myps-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For transition period from to

Commission File Number 001-39652

PLAYSTUDIOS, Inc.

(Exact name of registrant as specified in its charter)


Delaware						88-1802794
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)

10150 Covington Cross Drive

Las Vegas, NV 89144

(725) 877-7000

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Class A common stock

MYPS

Nasdaq Stock Market LLC

Redeemable warrants exercisable for one share of Class A common stock at an exercise price of $11.50 per share

MYPSW

Nasdaq Stock Market LLC

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No ☒

As of April 30, 2024, there were 118,346,301 shares of Class A common stock, $0.0001 par value per share, and 16,457,769 shares of Class B common stock, $0.0001 par value per share, outstanding.

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Table of Contents


			Page
Cautionary Note Regarding Forward-Looking Statements			3
Part I - Financial Information			5
Item 1. Financial Statements (Unaudited)			5
Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023			5
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2024 and March 31, 2023			6
Condensed Consolidated Statements of Comprehensive Loss for the Three Months Ended March 31, 2024 and March 31, 2023			7
Condensed Consolidated Statements of Stockholders' Equity for the Three Months Ended March 31, 2024 and March 31, 2023			8
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2024 and March 31, 2023			9
Notes to Unaudited Condensed Consolidated Financial Statements			10
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			24
Item 3. Quantitative and Qualitative Disclosures About Market Risk			34
Item 4. Controls and Procedures			34
Part II - Other Information			36
Item 1. Legal Proceedings			36
Item 1A. Risk Factors			36
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			37
Item 3. Defaults Upon Senior Securities			38
Item 4. Mine Safety Disclosures			38
Item 5. Other Information			38
Item 6. Exhibits			38
Signatures			39

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this Quarterly Report, about our future financial performance, strategy, expansion plans, future operations, future operating results, estimated revenues, losses, projected costs, prospects, plans and objectives of management are forward-looking statements. Any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “continue,” “goal,” “project” or the negative of such terms or other similar expressions.

Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

•our business strategy and market opportunity;

•our future financial performance, including our expectations regarding our revenue, cost of revenue, gross profit, or gross margin, operating expenses (including changes in sales and marketing, research and development, and general and administrative expenses), and profitability;

•market acceptance of our games;

•our ability to raise financing in the future and the global credit and financial markets;

•factors relating to our business, operations, financial performance, and our subsidiaries, including:

◦changes in the competitive and regulated industries in which we operate, variations in operating performance across competitors, and changes in laws and regulations affecting our business,

◦our ability to implement business plans, forecasts, and other expectations, and identify and realize additional opportunities, and

◦general economic conditions and their impact on levels of spending by players, our awards partners, and our advertisers, including risks of inflation and recession and other macroeconomic conditions;

•our ability to maintain relationships with our platforms, such as the Apple App Store, Google Play Store, Amazon Appstore, and Facebook;

•the accounting for our outstanding warrants to purchase shares of Class A common stock;

•our ability to develop, maintain, and improve our internal control over financial reporting;

•our ability to maintain, protect, and enhance our intellectual property rights;

•our ability to successfully defend litigation brought against us;

•our ability to identify, close, and integrate acquisitions to contribute to our growth objectives;

•our success in retaining or recruiting, or changes required in, our officers, key employees or directors;

•the impact of geopolitical conditions, including the wars between Ukraine and Russia and between the State of Israel and Hamas, as well as evolving conflicts in surrounding areas; and

•the impact of public health epidemics or pandemics (including COVID-19) on our business.

These forward-looking statements are based on our current plans, estimates and projections in light of information currently available to us, and are subject to known and unknown risks, uncertainties and assumptions about us, including those described under the heading “Risk Factors” in this Quarterly Report on Form 10-Q, and in other filings that we make with the Securities and Exchange Commission (the “SEC”) from time to time, that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In addition, the risks described under the heading

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“Risk Factors” are not exhaustive. New risk factors emerge from time to time, and it is not possible to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any risk factor or combination of risk factors may cause actual results to differ materially from those contained in any forward-looking statements. Forward-looking statements are also not guarantees of performance. You should not put undue reliance on any forward-looking statements, which speak only as of the date hereof. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q whether as a result of new information, future events or otherwise.

