DoubleDown Interactive Co Ltd (DDI) 2022 Q4 法說會逐字稿

Good afternoon, and welcome to DoubleDown's earnings conference call for the financial results for the fourth quarter and full year ended December 31, 2022. My name is Victor, and I will be your operator this afternoon.

下午好，歡迎來到 DoubleDown 的財報電話會議，了解截至 2022 年 12 月 31 日的第四季度和全年的財務業績。我叫維克多，今天下午我將是你的接線員。

Prior to this call, DoubleDown issued its unaudited financial results for the fourth quarter and full year 2022 in a press release, a copy of which has been furnished in a report on Form 6-K filed with the SEC and is available in the Investor Relations section of the company's website at www.doubledowninteractive.com. You can find a link to the Investor Relations section at the top of the home page. Joining us on today's call are DoubleDown's CEO, Mr. In Keuk Kim; and its CFO, Mr. Joe Sigrist. Following their remarks, we will open the call for questions.

在此電話會議之前，DoubleDown 在新聞稿中發布了其第四季度和 2022 年全年未經審計的財務業績，其副本已在向美國證券交易委員會提交的 6-K 表格報告中提供，可在投資者關係中查閱公司網站 www.doubledowninteractive.com 的部分。您可以在主頁頂部找到指向“投資者關係”部分的鏈接。與我們一起參加今天電話會議的還有 DoubleDown 的首席執行官 In Keuk Kim 先生；及其首席財務官 Joe Sigrist 先生。在他們發言之後，我們將開始提問。

Before we begin, Mr. Grampp, the company's outside Investor Relations adviser, will make a brief introductory statement. Mr. Grampp?

在我們開始之前，公司的外部投資者關係顧問 Grampp 先生將做一個簡短的介紹性發言。格蘭普先生？

Thank you. Before management begins their 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 we hereby claim the protection of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

謝謝。在管理層開始正式發言之前，我們需要提醒大家，今天管理層的一些評論將是經修訂的 1933 年證券法第 27A 條和經修訂的 1934 年證券交易法第 21E 條含義範圍內的前瞻性陳述，我們特此要求保護 1995 年《私人證券訴訟改革法》的安全港條款。

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, believe, intend, estimate, continue, should, anticipate or other similar terms. 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.

前瞻性陳述是關於未來事件的陳述，包括不存在的預期和預測或歷史事實，可以通過使用諸如可能、可能、將、預期、假設、相信、打算、估計、繼續、應該、預期或其他類似術語。前瞻性陳述包括但不限於有關公司未來計劃、併購戰略、戰略和財務目標、預期業績和財務前景的陳述。

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. We refer you to DoubleDown's annual report on Form 20-F filed with the SEC on April 4, 2022, and other SEC filings for a more detailed discussion of the risks that could impact future operating results and financial condition.

前瞻性陳述受眾多風險和不確定因素的影響，這些風險和不確定因素可能導致實際結果與公司預期產生重大不利差異。因此，您在解釋和依賴它們時應謹慎行事。我們建議您參閱 DoubleDown 於 2022 年 4 月 4 日向美國證券交易委員會提交的 20-F 表格年度報告，以及其他提交給美國證券交易委員會的文件，以更詳細地討論可能影響未來經營業績和財務狀況的風險。

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.

這些前瞻性陳述僅在本次電話會議之日作出。公司不承擔並明確否認任何更新或更改前瞻性陳述的義務，無論是由於新信息、未來事件或其他原因，除非法律要求。

During the call, management will discuss non-GAAP measures, which are believed by the management to be useful in evaluating the company's operating performance. These measures should not be considered superior to, in isolation or as a substitute for the financial results prepared in accordance with GAAP. A full reconciliation of these measures to the most directly comparable GAAP measure is available in the earnings release and on our Form 6-K filed with the SEC prior to this call.

在電話會議期間，管理層將討論非 GAAP 指標，管理層認為這些指標有助於評估公司的經營業績。這些措施不應被視為優於、孤立地或替代根據公認會計原則編制的財務結果。這些措施與最直接可比的 GAAP 措施的全面對賬可在收益發布和我們在本次電話會議之前向美國證券交易委員會提交的 6-K 表格中找到。

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 DoubleDown's website.

我想提醒大家，這個電話正在錄音中，可以通過 DoubleDown 網站投資者關係部分的鏈接進行重播。

Now I would like to turn the call over to DoubleDown's CEO, In Keuk Kim.

現在我想把電話轉給 DoubleDown 的首席執行官 In Keuk Kim。

Thank you, Jeff. Good afternoon, everyone. Thank you for joining us on the earnings call for our fourth quarter and full year 2022 financial results. We had another solid quarter as we finished the first quarter with strong cash flow generation of $29.1 million when excluding a $50 million payment associated with the Benson settlement and an adjusted EBITDA margin of over 30%, which has continued to demonstrate the effectiveness of our high-margin, capital-light business model.

謝謝你，傑夫。大家下午好。感謝您參加我們第四季度和 2022 年全年財務業績的財報電話會議。我們有另一個穩定的季度，因為我們在第一季度結束時產生了 2910 萬美元的強勁現金流，其中不包括與 Benson 和解相關的 5000 萬美元付款和超過 30% 的調整後 EBITDA 利潤率，這繼續證明了我們高水平的有效性-毛利、輕資本的商業模式。

During 2022, we were able to achieve our full year revenue of $321 million, representing an increase of over 17% compared to full year 2019 revenue, the most recent pre-pandemic comparable period. We believe our proven ability to maintain our revenue above the pre-COVID level is a validation of our success in capturing and retaining growth in our customer base and player spending over the past several years.

