Playstudios Q2 revenue misses estimates on legacy portfolio pressure
MYPS•Result drivers
- Legacy portfolio pressure - Co said revenue and audience for its legacy social casino games continued to decline due to persistent secular headwinds.
- Direct-to-consumer growth - Direct-to-consumer revenue more than doubled and made up a larger share of in-app purchases, supporting improved platform economics.
- Restructuring and cost cuts - Co continued to implement restructuring and cost reduction measures, including studio closures and job cuts, to lower fixed costs and improve profitability.
Analyst coverage
- The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy," 2 "hold" and no "sell" or "strong sell."
- The average consensus recommendation for the software peer group is "buy."
- Wall Street's median 12-month price target for PLAYSTUDIOS, Inc. is $0.50, about 25.4% below its August 10 closing price of $0.67.
Outlook and priorities
- Company is not providing formal financial guidance at this time.
- Company's near-term priority is to complete Renewal, stabilize portfolio, and improve margins.
- Investments in new initiatives will be selective and may be reduced or suspended if returns do not meet standards.
