Group 1 - Enthusiast Gaming Holdings Inc. has successfully closed a debt financing transaction, receiving a non-revolving term loan of $2,000,000 [1] - The transaction was arranged under a forbearance and first supplemental credit agreement involving the Company, its subsidiaries, Beedie Investments Ltd. as the administrative and collateral agent, and lenders led by Beedie Capital [1] - The agreement was finalized on July 10, 2025, with further details available in the Company's press release dated the same day [1] Group 2 - Enthusiast Gaming operates a portfolio of digital properties that are well-known in the gaming industry, including U.GG, Icy-Veins, TheSimsResource, and others [2] - The Company generates revenue through programmatic advertising, subscriptions, and events, while focusing on expanding its owned intellectual property and enhancing direct engagement with its audience [2]

Core Points - Enthusiast Gaming Holdings Inc. has announced a debt financing and forbearance transaction aimed at supporting its recapitalization and long-term business objectives [1] - The company is focusing on its high-performing digital gaming media assets following the divestment of its direct sales business line [1][2] - A strategic review process has been initiated to explore opportunities for strengthening the balance sheet and unlocking shareholder value [2] Debt Financing and Forbearance Agreements - The transaction includes a non-revolving term loan of $2,000,000, which will be used for working capital purposes [5] - The company has entered into forbearance agreements with its lenders, allowing them to forbear from demanding repayment of outstanding debts [6][7] - A cost-cutting plan is to be implemented to achieve annualized cost savings of at least $3,000,000 [8] Terms of the Term Loan and Warrant Issuance - The term loan carries a fixed interest rate of 16.0% per annum, with specific conditions for interest payments [9] - The company plans to issue 6,005,178 warrants to lenders, with an exercise price set at $0.083, a 15% premium over the average price of common shares [11] - The term loan is due by July 12, 2028, and can be prepaid without penalty before March 31, 2026 [9][10] Strategic Review and Special Committee - A Special Committee has been formed to oversee the strategic review process and evaluate potential alternatives [3][4] - Oakvale Capital Partners LLP has been engaged as the financial advisor for the strategic review [4] - The goal is to enter into a definitive agreement for a strategic transaction by the end of 2025 [4]

Leadership Changes - Alex Macdonald has been appointed as Chief Executive Officer, effective July 6, 2025, succeeding Adrian Montgomery [1][2] - J.B. Elliott has been appointed as President and Chief Operating Officer, previously serving as Chief Strategy Officer and General Counsel [3] - Nathan Teal has been appointed as Interim Chief Financial Officer, bringing over 20 years of experience in public accounting and financial reporting [4] Business Strategy and Divestment - The company has signed a letter of intent (LOI) with an entity controlled by Adrian Montgomery for the divestment of its direct sales business line and related creative assets [5] - The direct sales business includes Omnia Media Inc. and GameCo Esports Canada Inc., which hold the company's YouTube CSP licenses and esports operations, respectively [5] - Following the transaction, the company will retain its owned and operated content channels, ensuring continuity in operations [6] Financial Implications - The proposed transaction includes a purchase price of US$1,000,000, with the purchaser assuming certain liabilities related to the acquired entities [7][8] - The transaction is expected to result in approximately $10 million of annual cost savings, leading to material improvements in Adjusted EBITDA and significant working capital benefits [11] Future Business Focus - Post-transaction, the company will continue to operate its portfolio of owned and operated digital assets, including major gaming properties and events [12] - The company aims to deepen direct engagement with its audience and expand its owned intellectual property, focusing on monetizing more effectively [13][14]

Company Overview - Enthusiast Gaming Holdings Inc. is a leading gaming and media company in North America, focusing on connecting video game enthusiasts and esports fans globally [3] - The company operates through five core pillars: creators, content, communities, games, and experiences, providing unique marketing opportunities to engage Gen Z and Millennial audiences [3] Annual General Meeting - The annual general meeting of Enthusiast Gaming is scheduled to be held virtually on September 16, 2025 [1] - The Toronto Stock Exchange has granted an extension for the company to hold its annual general meeting by this date [2] - Meeting materials will be available on the company's profile on SEDAR+ and its website around August 15, 2025 [2]

Barcelona debut event draws over 1,000 attendees, global interest from gaming leaders including Epic Games, King, Ubisoft, Xbox, Scopely, and RovioLOS ANGELES, June 17, 2025 (GLOBE NEWSWIRE) -- Enthusiast Gaming Holdings Inc. (“Enthusiast Gaming'' or the “Company”) (TSX: EGLX), a leading gaming and media company, today announced the successful launch of Pocket Gamer Connects Barcelona, the latest expansion of its flagship B2B gaming conference series. The event was immediately profitable, attracting over 1, ...