2022 年，我們實現了 3.21 億美元的全年收入，與 2019 年全年收入相比增長了 17% 以上，這是最近的大流行前可比時期。我們相信，我們將收入維持在 COVID 之前水平之上的能力證明了我們在過去幾年中成功地抓住並保持了客戶群和玩家支出的增長。

In addition to maintaining a strong base business in social casino, we also recently announced our upcoming entry into the i-Gaming space in Europe with our planned acquisition of SuprNation, which we announced last month. SuprNation is a European-based i-Gaming company that provides differentiated online casino gaming experiences. We entered into a purchase agreement to acquire the business for approximately $35 million in cash, subject to certain closing adjustments with closing expected during the second quarter of 2023. SuprNation generated estimated revenue of $18.3 million in the first 9 months of 2022. We were impressed by their game development, in particular, their flagship title, Duelz.com, which offers real money gaming with unique peer-to-peer gamification and social features that we believe will improve monetization and engagement.

除了在社交賭場保持強大的基礎業務外，我們最近還宣布我們即將進入歐洲的 i-Gaming 領域，我們計劃收購 SuprNation，這是我們上個月宣布的。 SuprNation 是一家位於歐洲的 i-Gaming 公司，提供差異化的在線賭場遊戲體驗。我們簽訂了一項購買協議，以約 3500 萬美元的現金收購該業務，但會進行某些收盤調整，預計將於 2023 年第二季度完成。SuprNation 在 2022 年前 9 個月的收入估計為 1830 萬美元。我們印象深刻通過他們的遊戲開發，特別是他們的旗艦遊戲 Duelz.com，它提供具有獨特點對點遊戲化和社交功能的真錢遊戲，我們相信這將提高貨幣化和參與度。

The acquisition of SuprNation is a key strategic move for us as we diversify our revenue streams into new geographies and gaming subsectors for which we can still leverage our core competencies, specifically our deep online gaming experience, marketing and customer acquisition capabilities and development of engaging gaming experience for our loyal customers. We look forward to working with the SuprNation team to quickly initiate projects to capture synergy and growth opportunities once the acquisition is closed. Currently, SuprNation's largest markets are Sweden and Great Britain, although it also maintains licenses Malta and the Isle of Man. After closing, we intend to continue to support SuprNation in its existing markets, and we may also evaluate additional strategic expansions into other regulated gaming jurisdictions.

收購 SuprNation 對我們來說是一個關鍵的戰略舉措，因為我們將收入來源多元化到新的地區和遊戲子行業，我們仍然可以利用我們的核心競爭力，特別是我們深厚的在線遊戲體驗、營銷和客戶獲取能力以及參與遊戲的開發為我們忠實的客戶提供體驗。我們期待與 SuprNation 團隊合作，在收購完成後迅速啟動項目，以捕捉協同效應和增長機會。目前，SuprNation 最大的市場是瑞典和英國，儘管它還持有馬耳他和馬恩島的許可證。關閉後，我們打算繼續在其現有市場支持 SuprNation，我們還可能評估向其他受監管的博彩司法管轄區的額外戰略擴張。

Additionally, we have been focused on our own app development at DoubleDown as we recently initiated the soft launch of our new Spinning in Space gaming app following its recent open beta period. Spinning in Space has both casino and non-casino elements. So we believe it can be an engaging game both for our existing customer base as well as new customers. Looking further ahead, we plan for additional launches of new games in 2023 while continuing our lengthy track record of positive cash generation based on our strength in social casino.

此外，我們在 DoubleDown 一直專注於我們自己的應用程序開發，因為我們最近在最近的公開測試期之後啟動了我們新的 Spinning in Space 遊戲應用程序的軟啟動。 Spinning in Space 既有賭場元素，也有非賭場元素。因此，我們相信對於我們現有的客戶群和新客戶來說，這都是一款引人入勝的遊戲。展望未來，我們計劃在 2023 年推出更多新遊戲，同時根據我們在社交賭場的實力，繼續我們長期的積極現金產生記錄。

Now I will turn it over to our CFO, Joe Sigrist, to walk you through our financials before providing my closing remarks. Joe?

現在我將把它交給我們的首席財務官 Joe Sigrist，在提供我的結束語之前向您介紹我們的財務狀況。喬？

Thank you, IK, and good afternoon, everyone. Our revenues for the fourth quarter of 2022 decreased 12% to $76.2 million from the prior year period. For the full year of 2022, revenue also decreased 12% to $321.0 million. These decreases were primarily due to the further normalization of player activities after the lifting of stay-at-home orders and other COVID-related restrictions compared to the prior year as well as changes in player behaviors relating to inflation and global economic concerns during 2022.

謝謝 IK，大家下午好。我們 2022 年第四季度的收入比去年同期下降 12% 至 7620 萬美元。 2022 年全年收入也下降 12% 至 3.21 億美元。這些減少主要是由於與上一年相比，在取消居家令和其他與 COVID 相關的限制後，球員活動進一步正常化，以及 2022 年與通貨膨脹和全球經濟擔憂相關的球員行為發生了變化。

Despite this revenue decrease, we still generated very healthy key monetization metrics. Specifically, average revenue per daily active user, or ARPDAU, increased from $0.96 in Q4 2021 to $0.98 in Q4 2022. And ARPDAU for the full year 2022 stayed consistent at $0.97 compared to the full year 2021. Average monthly revenue per payer increased from $216 in Q4 2021 to $227 in Q4 2022, and average monthly revenue per payer for the full year 2022 increased to $226 compared to $218 for the full year 2021. Lastly, payer conversion ratio, which is the percentage of players who pay DoubleDown, was down slightly from 5.5% in Q4 2021 to 5.4% in Q4 2022. For the full year 2022, payer conversion ratio decreased to 5.3% from 5.7% in 2021.

