Motorsport Games (NasdaqCM:MSGM) Q3 2025 Earnings Call November 06, 2025 05:00 PM ET Speaker2Thank you for standing by and welcome to Motorsport Games' third quarter 2025 earnings call. As a reminder, today's conference is being recorded. I would like to turn the conference over to Ben Rossiter-Turner from Motorsport Games. Please go ahead.Speaker3Thank you and welcome to Motorsport Games' third quarter 2025 earnings conference call and webcast. On today's call is Motorsport Games' Chief Executive Officer S ...

Motorsport Games Reports Third Quarter 2025 Financial Results Motorsport Games (Nasdaq:MSGM) reported revenues of $3.1m, an increase of 71.8% on Q3 in the prior year with a second successive quarter with net income from operations. MIRAMAR, Fla., Nov. 06, 2025 (GLOBE NEWSWIRE) -- Motorsport Games Inc. (NASDAQ: MSGM) (“Motorsport Games” or “the Company”) today reported financial results for its third quarter ended September 30, 2025. The Company has also posted the third quarter 2025 earnings slides high ...

Core Viewpoint - Motorsport Games Inc. will report its financial results for the third quarter of 2025 on November 6, 2025, after market close, followed by a conference call to discuss the results [1][6]. Company Overview - Motorsport Games is a racing game developer, publisher, and esports ecosystem provider, focusing on official motorsport racing series [3]. - The company is the officially licensed developer for notable racing series such as the 24 Hours of Le Mans and the FIA World Endurance Championship, with recent releases including Le Mans Ultimate Version 1.0 [3]. - Motorsport Games owns leading simulation platforms like rFactor 2 and KartKraft, and has partnered with Kindred Concepts to power F1® Arcade [3]. - The company is recognized as an award-winning esports partner for the 24 Hours of Le Mans, creating the Le Mans Virtual Series [3]. Financial Reporting - The financial results for Q3 2025 will be discussed in a conference call and webcast on November 6, 2025, at 5:00 p.m. ET [1][2]. - Participants can access the webcast through the company's investor relations website and will have access to a recording for 12 months [2].

Core Insights - Motorsport Games Inc. has released Le Mans Ultimate Version 1.1, which includes significant new content and features aimed at enhancing the game's scope and accessibility following a successful summer launch of Version 1.0 [1][6] Game Updates - The major addition in Version 1.1 is the European Le Mans Series (ELMS), marking its first official representation in Le Mans Ultimate. Players will receive free access to ELMS liveries and an unrestricted LMP2 car with updated physics [2][3] - The first ELMS Pack is priced at £8.99/€9.99/$11.99, or available as part of a discounted Season Pass at £21.99/€24.99/$28.99, with a 10% launch discount for a limited time [2] - Pack 1 features the Silverstone Circuit and the Ligier JS P325 LMP3, introducing a new prototype class and exciting endurance racing formats. Additional ELMS packs are planned for late 2025 and early 2026 [3] Customization and Multiplayer Enhancements - The custom livery system has been enhanced, allowing players to use their liveries in single-player Race Weekends and adding support for custom numbers. The update also introduces LiveryHub for sharing designs [4] - Version 1.1 introduces regional hosted servers in Asia and North America to improve multiplayer experiences by reducing latency. Other improvements include refinements to car selection menus, native TrackIR support, and the addition of Simplified Chinese language [5] Company Commitment - The CEO of Motorsport Games emphasized the update as a step forward in building on the momentum from the summer, reinforcing the company's commitment to delivering an authentic and engaging endurance racing experience [6]

