Playtika Holding Corp. Q1 FY2025 earnings call

• Playtika achieved a historic milestone in Q1 with over $700 million in revenue, the highest quarterly revenue in its history.
• Disney Solitaire launched on April 17 and is showing promising early performance.
• Bingo Blitz had a record quarter with initiatives like the American Idol campaign and a game show on the Game Show Network.
• Slotomania faced revenue decline due to resurfacing game economy issues, with plans to launch a new slot game in the back half of the year and integrate IGT slot titles.
• The company is investing in performance marketing, with D2C efforts showing strong results, and focusing on stabilizing underperforming segments while leveraging leading casual game franchises.

In the first quarter, Playtika generated $706 million in revenue. Bingo Blitz had record revenues with $162.4 million, up 2.1% sequentially and 3.1% year-over-year. Slotomania had revenue of $111.8 million, down 5.5% sequentially and 17.4% year-over-year. Dice Dreams saw revenue of $78.6 million, up 124.5% sequentially. Domino Dreams is performing in line with expectations and ramping up revenue. Disney Solitaire had a global launch on April 17 and is showing a promising start. The direct-to-consumer business achieved record revenues of $179.2 million, up 2.6% sequentially and 4.5% year-over-year, driven by Bingo Blitz, June's Journey, and Solitaire Grand Harvest, offsetting declines from slot titles.

• Reaffirmed full-year guidance, with declining trends in slot games offset by growth in casual titles.
• Marketing expenses are expected to decline sequentially through the year.
• Confident Disney Solitaire will reach the hundred million dollars run rate revenues mark faster than previous titles like Dice Dreams and Domino Dreams.

• Resurfacing game economy issues in Slotomania leading to continued revenue declines in the coming quarter.
• Evolving mobile gaming landscape where revenue is concentrated on established titles, which may impact underperforming segments.
• Dependence on key franchises and potential challenges in stabilizing and growing underperforming slot titles.

Q: Talk a little bit more about Disney Solitaire and how that fits into your marketing plans for the year, balancing against commentary that marketing expenses will be declining sequentially A: Hey Doug, thank you for 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. So, we're mindful kind of allocating capital towards those games with the best ROI.

Q: On Slotomania, expecting continued declines, how to think about the path forward; plan to stabilize or new slot game as replacement A: Thanks for the question. So, we see issues around Slotomania in the last year, and we will show that last quarter we found a way to stabilize the game. I think in the end of the day; 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. On the other hand, our last launch of a slot game was 10 years ago, and in the last 10 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.

Q: On the D2C front, update on timing and D2C mix development, changes to D2C adoption rate expectations A: So, thanks for the question. D2C for Playtika 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 see -- we see the changes in the market. We still learning the changes. We still try to understand how to react. But one thing I can say, we are all in. We understand, we are ready, we are going. For us, it's one of the most biggest potential for a more profit to the company, more EBITDA to the company. And again, for everyone speaking about the PC for us is old news. We are starting in a different place than everyone else. And I think again, for Playtika, this is a huge opportunity. And actually, it's really hard to say opportunity because it's already here.