儘管收入下降，但我們仍然產生了非常健康的關鍵貨幣化指標。具體而言，每日活躍用戶平均收入 (ARPDAU) 從 2021 年第四季度的 0.96 美元增加到 2022 年第四季度的 0.98 美元。與 2021 年全年相比，2022 年全年的 ARPDAU 保持在 0.97 美元。每位付款人的平均每月收入從 216 美元增加在 2021 年第四季度增加到 2022 年第四季度的 227 美元，2022 年全年每個付款人的平均月收入從 2021 年全年的 218 美元增加到 226 美元。最後，付款人轉化率，即支付 DoubleDown 的玩家的百分比，下降了從 2021 年第四季度的 5.5% 略微降至 2022 年第四季度的 5.4%。2022 年全年，付款人轉換率從 2021 年的 5.7% 降至 5.3%。

Total operating expenses increased from $62.7 million in the fourth quarter of 2021 to $321.4 million in the fourth quarter of 2022. The increase was due primarily to a $269.9 million noncash impairment of goodwill. This impairment was made in accordance with U.S. GAAP, which requires us to regularly evaluate the value we ascribe to the goodwill on our balance sheet. The noncash goodwill impairment was a result of the decrease in the market price of our ADSs in 2022.

總運營費用從 2021 年第四季度的 6270 萬美元增加到 2022 年第四季度的 3.214 億美元。增加的主要原因是商譽的 2.699 億美元非現金減值。這種減值是根據美國公認會計原則進行的，這要求我們定期評估我們在資產負債表上賦予商譽的價值。非現金商譽減值是由於 2022 年我們的 ADS 市場價格下降所致。

It is important to note that this impairment is purely driven by accounting principles, is noncash and has no fundamental impact to our business. The overall increase in fourth quarter 2022 operating expenses was partially offset by lower cost of revenues and decreased marketing expenditures. Excluding the onetime goodwill impairment charge, operating costs for the fourth quarter would have decreased to $51.5 million, primarily due to lower cost of revenues and decreased marketing expenditures.

重要的是要注意，這種減值純粹是由會計原則驅動的，是非現金的，對我們的業務沒有根本影響。 2022 年第四季度運營費用的總體增長被較低的收入成本和減少的營銷支出部分抵消。不包括一次性商譽減值費用，第四季度的運營成本將下降至 5150 萬美元，這主要是由於收入成本降低和營銷支出減少。

For the full year 2022, total operating expenses were $634.9 million, an increase from $264.5 million in the prior year period. The increase was primarily driven by the noncash goodwill impairment I previously mentioned, along with a charge of $141.75 million, reflecting the incremental charge in 2022 associated with the agreement in principle to settle the Benson class action complaint and associated proceedings. As many of you know, DoubleDown agreed to contribute $145.25 million in the settlement of the Benson case, which was announced on August 29 of last year. Excluding these onetime nonrecurring charges, operating expenses in 2022 would have decreased to $233.3 million, primarily due to lower cost of revenues, decreased marketing expenditures and lower depreciation and amortization expenses.

2022 年全年，總運營費用為 6.349 億美元，高於上年同期的 2.645 億美元。增加的主要原因是我之前提到的非現金商譽減值以及 1.4175 億美元的費用，反映了 2022 年與原則上達成和解 Benson 集體訴訟投訴及相關訴訟的協議相關的增量費用。眾所周知，DoubleDown 同意在去年 8 月 29 日宣布的 Benson 案的和解中出資 1.4525 億美元。不包括這些一次性的非經常性費用，2022 年的運營費用將減少至 2.333 億美元，這主要是由於收入成本降低、營銷支出減少以及折舊和攤銷費用減少。

Sales and marketing expenses for the fourth quarter of 2022 were $16.9 million, a 23% reduction compared to Q4 2021. You may recall that in Q4 2021, we ramped up spending for Undead World: Hero Survival but have since reduced investment on that title. For the full year 2022, sales and marketing expenses were $71.9 million compared to sales and marketing expenses of $78.8 million for full year 2021.

2022 年第四季度的銷售和營銷費用為 1690 萬美元，與 2021 年第四季度相比減少了 23%。您可能還記得，在 2021 年第四季度，我們增加了對《亡靈世界：英雄生存》的支出，但此後減少了對該遊戲的投資。 2022 年全年銷售和營銷費用為 7190 萬美元，而 2021 年全年銷售和營銷費用為 7880 萬美元。

It is also worth noting that depreciation and amortization expenses in Q4 2022 were $50,000 compared to $2.2 million in Q4 2021 and were $3.8 million for the full year 2022 compared to $17.9 million for the full year 2021. The decreases were due to the completed amortization of certain identifiable intangible assets for which we use purchase price allocation at the time of the 2017 DoubleDown Interactive acquisition.

還值得注意的是，2022 年第四季度的折舊和攤銷費用為 50,000 美元，而 2021 年第四季度為 220 萬美元；2022 年全年的折舊和攤銷費用為 380 萬美元，而 2021 年全年為 1790 萬美元。減少的原因是已完成攤銷我們在 2017 年 DoubleDown Interactive 收購時使用購買價格分配的某些可識別無形資產。

We recorded a net loss of $194.4 million for the fourth quarter of 2022 or a loss of $78.47 per diluted share and $3.92 per ADS compared to a net income of $17.4 million or $7.04 per diluted share and $0.35 per ADS in the fourth quarter of 2021. The decrease is due almost entirely to the noncash goodwill impairment. For the full year of 2022, net income decreased to a loss of $234.0 million or a loss of $94.43 per diluted share and $4.72 per ADS compared to a net income of $78.1 million or $33.91 per diluted share and $1.70 per ADS for the full year 2021. The decrease is due almost entirely to the noncash goodwill impairment and the Benson accrual.