Summary of Motorsport Games Inc. Conference Call Company Overview - **Company**: Motorsport Games Inc. - **Ticker**: MSGM - **Industry**: Video Game Development, specifically focused on racing games and eSports - **Staff**: 41 employees, primarily developers and engineers [5] Core Business Model - Motorsport Games develops, publishes, and manages a backend platform for racing games, aiming to enhance customer experience and monetize through subscription services [4] - The company focuses on simplifying the sim racing segment, which has been characterized by outdated products and fragmented experiences [4] Key Products - **Le Mans Ultimate**: - Recently launched version 1.0 after 18 months in Early Access [6] - Officially licensed title associated with the 24 Hours of Le Mans race [7] - Features a unique squad-based gameplay allowing players to take turns in a single car [10] - Sold over 240,000 units with a strong following despite minimal marketing [11] - **rFactor 2**: - Legacy product known for high-end racing simulation technology [15] - Continues to perform well and supports the development of newer titles [15] Financial Performance - Significant operating losses were reported historically, with a peak loss of $16 million in Q1 2022 [22] - Recent turnaround efforts led to a net income of $4.2 million in Q2 2025, with revenues up 37.7% year-over-year [23] - First quarter in company history to generate income from operations [23] - Monthly cash flow from operations averaged $46,000 for the first half of 2025, significantly improved from previous years [24] Market Insights - The racing video game market was valued at over $5 billion in 2024 and is projected to grow to over $6.9 billion by 2032 [27] - The racing simulator market is expected to grow at a rate of 15.6% during the same period [27] - The acquisition of Codemasters by Electronic Arts for $1.2 billion highlights the market's potential [27] Strategic Initiatives - Plans to port Le Mans Ultimate to gaming consoles (Xbox and PlayStation) to reach a larger audience [29] - Ongoing discussions for potential new driving or racing experiences leveraging existing technology [30] - Collaboration with F1 Arcade and Liberty Media to expand opportunities in the racing simulation space [30] Management and Governance - New management team and Board of Directors in place to drive the company's turnaround [28] - Leadership includes experienced professionals from the gaming industry and finance [25][26] Conclusion - Motorsport Games Inc. is positioned for growth with a strong product lineup and strategic initiatives aimed at expanding its market presence and improving financial performance [28][30]

Company Overview - Motorsport Games Inc. is a racing game developer, publisher, and esports ecosystem provider, focusing on official motorsport racing series [4] - The company is known for its innovative video games and engaging esports competitions, aiming to create racing games that closely resemble reality [4] - Motorsport Games holds licenses for iconic racing series such as the 24 Hours of Le Mans and the FIA World Endurance Championship, with recent releases including Le Mans Ultimate Version 1.0 [4] Upcoming Events - The CEO Stephen Hood and CFO Stanley Beckley will present and host one-on-one meetings with investors at the H.C. Wainwright 27th Annual Global Investment Conference from September 8-10, 2025, in New York City [1][7] - Investors can schedule one-on-one meetings with the executives by contacting the company via email [2] Investor Relations - A replay of the conference webcast will be available on the investor section of Motorsport Games' website [2] - The company utilizes various channels, including its investor relations website and social media, to communicate material financial information to investors [6]

Company Overview - Motorsport Games Inc. is a racing game developer, publisher, and esports ecosystem provider, focusing on official motorsport racing series [4] - The company is the officially licensed developer for notable racing series such as the 24 Hours of Le Mans and the FIA World Endurance Championship [4] - Recent product releases include Le Mans Ultimate Version 1.0, featuring new cars and updated 2025 content [4] Investor Engagement - The company will present at the Sidoti August Virtual Investor Conference on August 20-21, 2025, with CEO Stephen Hood and CFO Stanley Beckley hosting one-on-one meetings with investors [1][2] - The presentation is scheduled to begin at 9:15 AM ET on August 20, 2025, and will be accessible via a provided link [2] Industry Context - Sidoti & Company, LLC has established Sidoti Events, LLC to enhance its conference business, focusing on small and microcap companies [3] - Sidoti's coverage includes approximately 150 equities, with a significant portion participating in its Company Sponsored Research and Lighthouse Equity Research programs [3]

