後者比 2022 年第一季度增長了 5.3%。值得注意的第三方活動包括 HyperX CES Event， Nighthawk Picture Production、View Sonic Event、ReliaQuest、[Level Up] 和 Astral Clash 僅舉幾例。

Following another successful quarter, we were thrilled to announce the renewal of our exclusive naming rights agreement with HP HyperX, along with the total naming peripherals upgrade. This multiyear agreement will enable us to continue working with HP HyperX, who has been an incredible partner over the years, and also ensures that our flagship arena will remain branded as HyperX Arena Las Vegas.

在又一個成功的季度之後，我們很高興地宣布與 HP HyperX 續簽我們的獨家命名權協議，同時對整個命名外圍設備進行升級。這份多年期協議將使我們能夠繼續與 HP HyperX 合作，HP HyperX 多年來一直是令人難以置信的合作夥伴，同時也確保我們的旗艦場館將保留 HyperX Arena Las Vegas 的品牌。

HP HyperX will receive prominent branding and signage inside and outside of the venue, as well as across all arena promotions, content, and social media platforms. In addition, we will continue to partner on a variety of co-branded experiences and events at the arena, focused on growing gaming and esports communities. Excitingly, the top line of HP Omen PCs and monitors will also be used to retrofit and update the gaming zones within the HyperX arena, which is yet another way we will further enhance gamers' and viewers' experiences.

HP HyperX 將在場館內外以及所有場館促銷、內容和社交媒體平台上獲得顯著的品牌和標牌。此外，我們將繼續在競技場上開展各種聯合品牌體驗和活動，重點是發展遊戲和電子競技社區。令人興奮的是，HP Omen PC 和顯示器的頂級產品線也將用於改造和更新 HyperX 競技場內的遊戲區，這是我們進一步提升遊戲玩家和觀眾體驗的另一種方式。

As part of the expansion of the agreement, HP Omen will now also sponsor our Allied mobile esports truck, which includes prominent branding and signage on the truck as well as HP HyperX gaming equipment. The renewal and expansion of this partnership is -- further proves that brands see the value and the reach of our business model.

作為協議擴展的一部分，HP Omen 現在還將贊助我們的 Allied 移動電子競技卡車，其中包括卡車上的醒目品牌和標牌以及 HP HyperX 遊戲設備。這種夥伴關係的更新和擴展是——進一步證明品牌看到了我們商業模式的價值和影響範圍。

We are also making progress on producing more of our own live shows from the arena, which focuses on highly engaged live and virtual experiences and really brings together all of Allied's unique assets and content capabilities. We will look to generate revenues through multiple channels together with content creators and influencers who will join us in these shows, many of whom we have pre-established relationships with. We're in the process of testing to deliver these events and are targeting to bring them to market in the third quarter.

我們還在競技場製作更多我們自己的現場表演方面取得了進展，它專注於高度參與的現場和虛擬體驗，真正匯集了 Allied 的所有獨特資產和內容能力。我們將與內容創作者和有影響力的人一起尋求通過多種渠道產生收入，他們將加入我們參加這些節目，我們已經與他們中的許多人預先建立了關係。我們正在測試交付這些事件，目標是在第三季度將它們推向市場。

Moving on to our original content program. Season two of Elevated sponsored by Progressive Insurance debuted the first two of its 10 episodes last week. This season, we're joining forces with One True King or OTK, the award-winning gaming and entertainment content collective and one of the most watched organizations on Twitch.

繼續我們的原創內容計劃。上週，Progressive Insurance 贊助的 Elevated 第二季首播了 10 集中的前兩集。本賽季，我們將與 One True King 或 OTK 聯手，OTK 是屢獲殊榮的遊戲和娛樂內容集體，也是 Twitch 上最受關注的組織之一。

Each episode of Elevated will be hosted by different OTK members who have a collective reach of more than 35 million followers across their channels. Season one brought in more than 10 million live views and three million VOD views over just four episodes. And we're excited to see these numbers rise with a full 10-episode slate and our new collaboration with OTK.

Elevated 的每一集都將由不同的 OTK 成員主持，這些成員在其頻道中擁有超過 3500 萬粉絲。第一季僅四集就帶來了超過 1000 萬的現場觀看和 300 萬的 VOD 觀看。我們很高興看到這些數字隨著完整的 10 集節目和我們與 OTK 的新合作而上升。

Our other original series, WANNABE, is available on the Emmy Award-winning YES app, which has a reach of 9.3 million homes. We also have plans to continue season two production, which will include participation from the outstanding winners from our Elevated show and further build up the value we bring to our partners and viewers by fully utilizing our unique assets and resources to grow content creators and gaming entertainment communities.