我們錄得 2022 年第四季度淨虧損 1.944 億美元，即攤薄後每股虧損 78.47 美元和每股 ADS 虧損 3.92 美元，而 2021 年第四季度的淨收入為 1740 萬美元或攤薄後每股虧損 7.04 美元和每股 ADS 虧損 0.35 美元。減少幾乎完全是由於非現金商譽減值。 2022 年全年淨收入減少至虧損 2.34 億美元，或每股攤薄虧損 94.43 美元，每股 ADS 虧損 4.72 美元，而 2021 年全年淨收入為 7810 萬美元，或每股攤薄虧損 33.91 美元，每股 ADS 虧損 1.70 美元. 減少幾乎完全是由於非現金商譽減值和 Benson 應計費用。

Adjusted EBITDA for the fourth quarter of 2022 was $24.7 million compared to $25.8 million for the prior year quarter. Adjusted EBITDA margin was 32.4% for Q4 2022, representing an improvement from 29.9% in Q4 2021. The decrease in adjusted EBITDA was primarily due to lower revenue in the fourth quarter of 2022 with a higher adjusted EBITDA margin attributable to lower marketing expenditures. For the full year of 2022, adjusted EBITDA decreased to $101.6 million compared to 2021 at approximately $120.1 million. 2022 full year adjusted EBITDA margin was 31.6%, a reduction from 33.1% for full year 2021.

2022 年第四季度調整後的 EBITDA 為 2470 萬美元，上年同期為 2580 萬美元。 2022 年第四季度調整後的 EBITDA 利潤率為 32.4%，較 2021 年第四季度的 29.9% 有所改善。調整後的 EBITDA 下降的主要原因是 2022 年第四季度的收入減少，而調整後的 EBITDA 利潤率因營銷支出減少而增加。 2022 年全年，調整後的 EBITDA 與 2021 年相比下降至 1.016 億美元，約為 1.201 億美元。 2022 年全年調整後的 EBITDA 利潤率為 31.6%，低於 2021 年全年的 33.1%。

Adjusted EBITDA and adjusted EBITDA margin are non-GAAP measures, which we believe are useful in evaluating our operating performance, especially given the noncash impairment in goodwill that has affected traditionally used metrics for valuations like net income. A full reconciliation of these measures to the most directly comparable GAAP measure is available in the earnings release.

調整後的 EBITDA 和調整後的 EBITDA 利潤率是非 GAAP 指標，我們認為這有助於評估我們的經營業績，特別是考慮到商譽的非現金減值影響了傳統上使用的估值指標，如淨收入。收益發布中提供了這些措施與最直接可比的 GAAP 措施的全面調節。

Net cash flows used in operations were $20.8 million for the fourth quarter of 2022 compared to net cash flows generated from operations of $20.6 million in the prior year period. The change is entirely the result of the $50 million payment we made during the fourth quarter of 2022 towards the Benson settlement. Excluding this payment, we generated $29.1 million in net cash flows from operations in the quarter. You will notice that the loss contingency line item on our balance sheet associated with the Benson settlement had a corresponding decrease associated with this payment compared to that of the third quarter 2022.

2022 年第四季度運營產生的現金流量淨額為 2080 萬美元，而去年同期運營產生的現金流量淨額為 2060 萬美元。這一變化完全是我們在 2022 年第四季度為 Benson 和解支付了 5000 萬美元的結果。不包括這筆付款，我們在本季度的運營中產生了 2910 萬美元的淨現金流量。您會注意到，與 2022 年第三季度相比，我們資產負債表上與 Benson 和解相關的損失或有項目與這筆付款相關的損失相應減少。

For the full year, net cash flows from operations were $50.8 million compared to net cash flows from operations of $96.1 million for full year 2021. The year-over-year decrease is again due to the $50 million payment towards the Benson settlement. Excluding the $50 million payment towards the Benson settlement, net cash flows from operations in 2022 were $100.8 million. And we did not incur any material capital expenditures during the year.

全年，運營產生的現金流量淨額為 5080 萬美元，而 2021 年全年的運營現金流量淨額為 9610 萬美元。同比下降再次是由於支付了 5000 萬美元用於 Benson 和解協議。不包括支付給 Benson 和解金的 5000 萬美元，2022 年的運營現金流淨額為 1.008 億美元。年內我們沒有發生任何重大資本支出。

Finally, turning to our balance sheet. At the end of 2022, we had $285.2 million in cash, cash equivalents and short-term investments compared to $242.1 million at the end of 2021. The increase in our cash position was primarily due to net cash flows generated from operations during the year, partially offset by the payment made for the Benson settlement. Our total debt at the end of 2022 was $39.5 million.

最後，轉向我們的資產負債表。到 2022 年底，我們的現金、現金等價物和短期投資為 2.852 億美元，而 2021 年底為 2.421 億美元。我們現金頭寸的增加主要是由於年內運營產生的淨現金流量，部分被為 Benson 和解支付的款項所抵消。到 2022 年底，我們的總債務為 3950 萬美元。

That completes my financial summary. Now I will turn the call back over to IK for closing remarks.

這完成了我的財務摘要。現在我將把電話轉回給 IK 作結束語。

Thank you, Joe. Looking ahead, we are eagerly working towards a full global launch of Spinning in Space in the coming weeks as we execute on our strategy to provide compelling and innovative gaming options for our players. It is also important to remember that the development of our pipeline of new titles outside of the social casino segment and continued reinvestment into our flagship DoubleDown casino app to introduce new meta features and slot games are accomplished within our existing R&D budget during 2022.

