Financial PerformanceThe company reported 2H24 revenue of $45.9M, which was below the estimate of $49.0M, and a gross margin of 1.4%, lower than the expected 4.7% due to decreased higher-margin sponsorship, advertising, and IP licensing revenue from the esports team segment.
Industry ChallengesDue to softness in the esports/gaming industry, forward growth estimates are tempered, with a lower 1H25E revenue forecast.
Revenue GrowthDespite expansion efforts, the company faces challenges as its talent management segment has historically negative gross margins, although recent strategy shifts aim to improve this by 2025.