GameSquare (GAME) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 revenue of $26.4 million, up 10% year-over-year on a pro forma basis, reflecting organic growth, successful integration of acquisitions, and improved market dynamics.

• Adjusted EBITDA loss narrowed to $2.2 million from $10.4 million year-over-year and $5.4 million sequentially, driven by cost reductions and gross margin expansion.

• Completed integration of FaZe Clan, divested non-core assets, and focused on leveraging owned IP, agency, media, and SaaS technology for profitable growth.

• Major creator-led reboot of FaZe Media, including new investments and leadership, resulted in record engagement and monetization opportunities.

• Management expects 2024 to be a record year, with annual pro forma revenue guidance of $105–$110 million and continued profitability improvements.

Financial highlights

• Q3 2024 revenue was $26.4 million, up from $11.5 million in Q3 2023; gross profit was $5.2 million, up from $2.5 million.

• Gross margin improved to $5.2 million (19.8% of sales) from $3.4 million (14%) year-over-year.

• Adjusted EBITDA loss reduced to $2.2 million (8.2% of revenue) from $10.4 million (43.4%) year-over-year.

• FaZe Esports contributed $4.8 million in revenue and positive Adjusted EBITDA for the quarter.

• Net loss attributable to shareholders was $5.5 million in Q3 2024, compared to $5.1 million in Q3 2023.

Outlook and guidance

• Projecting full-year 2024 revenue between $105 million and $110 million, including a full year of FaZe Clan contribution.

• Expecting record revenue, backlog, and retainer customers by year-end, with strong growth and improved profitability in 2025.

• Ongoing cost reductions, especially from FaZe Clan integration, are expected to further improve profitability in Q4 2024.

• Anticipating continued margin expansion as higher-margin agency and SaaS businesses grow.