We intend to announce material information to the public through our Investor Relations website, ir.playstudios.com, SEC filings, press releases, public conference calls and public webcasts. We use these channels, as well as social media, to communicate with our investors, customers, and the public about our company, our offerings, and other issues. It is possible that the information we post on our website or social media could be deemed to be material information. As such, we encourage investors, the media, and others to follow the channels listed above, including our website and the social media channels listed on our Investor Relations website, and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page on our website.

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PART I. Financial Information

Item 1. Financial Statements

PLAYSTUDIOS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands, except par value amounts)


	March 31, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	126,980	$	132,889
Receivables	31,944		30,465
Prepaid expenses and other current assets	10,730		11,529
Total current assets	169,654		174,883
Property and equipment, net	17,905		17,549
Operating lease right-of-use assets	8,461		9,369
Intangibles assets and internal-use software, net	108,386		110,933
Goodwill	47,133		47,133
Deferred income taxes	2,711		2,764
Other long-term assets	3,224		3,690
Total non-current assets	187,820		191,438
Total assets	$	357,474	$	366,321

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	3,817		1,907
Warrant liabilities	1,151		1,086
Operating lease liabilities, current	3,461		4,236
Accrued and other current liabilities	29,029		38,796
Total current liabilities	37,458		46,025
Minimum guarantee liability	24,000		24,000
Deferred income taxes	1,001		1,198
Operating lease liabilities, non-current	5,532		5,699
Other long-term liabilities	1,061		1,048
Total non-current liabilities	31,594		31,945
Total liabilities	$	69,052	$	77,970
Commitments and contingencies (Note 17)
Stockholders’ equity:
Preferred stock, $0.0001 par value (100,000 shares authorized, no shares issued and outstanding as of March 31, 2024 and December 31, 2023)	—		—
Class A common stock, $0.0001 par value (2,000,000 shares authorized, 124,551 and 122,923 shares issued, and 118,705 and 118,200 shares outstanding as of March 31, 2024 and December 31, 2023, respectively)	12		12
Class B common stock, $0.0001 par value (25,000 shares authorized, 16,457 and 16,457 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively).	2		2
Additional paid-in capital	315,526		310,944
Retained earnings	(3,204)		(2,637)
Accumulated other comprehensive (loss) income	(984)		124
Treasury stock, at cost, 5,845 and 4,723 shares at March 31, 2024 and December 31, 2023, respectively	(22,930)		(20,094)
Total stockholders’ equity	288,422		288,351
Total liabilities and stockholders’ equity	$	357,474	$	366,321

The accompanying notes are an integral part of these condensed consolidated financial statements.

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PLAYSTUDIOS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share data)


	Three Months Ended March 31,
	2024		2023
Net revenue	$	77,828	$	80,123
Operating expenses:
Cost of revenue(1)	18,951		19,527
Selling and marketing	18,576		18,066
Research and development	18,021		17,755
General and administrative	11,779		11,901
Depreciation and amortization	11,566		11,033
Restructuring and related	638		4,048
Total operating costs and expenses	79,531		82,330
Loss from operations	(1,703)		(2,207)
Other income (expense), net:
Change in fair value of warrant liabilities	(64)		(1,058)
Interest income, net	1,420		895
Other (loss) income, net	(106)		60
Total other income (loss), net	1,250		(103)
Loss before income taxes	(453)		(2,310)
Income tax expense	(114)		(260)
Net loss	$	(567)	$	(2,570)

Net loss per share attributable to Class A and Class B common stockholders:
Basic	$	(0.00)	$	(0.02)
Diluted	$	(0.00)	$	(0.02)
Weighted average shares of common stock outstanding:
Basic	135,575		132,131
Diluted	135,575		132,131

(1)Amounts exclude depreciation and amortization.