謝謝你，喬。展望未來，我們正熱切地致力於在未來幾週內在全球範圍內全面推出太空旋轉，因為我們正在執行我們的戰略，為我們的玩家提供引人入勝的創新遊戲選擇。同樣重要的是要記住，我們在 2022 年的現有研發預算內完成了在社交賭場領域之外開發新遊戲的渠道，並繼續對我們的旗艦 DoubleDown 賭場應用程序進行再投資以引入新的元功能和老虎機遊戲。

We are also excited to close and integrate the SuprNation acquisition as we enter a new growth market and expand DoubleDown's reach. We see strong synergy opportunities between the 2 companies as we bring our leading online gaming experience and track record to the compelling games the SuprNation team has developed to establish a solid presence in their core markets. While this acquisition will provide us with new growth opportunities, we will continue to look for other M&A opportunities that can provide exposure to other growing gaming segments, diversify our business outside social casino and strengthen our overall company. We will continue to evaluate acquisition targets that have strong synergy potential, where we can leverage our existing technology platform and strength and experience in product development, marketing, user acquisition and live operations while maintaining an attractive financial model.

隨著我們進入一個新的增長市場並擴大 DoubleDown 的影響力，我們也很高興能夠完成並整合對 SuprNation 的收購。我們看到兩家公司之間強大的協同機會，因為我們將領先的在線遊戲體驗和業績記錄帶入 SuprNation 團隊開發的引人注目的遊戲，以在其核心市場建立穩固的地位。雖然此次收購將為我們提供新的增長機會，但我們將繼續尋找其他併購機會，以接觸其他不斷增長的遊戲領域，使我們的業務在社交賭場之外實現多元化，並加強我們的整體公司。我們將繼續評估具有強大協同潛力的收購目標，我們可以在這些目標中利用我們現有的技術平台以及在產品開發、營銷、用戶獲取和實時運營方面的實力和經驗，同時保持有吸引力的財務模式。

We ended 2022 in a strong financial position of over $150 million in cash, cash equivalents and short-term investments, net of debt and the accrual on our balance sheet associated with our Benson class action settlement. We believe DoubleDown continues to offer an attractive business model with a capital-light and flexible cost structure that is largely correlated to revenue or discretionary. We have high adjusted EBITDA margins, and we have tenured and dedicated customer base that provides healthy visibility into long-term recurring revenue. We are in a strong position to remain a leading gaming company that generates strong margins, positive cash flow and keeps low debt.

到 2022 年，我們的財務狀況良好，現金、現金等價物和短期投資超過 1.5 億美元，扣除債務和資產負債表上與 Benson 集體訴訟和解相關的應計費用。我們相信 DoubleDown 將繼續提供具有吸引力的商業模式，其資本輕型和靈活的成本結構在很大程度上與收入或可自由支配相關。我們的調整後 EBITDA 利潤率很高，我們擁有長期且專注的客戶群，可以為長期經常性收入提供健康的可見性。我們處於有利地位，可以繼續成為領先的博彩公司，產生高利潤率、正現金流並保持低債務。

We are now happy to take your questions. Operator?

我們現在很樂意回答您的問題。操作員？

(Operator Instructions) Our first question will come from the line of David Bain from B. Riley.

（操作員說明）我們的第一個問題將來自 B. Riley 的 David Bain。

Great. Very nice EBITDA and free cash flow results, [quarterly] navigation, as always. I guess my first question would be kind of a multipart question on one topic. But I'm really hoping you could expand the SuprNation strategy and impact -- the strategy, maybe touch on some of the content synergies from both the top line and cost perspective as an operator now and what specific expertise maybe you can bring in, in social to the real money wagering market to help customer acquisition and if one of those licensed markets or regulated markets, IK, that you mentioned would be the U.S.

偉大的。非常好的 EBITDA 和自由現金流結果，[季度] 導航，一如既往。我想我的第一個問題是關於一個主題的多部分問題。但我真的希望你能擴大 SuprNation 的戰略和影響——該戰略，也許現在作為運營商從收入和成本的角度觸及一些內容協同效應，以及你可以引入哪些具體的專業知識，在社交到真錢投注市場以幫助客戶獲取，如果您提到的那些許可市場或受監管市場之一 IK 將是美國

Yes, I'll start, and IK, as always, will chime in when I make a mistake. By the way, I hope you're having a good time at ICE. I would maybe start by saying that SuprNation has a really compelling business by themselves. And that was really actually very important to us. We're really excited about bringing the synergies and leverage the expertise and the capabilities that we have to make it even better. But I want to start by saying that their business right now in Western Europe and particularly their strength in Sweden and the U.K. is actually quite strong. Where we think we can leverage the benefits of DoubleDown towards them are -- well, there are several folds.

是的，我會開始，IK 會一如既往地在我犯錯時插話。順便說一下，我希望你在 ICE 過得愉快。我可能會首先說 SuprNation 本身就有一項非常引人注目的業務。這對我們來說真的非常重要。我們真的很高興能夠帶來協同效應，並利用我們擁有的專業知識和能力讓它變得更好。但我想首先說，他們現在在西歐的業務，尤其是他們在瑞典和英國的實力，其實是相當強大的。我們認為我們可以利用 DoubleDown 對他們的好處是——好吧，有幾個方面。

First, as you mentioned, content is king for slot-based apps, whether they be real money gaming or social casino. We have a very long history of choosing and developing our own slot games to really excite players. SuprNation has done that as well as they have partnered with several of the B2B players in i-Gaming content. We think that there's a great opportunity for us to take the several dozen games that we've developed ourselves and including games that we can source through DoubleU that we can also bring to bear in their business. And of course, if they're -- the games that we developed ourselves, there is a significant benefit from a reduction in -- cost of revenue reduction or elimination of royalties, specifically for those games. So we're excited to start working with them as soon as possible, which is when this deal closes, to look into that further.

