Financial Data and Key Metrics Changes - Revenue for fiscal year 2025 grew 32% year over year to $98.4 million, driven by seven new game launches generating approximately $32.3 million [3][4] - Operating loss recorded at $1.1 million compared to operating income of $6.7 million in the previous year, attributed to strategic investments in AI and marketing [4][5] - Adjusted EBITDA decreased to $8 million from $12 million in fiscal year 2024, reflecting higher personnel and marketing investments [5][6] - Cash and cash equivalents stood at $12.2 million as of July 31, 2025, with no debt on the balance sheet [6] Business Line Data and Key Metrics Changes - Segment profit increased by $4.3 million year over year to $31.3 million, indicating improved operational efficiency [5] - The two top-performing titles were "Soul Ama: Spider's Soul World - Ruler of Labyrinth" contributing approximately $14.2 million and "A Rift of Rita: Rebellion's Soul" contributing about $9.3 million [3][4] Market Data and Key Metrics Changes - Growth was strong across all major regions, with significant advertising and marketing investments made outside Japan to support international expansion [4][14] - The company is expanding its footprint in the U.S. and plans to open a new office in New York City to enhance local capabilities [7][8] Company Strategy and Development Direction - The company aims to translate recent investments into growth and operating leverage, focusing on efficiency gains across marketing and user engagement [7] - Plans to continue disciplined investments in talent, infrastructure, and marketing to support a larger global footprint [7][8] - The company is exploring potential M&A opportunities in the U.S. market to enhance growth [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued top-line growth driven by an expanding global presence and upcoming game releases [7][8] - The North American market is expected to grow significantly, with potential for it to lead in revenue generation for certain titles in the future [22][33] Other Important Information - The company completed its initial public offering on Nasdaq, raising $12 million in gross proceeds [6] - The focus remains on long-term value creation while maintaining a healthy balance sheet and positive operating cash flows [8] Q&A Session Summary Question: What is driving accelerated revenue growth in the second half? - The growth is attributed to the addition of new titles and increased international marketing efforts, particularly outside Japan [12][14] Question: What is the expected timeline for launching games in pre-registration and backlog? - Most games in pre-registration are expected to launch within the current fiscal year, with efforts being made to expedite the process [17][19] Question: What are the expectations for the North American market? - The North American market is anticipated to grow significantly, with potential to match or exceed the Japanese market in certain titles [22][33] Question: What sets CTW apart from its competitors in securing attractive anime IP rights? - Strong relationships with IP holders, a frictionless HTML5 platform, and advanced AI-backed marketing tools are key competitive advantages [24][25] Question: What initiatives are in place for growing the U.S. market? - The company is focusing on organic growth, opening a local office, and exploring M&A opportunities with established marketing channels [31] Question: Are North American users expected to become higher spenders than Japanese users? - There is potential for North American users to become significant spenders, with expectations of increased whale customers in the mid to long term [32][33] Question: What new capabilities are being developed in AI-driven user acquisition? - Investments are being made in optimizing advertisement management systems and enhancing AI tools for game development and marketing [39][41]
CTW Cayman-A(CTW) - 2025 Q4 - Earnings Call Transcript