Gfinity expects investment in esports platform to drive revenue growth from 2023

 ( ), an esports and gaming solutions provider, announced audited final results for the year ended 30 June 2022 (FY22).

Financial performance

Revenues declined 8% to £5.3m, but revenues attached to Gfinity's owned audience, technology, and esports properties increased 33%. Despite the reduction in revenues, gross profit increased 4% to £2.7m.

Adjusted administrative expenses came in at £4.7m, down 13% year-on-year. Year-end cash stood at £2.1m, with a further £2.7m in unexercised warrants.

Gfinity reported a reduction of 28% in adjusted operating loss to £2m in FY22, compared to £2.7m in FY21. This follows a 50% reduction in 2021, and a 36% reduction in 2022.

Operational highlights

Gfinity recorded a 36% increase in average monthly active users to 14.5 million, with revenue per monthly active user rising 29% to 20p from 15p in FY21.

Gfinity also acquired the Stock Informer brand during the period, and developed its proprietary CMS facilitating publishing at scale.

John Clarke, CEO, commented:

"The transformation of Gfinity's business model is now well underway. It is delivering improved financial performance and we continue on a pathway towards profitable growth. We are building shareholder value through Athlos, our owned tech IP licensing business. The plug and play nature of what the team has built is gaining momentum, being adopted by game publishers large and small. Our owned community of hard to reach gamers, GDM, is driving value by deepening engagement with users. And our excellence in the digital racing and football space makes Gfinity a partner of choice with leading sports rights holders and brands. Competitive gaming is a growth sector and Gfinity has carved a niche for itself in the evolving ecosystem in the past year. This will serve us well in the years ahead."

View from Vox

Gfinity's focus on building growth around its own proprietary technology is paying off as the company recorded 4% higher revenues in that space despite an 8% reduction in total revenues. This reflects the much higher margins available to the company when using its own intellectual property.

The 8% reduction in revenues this year that markets have focused on today amid thin trading volumes, is mostly the result of Gfinity's aforementioned restructuring and reprioritisation toward its own assets. Within the numbers, there is much for investors to get excited about. Adjusted operating losses continued to decline, and the company recorded a 36% increase in average monthly users to 14m, with revenue per user up 29% to 20p. Gfinity also acquired Stock Informer during the period, opening a potential ecommerce revenue stream.

There is clear demand for Gfinity's platform. The company renewed contracts to deploy its technology to three of the largest mobile games in the world. Additionally, Gfinity recorded a 63% increase in revenue attached to licensing and implementation of its technology outside of programmes where it also manages the tournament. And during the 4th season of the F1 Esports Series, Gfinity recorded a 103% year-on-year increase in views to 23 million. Coca Cola, Nintendo, and Manchester United are now among the company's clients.

Additionally, to facilitate deployment at scale of its platform under a SaaS licensing model, Gfinity invested £0.7m in the development of Athlos, its owned tech IP licensing business. Deployment will begin in 1Q 2023.

Gfinity continues to make progress toward profitablility. The company's continued investment into its proprietary esports technologies should drive revenue growth from 2023 as the esports and gaming sectors continue to expand.

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