Financial Data and Key Metrics Changes - Second quarter revenue was $59 million, down approximately 18.3% year over year and 5.4% sequentially, reflecting continued softness in core casino and casual games [15] - Adjusted EBITDA for the quarter was $10.7 million, down 24% year over year and 14.2% sequentially, indicating limited flow through due to revenue softness [15] - DAU was 2.3 million, down from 2.6 million in the first quarter and 3.2 million in the previous year [16] - MAU was 10 million, down from 11.4 million in the first quarter [16] - ARPDAU was $0.28, up slightly from $0.26 last quarter and $0.25 a year ago, reflecting stronger monetization [16] Business Line Data and Key Metrics Changes - The core social casino portfolio continued to soften, with ongoing declines in DAU across most titles, partially offset by stronger unit level monetization in Mykonami [10] - Direct to consumer revenue for Q2 was $6.7 million, representing 13.9% of total in-app purchase revenue, up 107% year over year and 34% sequentially [10][17] - The casual portfolio remains under pressure due to challenging market dynamics, with a focus on product updates to improve engagement and retention [11] Market Data and Key Metrics Changes - The market is experiencing a rapid rise in social casinos leveraging sweepstakes mechanics, reshaping player behavior and monetization [4] - The company is seeing clear evidence that its sweepstakes proposition resonates with players, with player retention, engagement, and monetization trending positively [6] Company Strategy and Development Direction - The company launched a reinvention program last year to adapt to market changes, focusing on developing sweepstakes capabilities, expanding direct to consumer sales, and modernizing core games [5][18] - A phased approach is being taken to scale the sweepstakes initiative, with plans to be live across all eligible U.S. states later this year [7] - The company is exploring strategic acquisitions to accelerate momentum and position itself for market leadership in the sweepstakes category [8][40] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges in the core business but remains confident in the strategic steps being taken to adapt and evolve [18] - The company is not changing its full-year revenue and adjusted EBITDA guidance despite pacing below expectations, as it continues to evaluate investments and market dynamics [17] Other Important Information - The balance sheet remains strong, with approximately $112.9 million in cash and no debt, providing strategic latitude for capital deployment [13] - The company is committed to building a stronger, more diversified foundation to drive renewed momentum in the future [18] Q&A Session Summary Question: Can you split DAU and MAU declines between social casino and casual games? - Management indicated that declines were substantial in both categories, with more dramatic impacts in the casual space due to reduced user acquisition investments [24] Question: Any quantitative KPIs on sweepstakes performance? - Management reported positive improvements across key metrics such as retention and conversion rates, feeling optimistic about the progress made [27] Question: Guidance for Q3 expectations? - Management stated that Q3 is not expected to differ significantly from Q2, focusing on executing initiatives to restore momentum [31] Question: Any technical aspects remaining for the sweepstakes platform? - All core functionality is in place, with ongoing refinements and testing of marketing approaches to ensure effective scaling [36] Question: What types of strategic acquisitions are being considered? - The company is open to meaningful M&A opportunities to bolster efforts in the sweepstakes category and gain market share [40] Question: How does the company manage regulatory pressures regarding sweepstakes? - Management evaluates regulatory risks on a state-by-state basis and adjusts capital deployment accordingly, aiming to legitimize the sweepstakes opportunity [52] Question: Is there enough cash to manage through the transition? - Management confirmed a strong cash position, allowing for aggressive investment in growth initiatives [61]