Core Viewpoint - Motorsport Games Inc. reported significant growth in its second quarter of 2025, with record player activity and increased revenues driven by the success of the Le Mans Ultimate game and its marketing efforts [2][3]. Financial Highlights - Consolidated revenue for Q2 2025 was approximately $2.6 million, a 37.7% increase from approximately $1.9 million in Q2 2024 [3]. - Gross profit rose to $2.1 million, up from $1.1 million year-over-year, with a gross profit margin increase to 82.4% from 59.0% [3]. - Net income for Q2 2025 was $4.2 million, an improvement of 103.0% compared to $2.1 million in Q2 2024, with net income per share for Class A common stock at $0.82, up from $0.77 [4][10]. - Adjusted EBITDA for Q2 2025 was $3.7 million, a significant improvement from an Adjusted EBITDA loss of $0.5 million in the same period last year [5]. Operational Developments - The company released Le Mans Ultimate Version 1.0 on July 22, 2025, featuring new cars and advanced game mechanics [10]. - The expansion downloadable content for Le Mans Ultimate, including the European Le Mans Series, is expected to be delivered by the end of Q3 2025 [2]. Cash Flow and Liquidity - As of June 30, 2025, the company had cash and cash equivalents of approximately $2.4 million, which increased to $2.8 million by July 31, 2025 [11]. - The company generated an average positive cash flow from operations of approximately $46,000 per month during the first half of 2025, primarily due to settlements with Wesco Insurance Company and HC2 Holdings [11]. Future Outlook - The company is focused on further growing the Le Mans franchise and exploring new titles to diversify its income streams [2]. - Future liquidity and capital requirements will support ongoing operations, product development, and capital expenditures [12].

Core Viewpoint - Motorsport Games Inc. will report its financial results for the second quarter of 2025 on August 13, 2025, after market close, followed by a conference call to discuss the results [1][6]. Company Overview - Motorsport Games is a racing game developer, publisher, and esports ecosystem provider, focusing on official motorsport racing series [3]. - The company is the officially licensed developer and publisher for notable racing series such as the 24 Hours of Le Mans and the FIA World Endurance Championship [3]. - Recently, Motorsport Games released Le Mans Ultimate Version 1.0, which includes new cars, updated 2025 content, and additional improvements [3]. - The company owns leading simulation platforms, rFactor 2 and KartKraft, and powers F1® Arcade through a partnership with Kindred Concepts [3]. - Motorsport Games is recognized as an award-winning esports partner for the 24 Hours of Le Mans, creating the Le Mans Virtual Series [3]. Financial Communication - Participants can access the financial results webcast on the company's investor relations website and it will remain available for 12 months [2]. - The conference call can be accessed live via phone with specific dial-in numbers and a Conference ID [2].

Core Viewpoint - Motorsport Games Inc. has officially released Le Mans Ultimate Version 1.0, marking the end of its Early Access phase and initiating a new phase of development and expansion for the game [1][6][10] New Features and Additions - The 1.0 release includes two new cars, the Aston Martin Valkyrie AMR LMH and the Mercedes AMG LMGT3, available at no extra cost, enhancing the gameplay experience with high-performance vehicles [2][10] - The update also features the BMW M4 Evo LMGT3, updated to 2025 specifications, available for free to previous owners of the M4 [2][10] Gameplay Enhancements - Version 1.0 introduces significant gameplay refinements, including a revised LMGT3 tyre model to improve grip loss and thermal operating windows, aiming for a smoother experience for players [3][10] - Usability improvements include a reworked car setup interface that consolidates critical elements into a single screen and an extended Race Weekend calendar for the full 2025 season [3][10] Purchasing Experience - The game's Steam store configuration has been updated, integrating previously free DLCs into the core game and introducing a new 2024 WEC Bundle for easier access to post-launch content [4][10] Future Development Plans - The company is actively developing the European Le Mans Series and plans to showcase a hands-on build during the Silverstone ELMS weekend in September [6][10] - A full-featured single-player career mode is in the works, with a planned release for early 2026 [6][10] Company Overview - Motorsport Games is a developer and publisher of racing games, focusing on creating authentic racing experiences and building a virtual racing ecosystem that includes esports competitions [7][10]