Core Insights - Enthusiast Gaming has announced a strategic partnership with Mediacube, enhancing its media inventory and access to a larger network of YouTube creators [1][2] - The partnership aims to provide brands with expanded access to Gen Z and Millennial audiences through premium advertising opportunities [2][4] - Mediacube selected Enthusiast Gaming for its proven ability to help brands authentically engage in the gaming space, creating new monetization paths for creators [3] Company Overview - Enthusiast Gaming is a leading gaming media and entertainment company in North America, focusing on connecting video game enthusiasts and esports fans [5][6] - The company operates on five core pillars: creators, content, communities, games, and experiences, offering integrated brand solutions for marketers [5][6] - Enthusiast Gaming continues to grow its network, reflecting the diversity and scale of gaming enthusiasts today [5][6]

Core Insights - Enthusiast Gaming Holdings Inc. reported a significant decline in revenue for Q1 2025, totaling $12.2 million, down 48% from $23.3 million in Q1 2024, primarily due to the strategic deprioritization of low-margin video platform revenue [5][7] - The company has focused on rebuilding its structure to enhance efficiency, resulting in gross margins stabilizing above 70% and a reduction in cash-based operating expenses [2][5] - Despite the revenue decline, the company is seeing growth in its programmatic business, paid subscriptions, and event revenue, positioning itself for future scalability [2][5] Financial Highlights - Revenue for Q1 2025 was $12.2 million, a 48% decrease from $23.3 million in Q1 2024 [5][7] - Gross profit was $9.0 million, down 36% from $14.1 million in Q1 2024, with gross margin increasing to 74.3% from 60.3% [5][8] - Operating expenses decreased to $14.1 million from $15.5 million in Q1 2024, reflecting strategic initiatives for efficiency [5][8] - Adjusted EBITDA loss was $2.6 million, compared to a loss of $1.8 million in Q1 2024 [8][24] - Net loss for Q1 2025 was $6.1 million, or $(0.04) per share, compared to a net loss of $1.3 million, or $(0.01) per share, in Q1 2024 [8][19] Business Highlights - Icy Veins showed strong performance, with yield improving by over 100% year-over-year, driven by strategic ad tech optimizations and new title coverage [5][6] - The Sims Resource grew its paid subscriber base, focusing on premium annual subscriptions for better retention [5][6] - U.GG experienced significant engagement growth, particularly in League of Legends, while expanding into new titles [5][6] - PocketGamer.com doubled its audience in Q1 2025, achieving over 30 million page views [9] - The direct sales team reported growth, closing $2.4 million in sales in Q1 2025, up from $2.1 million in Q4 2024 [9] - Enthusiast Gaming hosted two major PocketGamer Connects events, with significant year-over-year growth in attendance and sponsorship [9] Strategic Initiatives - The company has strategically deprioritized low-margin video platform revenue, which accounted for a significant portion of the revenue decline [5][7] - Focus has shifted towards high-margin products and properties, enhancing the ability to convert audience engagement into financial performance [2][5] - The company plans to continue its disciplined approach while preparing for stronger seasonal trends expected in the second half of the year [2][5]

Core Insights - Enthusiast Gaming integrates U.GG and Luminosity into the Rainbow Six Siege ecosystem, enhancing its relationship with Ubisoft ahead of the Siege X release [1][2] - The upcoming Siege X platform update aims to redefine the game's ecosystem and attract a larger player base by introducing free-to-play access to popular game modes [2] - U.GG's platform now provides essential tools for Rainbow Six Siege players, including global leaderboards and detailed player profiles, aligning with the game's revitalization [2][4] - Luminosity Gaming continues to compete in the Rainbow Six North American Pro League, representing a strategic investment in the game's competitive landscape [3][4] - Enthusiast Gaming's strategy focuses on partnering with publishers to build stronger gaming communities through data, content, and competitive infrastructure [4] Company Overview - Enthusiast Gaming is a leading gaming media and entertainment company in North America, connecting video game enthusiasts and esports fans globally [5] - The company operates on five core pillars: creators, content, communities, games, and experiences, providing unique marketing opportunities to engage Gen Z and Millennial audiences [5]

