GCIGuild Esports shares jump 22% on Coca-Cola sponsorship deal
( ) has agreed a milestone one-year global sponsorship deal with the Coca-Cola Company. The soft drinks giant is the sixth sponsor signed by Guild and will be the company's "Official Soft Drinks & Hydration Partner" effective immediately.
Guild Esports is the first ever European esports organisation to sign a sponsorship deal with Coca-Cola. The total contract value is payable in cash, but the amount was kept confidential.
Kal Hourd, CEO, commented: "Guild is signing up some of the world's most respected brands and we are very proud to welcome Coca-Cola as a sponsor and partner. They want to collaborate with Guild because we deliver great entertainment and memorable experiences for a millennial, hard-to-reach audience in one of the fastest growing segments of the sports entertainment industry."
Markets cheered the news, sending shares soaring 22.73% this morning.
View from Vox
Guild recently delivered a 6-month update where some of its other partnerships referenced by Mr. Hourd were detailed, including deals with Bitstamp, Samsung, and Sony PlayStation. With Bitstamp, Guild signed its largest ever £4.5m 3-year sponsorship deal, bringing total signed sponsorship revenue to £8.56m.
The company also said it was in advanced stages of negotiation with around 30 tier-1 brands, helped along by the success of its eSports teams, which have been winning trophies in major tournaments this year. Today's deal with Coca-Cola is further testament to Guild's rapidly growing number of tier-1 sponsors.
In the same update, Guild reporting a tripling of revenue to £1.1m, reflecting the growth in sponsorship income. That drove a 6-fold increase in gross profit to £710,000, although pre-tax losses widened by 15% as the company made long-term investments in teams and content creation amongst other things, which are expected to drive future growth.
Guild said that ongoing improvements to the efficiency of operations were expected to lead to a 20% decrease in costs. Net cash for Guild stood at a comfortable £6.1m on 31 March 2022, and its shares also commenced trading on the US OTCQB Venture Market.
According to Newzoo, there are now more than 2.7 billion gamers globally, with gaming overtaking social media as the largest consumption of screen time in most developed markets. By 2023, Newzoo predicts the gaming market will be worth $200.8 billion a year, with the number of players worldwide surpassing the three-billion mark. With its revenues multiplying, a growing pipeline of sponsorship deals, and a strong cash position, and its parent are in a strong position to benefit from this growth.
Follow News & Updates from Guild Esports:
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.