我們的其他原創劇集 WANNABE 可在獲得艾美獎的 YES 應用程序上觀看，該應用程序已覆蓋 930 萬家庭。我們還計劃繼續製作第二季，其中將包括我們 Elevated 節目的傑出獲獎者的參與，並通過充分利用我們獨特的資產和資源來培養內容創作者和遊戲娛樂，進一步建立我們為合作夥伴和觀眾帶來的價值社區。

We will continue to expand our content offering and have a strong pipeline of original content to be released in the near future. We look forward to updating you further on future season as they are brought to the market.

我們將繼續擴大我們的內容供應，並在不久的將來發布大量原創內容。我們期待著在未來的季節將它們推向市場時為您提供進一步的更新。

Last, but certainly not least, we are continuing our efforts to identify appropriate opportunities in the mobile gaming space. We have seen mobile gaming generate over 90 billion in revenue in 2021, which equates to more than 50% of the global gaming market and is expected to grow at a CAGR of more than 12% through 2026. We're looking to take advantage of the opportunities and expand into this quickly growing market. We look forward to engaging with consumers with our new product offerings as soon as they become available.

最後但並非最不重要的一點是，我們將繼續努力在移動遊戲領域尋找合適的機會。我們已經看到移動遊戲在 2021 年產生了超過 900 億美元的收入，相當於全球遊戲市場的 50% 以上，並且預計到 2026 年將以超過 12% 的複合年增長率增長。我們希望利用機會並擴展到這個快速增長的市場。我們期待在新產品上市後儘快與消費者互動。

Before I turn the call over to Roy, I'd like to reiterate that we maintain the belief that our stock price is undervalued. To that end and under our share repurchase plan announced in November, we repurchased approximately $2 million of AGE (sic, "AGAE") stock in total up to Q1 2023.

在我把電話轉給羅伊之前，我想重申，我們仍然相信我們的股價被低估了。為此，根據我們去年 11 月宣布的股票回購計劃，截至 2023 年第一季度，我們共回購了約 200 萬美元的 AGE（原文如此，“AGAE”）股票。

In summary, we remain confident in the strategic shift of our business, and we're seeing encouraging results from our early work. Allied is trusted in the gaming community. And as we continue to build out and expand on our assets and capabilities, we are well positioned to further validate this trust and become the go-to name for gaming consumers as well as the brands that aspire to reach them.

總而言之，我們對業務的戰略轉變充滿信心，我們從早期的工作中看到了令人鼓舞的成果。 Allied 在遊戲社區中備受信賴。隨著我們繼續建立和擴展我們的資產和能力，我們有能力進一步驗證這種信任，並成為遊戲消費者以及渴望接觸他們的品牌的首選品牌。

With that, I'd like to turn the call now to our CFO, Roy Anderson, to give you updates on our Q1 financials.

有了這個，我現在想把電話轉給我們的首席財務官 Roy Anderson，向您提供我們第一季度財務狀況的最新信息。

Thank you, Yinghua. Total first-quarter revenues of $1.2 million were essentially flat from the fourth quarter of 2022 and down from $2.4 million for the first quarter of 2022. The year-over-year decline is primarily attributable to the timing of our original content series, Elevated. Season one, which consisted of four episodes, was launched and entirely recognized in the first quarter of 2022. Season two, with 10 episodes, will be distributed and recognized in full in the second quarter of 2023.

謝謝你，英華。第一季度的總收入為 120 萬美元，與 2022 年第四季度基本持平，低於 2022 年第一季度的 240 萬美元。同比下降主要是由於我們的原創內容系列 Elevated 的時間安排。第一季由四集組成，於 2022 年第一季度推出並獲得全面認可。第二季共 10 集，將於 2023 年第二季度全面發行並獲得認可。

This timing issue was partially offset by a 9.5% year-over-year increase in revenues from proprietary and third-party events held at the company's HyperX Arena Las Vegas and in our Allied esports truck operations.

這一時間問題被在公司的 HyperX Arena Las Vegas 和我們的 Allied 電競卡車業務中舉辦的專有和第三方活動的收入同比增長 9.5% 所部分抵消。

Total costs and expenses for the fourth quarter of 2023 were $3.8 million, a decrease of $2.3 million or 38% compared to the first quarter of 2022. The costs and expenses decreased, in large part, due to timing and accounting expense recognition of Elevated, as well as a 26% reduction in our general and administrative expenses, principally cash, severance, and stock-based compensation.