首先，正如您提到的，對於基於老虎機的應用程序而言，內容為王，無論是真錢遊戲還是社交賭場。我們在選擇和開發自己的老虎機遊戲以真正激發玩家興趣方面有著悠久的歷史。 SuprNation 已經做到了這一點，並且他們在 i-Gaming 內容方面與幾家 B2B 玩家合作。我們認為這是一個很好的機會，可以利用我們自己開發的幾十款遊戲，包括我們可以通過 DoubleU 採購的遊戲，我們也可以將它們用於他們的業務。當然，如果它們是——我們自己開發的遊戲，那麼減少收入或取消版稅的成本會帶來顯著的好處，特別是對於那些遊戲。因此，我們很高興盡快開始與他們合作，也就是交易結束時，以進一步調查。

Relative to technology, they have a very thin engineering team, as you might expect for a company of their size. And we have very capable, very experienced engineers, especially back office and server side engineers that we can bring to bear and we think quite quickly into the equation for them. And we're looking forward to determining exactly where and how we can do that as we get closer to closing the deal.

相對於技術，他們的工程團隊非常薄弱，正如您對他們規模的公司所期望的那樣。我們擁有非常有能力、非常有經驗的工程師，尤其是我們可以承擔的後台和服務器端工程師，我們很快就會為他們考慮到方程式。我們期待著在接近完成交易時確定我們可以在哪里以及如何做到這一點。

And then finally, from a marketing standpoint, not unlike our business, marketing is the #1 cost of i-Gaming, just like social casino. And we have a lot of experience there, and we are really excited about, especially having experience on the performance marketing side, our ability to have them benefit from what we know and what we can bring on that side.

最後，從營銷的角度來看，與我們的業務不同，營銷是 i-Gaming 的第一大成本，就像社交賭場一樣。我們在那裡有很多經驗，我們真的很興奮，尤其是在績效營銷方面有經驗，我們有能力讓他們從我們所知道的和我們可以帶來的東西中受益。

Awesome. And I'm sorry, just as part of that question, just on the U.S. eventually perhaps. And I assume the focus will also sort of continue to be on EBITDA with that acquisition relative to kind of what we've seen in the U.S. I mean I know it's a more mature market that you're entering, but -- which is great from that perspective. I just wanted to confirm that. And then if I could, I just had one follow-up.

驚人的。很抱歉，作為這個問題的一部分，也許最終只針對美國。而且我認為相對於我們在美國看到的那種收購，重點也將繼續放在 EBITDA 上。我的意思是我知道你正在進入一個更成熟的市場，但是 - 這很棒從那個角度來看。我只是想確認一下。然後，如果可以的話，我只進行了一次跟進。

Sure. Well, I'd say that before we -- I mean the U.S. is obviously something that's out there. But before we really would even consider the entry into the U.S., there are opportunities in other jurisdictions in Western Europe and other parts of the world that would be potentially, I guess, lower-hanging fruit or maybe specifically less costly than entering the U.S. market. Who knows what will happen down the road? But to your point, I mean, we're always focused on growing revenue with an eye on profitability and our EBITDA and EBITDA margin, and that doesn't necessarily match with quick entry into the U.S. But there are other opportunities within Europe, and as I said, other parts of the world, and by the way, including growing their market share just in Sweden and U.K., where they've done very well, but they're still a small player relative to some of the big i-Gaming providers.

當然。好吧，我會在我們之前說 - 我的意思是美國顯然是在那裡的東西。但在我們真正考慮進入美國之前，西歐和世界其他地區的其他司法管轄區也有機會，我想，這些機會可能比進入美國市場更容易實現，或者成本可能更低.誰知道接下來會發生什麼？但就你的觀點而言，我的意思是，我們始終專注於增加收入，同時關注盈利能力以及我們的 EBITDA 和 EBITDA 利潤率，這不一定與快速進入美國相匹配。但在歐洲還有其他機會，而且正如我所說，世界其他地區，順便說一句，包括在瑞典和英國增加他們的市場份額，他們在那裡做得很好，但相對於一些大的 i-遊戲供應商。

Awesome. Okay. And then the last one, I'm sorry. The extraordinary general meeting that you held during the fourth quarter to reclassify, I believe it's $260 million on your balance sheet. What does that structurally allow for? Or what does that change? And I asked this in relation to how we're viewing capital return optionality to shareholders at this point in terms of either buybacks or dividends.

驚人的。好的。然後是最後一個，對不起。你在第四季度舉行的臨時股東大會重新分類，我相信你的資產負債表上有 2.6 億美元。這在結構上允許什麼？或者這會改變什麼？我問這個問題是關於我們在回購或股息方面如何看待股東的資本回報選擇權。

Sure. Yes. Thanks, Dave. So per Korean law, the ability for a Korean company, which, of course, we are, to provide a return to shareholders, whether it be dividend or stock buyback, is calculated on ensuring there's enough retained earnings based on, and this is the important part, the stand-alone Korean-only balance sheet. And so when we had it last year and looked into this and have got the experts involved, the calculation of the Korean-only balance sheet was determined to not have, well, frankly enough, retained earnings for us to have any flexibility on shareholder returns if the Board chose to do that. And that's why we made that reclassification.

當然。是的。謝謝，戴夫。因此，根據韓國法律，韓國公司（當然，我們是）向股東提供回報（無論是股息還是股票回購）的能力是根據確保有足夠的留存收益來計算的，這就是重要的部分，只有韓國的獨立資產負債表。因此，當我們去年進行調查並請專家參與時，我們確定僅韓國資產負債表的計算沒有留存收益，坦率地說，我們在股東回報方面沒有任何靈活性如果董事會選擇這樣做。這就是我們進行重新分類的原因。

Our next question will come from the line of Aaron Lee from Macquarie.