The accompanying notes are an integral part of these condensed consolidated financial statements.

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PLAYSTUDIOS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(unaudited, in thousands)


	Three Months Ended March 31,
	2024		2023
Net loss	$	(567)	$	(2,570)
Other comprehensive (loss) income:
Change in foreign currency translation adjustment(1)	(441)		57
Unrealized loss from derivative financial instruments(1)	(499)		—
Reclassification of unrealized loss from settlement of derivative financial instruments included in net loss(1)	(168)		—
Total other comprehensive (loss) income	(1,108)		57
Comprehensive loss	$	(1,675)	$	(2,513)

(1)These amounts are presented gross of the effect of income taxes. The corresponding effects of income taxes are immaterial.

The accompanying notes are an integral part of these condensed consolidated financial statements.

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PLAYSTUDIOS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(unaudited, in thousands)


	Class A Common Stock			Class B Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)						Total Stockholders' Equity
	Shares	Amount		Shares	Amount						Retained Earnings		Treasury Stock
Balance as of December 31, 2022	115,635	$	11	16,457	$	2	$	290,337	$	(151)	$	16,756	$	(4,642)	$	302,313
Net loss	—	—		—	—		—		—		(2,570)		—		(2,570)
Exercise of stock options	1,585	—		—	—		1,916		—		—		—		1,916
Restricted stock vesting, net of shares withheld	481	—		—	—		—		—		—		—		—
Stock-based compensation	—	—		—	—		5,409		—		—		—		5,409
Repurchase of common stock	(1,254)	—		—	—		—		—		—		(5,406)		(5,406)
Other comprehensive income	—	—		—	—		—		57		—		—		57
Balance as of March 31, 2023	116,447	$	11	16,457	$	2	$	297,662	$	(94)	$	14,186	$	(10,048)	$	301,719


	Class A Common Stock	Class B Common Stock			Additional Paid-In Capital	Accumulated Other Comprehensive Loss								Total Stockholders' Equity
		Shares	Amount					Shares			Amount					Retained Earnings		Treasury Stock
Balance as of December 31, 2023		118,200	$	12	16,457	$	2		$	310,944		$	124	$	(2,637)		(20,094)		288,351
Net loss		—	—		—	—			—			—		(567)			—		(567)
Exercise of stock options		77	—		—	—			77			—		—			—		77
Restricted stock vesting, net of shares withheld		1,551	—		—	—			(686)			—		—			—		(686)
Stock-based compensation		—	—		—	—			5,191			—		—			—		5,191
Repurchase of common stock		(1,123)	—		—	—			—			—		—			(2,836)		(2,836)
Other comprehensive loss		—	—		—	—			—			(1,108)		—			—		(1,108)
Balance as of March 31, 2024		118,705	$	12	16,457	$	2		$	315,526		$	(984)	$	(3,204)		(22,930)		$	288,422

The accompanying notes are an integral part of these condensed consolidated financial statements

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PLAYSTUDIOS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)


	Three Months Ended March 31,
	2024		2023
Cash flows from operating activities:
Net loss	$	(567)	$	(2,570)
Adjustments:
Depreciation and amortization	11,566		11,033
Amortization of loan costs	38		38
Stock-based compensation expense	4,794		4,853
Change in fair value of warrant liabilities	64		1,058
Change in fair value of contingent consideration	—		53

Deferred income tax expense	(134)		(2,228)
Other	114		(179)
Changes in operating assets and liabilities
Receivables	(1,595)		(6,861)
Prepaid expenses and other current assets	(1,081)		201
Income tax receivable	(425)		2,128
Accounts payable & accrued liabilities	(7,865)		(3,492)
Other	89		469
Net cash provided by operating activities	4,998

SEC Form 10-Q filed by PLAYSTUDIOS Inc.