2023 年第四季度的總成本和費用為 380 萬美元，比 2022 年第一季度減少 230 萬美元或 38%。成本和費用的減少在很大程度上是由於 Elevated 的時間安排和會計費用確認，以及我們的一般和管理費用減少 26%，主要是現金、遣散費和基於股票的補償。

Net loss for the first quarter of 2023 was $1.9 million compared to a net loss of $3.8 million in the prior year period. Our results for Q1 2023 included approximately $734,000 of interest income earned on short-term investments.

2023 年第一季度的淨虧損為 190 萬美元，而去年同期為淨虧損 380 萬美元。我們 2023 年第一季度的業績包括約 734,000 美元的短期投資利息收入。

Adjusted EBITDA loss was $2 million for the first quarter of 2023, a 20% reduction as compared with a loss of $2.5 million in Q1 2022. Our adjusted EBITDA includes adjustments for depreciation, amortization, stock-based compensation, and interest income.

2023 年第一季度調整後的 EBITDA 虧損為 200 萬美元，與 2022 年第一季度的虧損 250 萬美元相比減少了 20%。我們調整後的 EBITDA 包括對折舊、攤銷、股票薪酬和利息收入的調整。

Now moving on to our balance sheet. As of March 31, 2023, our cash and short-term investments position totaled $84.4 million, including $5 million of restricted cash, compared to $86.8 million at December 31, 2022, which also included $5 million of restricted cash. As of March 31, 2023, the company's working capital position was $75.6 million, including the current portion of an operating lease liability of $1.3 million that was recorded in connection with the implementation of the new leasing standard, ASC 842, on December 31, 2022.

現在轉到我們的資產負債表。截至 2023 年 3 月 31 日，我們的現金和短期投資頭寸總計 8440 萬美元，包括 500 萬美元的受限現金，而 2022 年 12 月 31 日為 8680 萬美元，其中還包括 500 萬美元的受限現金。截至 2023 年 3 月 31 日，公司的營運資金狀況為 7560 萬美元，包括與 2022 年 12 月 31 日實施新租賃標準 ASC 842 相關的 130 萬美元經營租賃負債的流動部分.

Also during the quarter and under our stock repurchase program, we acquired 1,105,604 shares of our common stock in open market transactions at an average selling price of $1.26 for a total repurchase cost of $1.43 million, excluding broker fees. This brings us to a total of $2.02 million in repurchases since the commencement of the plan. Moving forward, the manner, timing, and amount of any purchases will continue to be based on an evaluation of market conditions, stock price, and other factors.

同樣在本季度，根據我們的股票回購計劃，我們在公開市場交易中以 1.26 美元的平均售價收購了 1,105,604 股普通股，總回購成本為 143 萬美元，不包括經紀人費用。自計劃啟動以來，這使我們的回購總額達到 202 萬美元。展望未來，任何購買的方式、時間和數量將繼續基於對市場狀況、股票價格和其他因素的評估。

Overall, it was a solid quarter at Allied. And we are trending well so far in Q2 as we begin recognizing revenue from season two of Elevated and continue moving forward on our strategic plan. I will now turn the call back over to Yinghua for closing remarks.

總的來說，Allied 是一個穩定的季度。到目前為止，我們在第二季度的趨勢良好，因為我們開始確認 Elevated 第二季的收入，並繼續推進我們的戰略計劃。我現在將把電話轉回給英華作結束語。

Thank you, Roy. These are exciting times at AGAE as we build out our ecosystem for the gaming community and expand our partnership with world-class companies, who understand the market potential. It is becoming clear to brands that we are an established name in the gaming community and offer an inroad to this crucial and growing multibillion-dollar marketplace.

謝謝你，羅伊。這是 AGAE 激動人心的時刻，因為我們為遊戲社區構建了我們的生態系統，並擴大了我們與了解市場潛力的世界級公司的合作夥伴關係。品牌越來越清楚，我們是遊戲社區中的知名品牌，並為這個至關重要且不斷增長的數十億美元市場提供了入口。

Looking ahead, we will remain focused on expanding our capabilities and providing gamers with engaging touchpoints across the entire gaming ecosystem. Thank you for joining us today as well as your continued support. We look forward to speaking with you again to discuss our second-quarter results in August.

展望未來，我們將繼續專注於擴展我們的能力，並在整個遊戲生態系統中為遊戲玩家提供引人入勝的接觸點。感謝您今天加入我們以及您一直以來的支持。我們期待再次與您交談，討論我們 8 月份的第二季度業績。

The conference has now concluded. Thank you for attending today's presentation, and you may now disconnect.

會議現已結束。感謝您參加今天的演講，您現在可以斷開連接了。