我們的下一個問題將來自 Macquarie 的 Aaron Lee。

As you noted, your margins expanded to over 32% in the quarter, which I think is a good example of the flexibility in your business. How should we think about margins in 2023, just thinking about any growth investments, [UA] support for new launches and the SuprNation integration? Can you maintain margins in the 30%-plus level you've been running at for the last few years?

正如您所指出的，本季度您的利潤率擴大到 32% 以上，我認為這是您業務靈活性的一個很好的例子。我們應該如何考慮 2023 年的利潤率，只考慮任何增長投資、[UA] 對新發布的支持和 SuprNation 集成？您能否將利潤率保持在過去幾年一直保持的 30% 以上水平？

Thanks, Aaron. Nice to talk to you. There's a number of factors that we look at as we balance the desire, as I mentioned earlier, to maintain our profitability with the desire, of course, to grow. And we also recognize that, as I mentioned also earlier, the biggest cost to a social casino company -- to a gaming company is the sales and marketing -- is the acquisition of new users. And so as we launch new apps, we will obviously be investing in those apps. And so I would expect that we will spend somewhat more in sales and marketing in the fact that we would be investing in those new apps. However, two things that I think you can balance relative to that comment.

謝謝，亞倫。很高興和你聊天。正如我之前提到的，在保持盈利能力與增長的願望之間取得平衡時，我們會考慮許多因素。我們還認識到，正如我之前提到的，社交賭場公司的最大成本——對遊戲公司來說是銷售和營銷——是獲取新用戶。因此，當我們推出新的應用程序時，我們顯然會投資於這些應用程序。因此，我預計我們會在銷售和營銷方面投入更多，因為我們會投資於這些新應用程序。但是，我認為您可以根據該評論平衡兩件事。

The first is that we believe we can even be more efficient in how we invest in sales and marketing for DoubleDown Casino. So we believe we have an opportunity, especially as we continue to look at our ROAS and look at our various channels that are used to acquire new users that we can be more efficient on the DDC -- on the DoubleDown Casino side to help offset, if you will, what we will be investing in new apps.

首先，我們相信我們甚至可以更有效地投資 DoubleDown Casino 的銷售和營銷。所以我們相信我們有機會，特別是當我們繼續關注我們的 ROAS 並關注我們用於獲取新用戶的各種渠道時，我們可以在 DDC 上更有效率——在 DoubleDown Casino 方面幫助抵消，如果你願意，我們將投資於新的應用程序。

And secondly, I will say that we learned from the launch of Undead World and that we believe that we can be more strategic and more efficient in how we -- even at the outset of launching a new app, how we can invest to get new users in a way that doesn't overly impact our profitability even -- as I said, even at the beginning of the launch. So I think from a sales and marketing standpoint, we're very focused on efficiency, effectiveness and managing ROAS. And that, I think, will allow us to continue to deliver the EBITDA margins that people expect from us.

其次，我要說的是，我們從 Undead World 的發布中吸取了教訓，我們相信我們可以更具戰略性和更高效地——即使是在發布新應用程序的開始，我們如何投資以獲得新的應用程序。用戶以一種不會過度影響我們的盈利能力的方式——正如我所說，即使在發布之初。所以我認為從銷售和營銷的角度來看，我們非常關注效率、有效性和管理 ROAS。我認為，這將使我們能夠繼續提供人們對我們期望的 EBITDA 利潤率。

Great. And that's helpful. And I know you guys aren't giving guidance, but any high-level thoughts just in terms of the market competition and growth in the year ahead? And should we expect to see a continuation of some of the trends we've seen over the past few years of declining DAUs but growing ARPDAU? Or could we possibly see some user growth as well?

偉大的。這很有幫助。而且我知道你們沒有給出指導，但是就未來一年的市場競爭和增長而言，有什麼高層次的想法嗎？我們是否應該期望看到我們在過去幾年中看到的一些趨勢的延續，即 DAU 下降但 ARPDAU 增長？或者我們是否也可能看到一些用戶增長？

Sure. Well, I think there certainly has not been a lot of change in the last several quarters as far as the competitive landscape. And the social casino market, as we all know, has been maturing over the last several quarters, even in the post-COVID period. So we expect to continue to do very, very well in managing our very sticky user base and maintaining our players as players, but as always, most importantly, maintaining our payers as payers and continuing to, if at all possible, grow monthly average revenue per payer, which we've been really fortunate to be able to do over the last several quarters. And so we will, first and foremost, can -- focus on taking care of our existing payers and through our user acquisition activity, acquiring new players, but most importantly, new payers.

當然。好吧，我認為就競爭格局而言，過去幾個季度肯定沒有太大變化。眾所周知，社交賭場市場在過去幾個季度一直在成熟，即使是在後 COVID 時期也是如此。因此，我們希望在管理我們非常粘性的用戶群和維護我們的玩家作為玩家方面繼續做得非常非常好，但一如既往，最重要的是，將我們的付款人維持為付款人，並在可能的情況下繼續增加月平均收入每個付款人，我們真的很幸運能夠在過去幾個季度做到這一點。因此，我們將首先能夠——專注於照顧我們現有的付款人，並通過我們的用戶獲取活動，獲取新的玩家，但最重要的是，新的付款人。

Got you. Perfect. And congrats on the quarter and congrats on SuprNation.

明白了完美的。祝賀這個季度，祝賀 SuprNation。

(Operator Instructions) Our next question comes from the line of Greg Gibas from Northland Capital.

