Release Date: April 25, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- OverActive Media Corp (OAMCF, Financial) reported record Q4 revenue of CAD9.9 million, contributing to a full year revenue of CAD27 million, a 72% increase year over year.
- The company completed two strategic acquisitions, KOI and Movistar Riders, which were immediately accretive and exceeded expectations for revenue and adjusted EBITDA.
- OverActive Media Corp (OAMCF) expanded into new high-growth markets, including launching a Free Fire team in Mexico and expanding into China with localized content.
- The company signed significant commercial partnerships, including the first naming rights deal in LEC history with Telefonica, and renewed major partnerships with AMD, BA, and Scuff Gaming.
- The restructuring of the LEC franchise agreement eliminated future franchise obligations and secured full ownership of the slot, improving the balance sheet and strategic control.
Negative Points
- The gross margin for Q4 2024 declined to 54% from 80% in Q4 2023, primarily due to the integration of low-margin business lines.
- Operating costs for Q4 increased by 54% to CAD6.6 million, driven by additional staffing and infrastructure expenses related to acquisitions.
- The company reported an adjusted EBITDA loss of CAD554,000 for Q4 2024, although this was an improvement from the previous year.
- Comprehensive loss for Q4 was CAD1.3 million, mainly due to foreign currency translation, compared to a loss of CAD768,000 last year.
- The cash balance at the end of the year decreased to CAD6.8 million from CAD8.6 million in 2023, reflecting short-term obligations from acquisitions.
Q & A Highlights
Q: Can you elaborate on the strategic acquisitions made in 2024 and their impact on OverActive Media's financial performance?
A: Adam Adamou, CEO: In 2024, we completed two strategic acquisitions, KOI and Movistar Riders, which were immediately accretive. These acquisitions exceeded our expectations for revenue and adjusted EBITDA, contributing to a 72% year-over-year increase in full-year revenue to CAD27 million. They also helped us diversify our offerings and expand our geographic footprint in Europe and Latin America.
Q: What were the key drivers behind the record Q4 revenue of CAD9.9 million?
A: Rikesh Shah, CFO: The record Q4 revenue was driven by expanded league revenue share, strengthened commercial partnerships, and the successful launch of our influencer agency operations. These factors, along with the integration of our acquisitions, significantly contributed to the 134% increase compared to the same period last year.
Q: How did the restructuring of the League of Legends EMEA Championship Agreement impact OverActive Media's financial position?
A: Rikesh Shah, CFO: The restructuring eliminated all future franchise obligations tied to our LEC slot, securing full ownership of our franchise. This move removed long-term liabilities, strengthened our control over core assets, and provided more financial agility for pursuing global growth opportunities.
Q: What are the company's strategic priorities for 2025?
A: Adam Adamou, CEO: Our focus for 2025 is on scalability through digital and high-margin verticals, growth in markets where our brands and teams already resonate, and profitability through discipline, efficiency, and focused execution. We aim to deliver long-term value to our shareholders, partners, and fans.
Q: Can you discuss the changes in gross margin and operating costs in 2024?
A: Rikesh Shah, CFO: The gross margin for Q4 was 54%, down from 80% in Q4 2023, due to the integration of lower-margin business lines like influencer services and live event production. Operating costs increased by 54% in Q4, primarily due to additional staffing and content production expenses related to our acquisitions. Despite these changes, the absolute increase in gross profit highlights the strength of our revenue engine.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