Financial Data and Key Metrics Changes - In Q4 2024, adjusted EBITDA improved significantly to $1.9 million from a loss of $3 million in Q4 2023, marking a $4.9 million swing into profitability [11][45] - Revenue for Q4 2024 was reported at $17.8 million, down from $47.1 million in Q4 2023, but gross margin improved to 76% from 40% in the same period [11][43] - For the full year 2024, total revenue was $73 million, down from $178 million in 2023, primarily due to the deprioritization of low-margin network revenues [12][39] Business Line Data and Key Metrics Changes - Media and content revenue in Q4 2024 was $12.8 million, down from $42.6 million in Q4 2023, mainly due to the deprioritization of the low-margin Omnia video network [40] - Esports and entertainment revenue increased to $2 million in Q4 2024 from $1.2 million in Q4 2023, driven by increased event revenue [40] - Subscription revenue decreased to $2.9 million in Q4 2024 from $3.3 million in Q4 2023, primarily due to the sale of certain legacy casual gaming assets [41] Market Data and Key Metrics Changes - The company ended 2024 with $4.8 million in cash and positive working capital of approximately $3.3 million, indicating improved financial health [46] - The partnership with Playwire has led to higher yields and improved monetization across owned and operated properties, contributing to the overall financial performance [37][50] Company Strategy and Development Direction - The company has refocused its business to emphasize owned and operated assets, eliminating lower-margin segments to improve profitability [9][10] - The strategic goal for 2025 is to expand the audience by engaging more gamers through product development and content strategies [15][56] - The company plans to invest in custom content and flexible models that align better with customer needs, moving away from rigid sponsorship commitments [26][76] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining high gross margins similar to those achieved in 2024, with a focus on cost discipline and efficient monetization [14][48] - The broader economic environment is being monitored, with expectations of strong digital advertising growth in 2025, despite some caution regarding potential tariff impacts [52][53] - The company is optimistic about the future, emphasizing a commitment to profitable revenue growth while protecting margins [54][55] Other Important Information - The company has made significant reductions in operating expenses, with cash-based quarterly operating expenses down by over $10 million year-over-year in Q4 2024 [12][44] - The NFL Tuesday Night Gaming program has been discontinued due to unfavorable economics, allowing for a more flexible and profitable approach to custom content [25][76] Q&A Session Summary Question: Can you provide insights on top-line expectations and EBITDA performance for Q1? - Management noted that while Q1 typically sees normal seasonality, there is optimism for firmer CPMs and potential for positive EBITDA despite the end of the NFL TNG contract [59][60][68] Question: What is the outlook for gross margins in 2025? - Management indicated that gross margins are expected to stabilize in the low 70% range, with potential dips in Q1 followed by improvements throughout the year [69][70] Question: Are there future opportunities with the NFL? - Management stated that while the NFL relationship has concluded for now, there could be future opportunities, but the focus will be on more scalable and flexible content models [73][76] Question: Can you provide details on the contribution from political advertising? - Management confirmed that political advertising contributed approximately $1 million in Q4, with ongoing opportunities in the current political cycle [90][91] Question: What metrics can you share regarding the Playwire partnership? - Management highlighted improvements in CPMs, fill rates, and overall yield due to the partnership with Playwire, which has also led to cost savings [92][96]

Revenue and Growth - Annual revenue reached $202.8 million, representing a 21% increase year-over-year from $167.4 million in 2021[6] - Revenue for the year ended December 31, 2022, increased to $202.84 million, up 21.2% from $167.36 million in 2021[22] - Direct sales amounted to $37.4 million, up 69% from $22.2 million in 2021[6] - Subscription revenue reached $14.5 million, a 54% increase from $9.4 million in 2021, with paid subscribers growing to 262,000, up 19% from 220,000 in 2021[6] Profitability - Gross profit was $63.5 million, a 68% increase from $37.8 million in 2021, with a gross margin of 31.3%, up 870 basis points year-over-year[6][3] - Gross profit for Q4 2022 was $18.1 million, a 32% increase from $13.7 million in Q4 2021, with a gross margin of 33.5%, up 940 basis points year-over-year[17] - Gross margin improved to $63.46 million, representing a gross margin percentage of 31.3%, compared to 22.6% in the previous year[22] Expenses and Losses - Operating expenses rose to $110.80 million, an increase of 29.9% from $85.32 million in 2021[22] - Net loss for the year was $76.83 million, compared to a net loss of $52.05 million in 2021, reflecting a 47.5% increase in losses[22] - The company reported a net cash used in operating activities of $26.64 million, compared to $23.68 million in the previous year[23] Assets and Liabilities - Total current assets decreased to $47.84 million from $59.27 million, a decline of 19.3% year-over-year[21] - Total liabilities reduced significantly to $86.79 million, down 30.7% from $125.01 million in 2021[21] - Shareholders' equity decreased to $254.65 million from $262.77 million, a decline of 3.1% year-over-year[21] - Cash and cash equivalents at year-end decreased to $7.42 million from $22.65 million, a decline of 67.2%[23] Strategic Initiatives - The company launched an in-house talent agency, Storied, to enhance content initiatives and access top talent[17] - The NFL Tuesday Night Gaming collaboration generated approximately 48 million impressions in 2022, with 19 episodes produced[6] - The company achieved record attendance at live events under the Pocket Gamer Connects series in 2022, expanding into new locations[7] Financing - The company secured a $10 million expansion of its credit facility, increasing the total to $20 million, with maturity extended to December 31, 2024[6] Challenges - Goodwill impairment recorded was $31.28 million, indicating significant challenges in asset valuation[22] - Revenue for Q4 2022 was $54.0 million, a decrease of 5% compared to Q4 2021, primarily due to lower CPMs in the digital advertising industry[17]