（操作員說明）我們的下一個問題來自 Northland Capital 的 Greg Gibas。

I was wondering if you could maybe rank and discuss the European markets where SuprNation operates right now and maybe where you see the greatest opportunities for growth there, whether it's further penetrating existing markets or entering new ones.

我想知道你是否可以對 SuprNation 目前運營的歐洲市場進行排名和討論，以及你在哪裡看到最大的增長機會，無論是進一步滲透現有市場還是進入新市場。

Sure, Greg. Thanks. It's good to talk to you. So as I mentioned, right now, Sweden and Great Britain are their largest markets. And they, as IK mentioned, hold licenses elsewhere. As far as growth, still within Western Europe in addition to Sweden and Great Britain, I mean, there are some large markets. And each of these markets -- this is not like social casino where you launch an app and you're in 200-plus countries because of the app stores the next day. It's definitely by jurisdiction, by the laws and the policies associated with those jurisdictions.

當然，格雷格。謝謝。很高興和你交談。所以正如我提到的，現在，瑞典和英國是他們最大的市場。正如 IK 提到的，他們在其他地方持有許可證。就增長而言，除了瑞典和英國之外，仍然在西歐，我的意思是，還有一些大市場。而且這些市場中的每一個——這不像社交賭場，在那裡你發布一個應用程序，因為第二天就有應用程序商店，你就會在 200 多個國家/地區。這絕對是按司法管轄區、與這些司法管轄區相關的法律和政策確定的。

So we're still very excited. They are still very excited about growth in those 2 main markets that they have. And if you look at larger markets that are potentially enterable within a reasonable period of time in Western Europe, I mean, Italy is a large market. There are other markets that we could enter. I don't want to make a prediction or get too far into what's next discussion because we do need to focus them on what they're doing right now, first and foremost, work on the synergies that we believe they could benefit from. And then in the course of those discussions, we certainly will talk about new markets and new jurisdictions.

所以我們仍然非常興奮。他們仍然對他們擁有的這兩個主要市場的增長感到非常興奮。如果你看看西歐在合理時間內可能進入的更大市場，我的意思是，意大利是一個大市場。我們還可以進入其他市場。我不想做出預測或深入討論下一次討論的內容，因為我們確實需要讓他們專注於他們現在正在做的事情，首先是致力於我們認為他們可以從中受益的協同作用。然後在這些討論過程中，我們當然會談論新市場和新司法管轄區。

Got it. Very helpful. And if I could maybe just follow-up on expectations outside of the core social casino or what it means to the model. I think you said it was $18 million or so in revenue for SuprNation in the first 9 months of '22. Is that a good run rate to use going forward? And then second, on Spinning in Space, I think IK said release time frame, upcoming weeks here. What are maybe your financial expectations of that game?

知道了。很有幫助。如果我可以跟進核心社交賭場之外的期望或它對模型的意義。我想你說過 SuprNation 在 22 年前 9 個月的收入約為 1800 萬美元。這是一個很好的運行率嗎？其次，關於 Spinning in Space，我想 IK 說的是發佈時間框架，即將到來的幾週。您對該遊戲的財務期望是什麼？

Yes. Well, as far as the run rate, I think you can annualize the run rate, and that's probably a good estimation at this point. I will say that as it relates to close of the deal, we're still -- it's a process. As you know, regulators where they hold licenses today need to approve the deal. So it's -- it's not a quick close. We're expecting a Q2 close, but it would certainly be towards -- right now, we're thinking towards the end of Q2, so -- for your model, let's say.

是的。好吧，就運行率而言，我認為你可以將運行率年化，這在這一點上可能是一個很好的估計。我會說，因為它與交易的結束有關，我們仍然 - 這是一個過程。如您所知，目前持有牌照的監管機構需要批准這筆交易。所以它 - 這不是一個快速關閉。我們期待第二季度結束，但它肯定會接近 - 現在，我們正在考慮第二季度末，所以 - 對於你的模型，比方說。

As it relates to growth in other areas, I mean, I think that the Spinning in Space soft launch just happened early last week based on a successful open beta period in January. And it's early days, but we like what we see relative to the app, and there's definitely interest in this kind of app. It's kind of hybrid, social casino/journey progression, achievements-type app. And so we're excited about seeing how it grows. And then as IK mentioned, we do have other apps that we -- nothing that we'll discuss -- be able to discuss today, but we do have other apps that are teed up for launch in 2023.

由於它與其他領域的增長有關，我的意思是，我認為 Spinning in Space 軟啟動剛剛在上週早些時候發生，基於 1 月份的成功公開測試期。現在還處於早期階段，但我們喜歡我們所看到的與該應用程序相關的內容，並且肯定會對這種應用程序感興趣。它是一種混合型、社交賭場/旅程進程、成就型應用程序。所以我們很高興看到它是如何成長的。然後正如 IK 提到的，我們確實有其他應用程序——我們不會討論——今天可以討論，但我們確實有其他應用程序準備在 2023 年推出。

Thank you. And at this time, this concludes our question-and-answer session. I'd now like to turn the call back over to Mr. Sigrist.

謝謝。至此，我們的問答環節到此結束。我現在想把電話轉回給 Sigrist 先生。

Victor, thanks very much, and thank you for joining our call today and your interest in DoubleDown. We look forward to sharing our future updates as we continue to innovate and grow within the global digital gaming industry, and have a great rest of your day.

Victor，非常感謝，感謝您今天加入我們的電話會議以及您對 DoubleDown 的興趣。隨著我們在全球數字遊戲行業不斷創新和發展，我們期待著分享我們未來的更新，並祝您度過愉快的一天。

Thank you for joining us today for DoubleDown's earnings call. You may now disconnect.

感謝您今天加入我們參加 DoubleDown 的財報電話會議。您現在可以斷開連接。