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spk01: Greetings, and welcome to the Allied Gaming and Entertainment Inc. first quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. If any of you require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Tyler Drew of Addo Investor Relations. Please go ahead.
spk03: Thank you, Operator. Good afternoon and welcome to the Allied Gaming and Entertainment first quarter 2024 earnings conference call. Speaking on the call today are Allied Gaming and Entertainment's Chief Executive Officer Yinghua Chen and Chief Financial Officer Roy Anderson. Before I turn the call over to management, please note that our prepared remarks may contain forward-looking statements. Words such as may, will, expect, intend, plan, believe, seek, could, Estimate, judgment, targeting, should, anticipate, goal, variations of these words and similar expressions are intended to identify forward-looking statements. Actual results could differ materially from those implied by such forward-looking statements due to a variety of factors discussed in the company's public filings, including the risk factors discussed in documents filed with the Securities and Exchange Commission. Although the company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be attained. The company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise. In addition, certain of the financial information presented in this call represents non-GAAP financial measures. The company's earnings release, which was issued this afternoon and is available on the company's website, presents definitions of such non-GAAP financial measures, reconciliations to the appropriate GAAP measures, and an explanation of why the company believes such non-GAAP financial measures are useful to investors. And with that, it is now my pleasure to turn the call over to Allied Gaming and Entertainment CEO Yinghua Chen. Yinghua.
spk00: Thank you, Tyler. And thank you all for joining us this afternoon. We've had a strong start to the year following the momentum built in 2023. First quarter 2024, total revenues of $2.4 million were up 99% from the first quarter of 2023, while our net loss also improved. The improvement in revenues was primarily driven by our casual mobile gaming segment following our strategic investment in ZTEK. Turning to Ally Esports International, or AEI, the HyperX Arena has been bustling with activity. Throughout the first quarter, we hosted a diverse range of events, totally 63 events, comprising 33 proprietary events and 30 third-party events. February in particular was a busy month, as we hosted a number of Super Bowl festivities back-to-back, with this year's big game taking place just down the road in Las Vegas. We hosted Play Versus Live Great Iron Showdown, the Super Bowl's largest youth-focused sports event, which was a great way to introduce more students to the world of esports. The second annual P&G Battle of the Paddles at Super Bowl 58, where NFL stars, including Saquon Barkley and Trevor Lawrence, battled it out in a head-to-head tournament to decide the unofficial best table tennis player in the NFL. The show has won the Livestream Presentation Award from Synopsys Sports. Also, our Super Bowl watch party on game day was well attended as fans watched the big game on our state-of-the-art LED video wall while experiencing the heat from the Allegiant Stadium just across the street. Additional notable events at HyperX Arena during the quarter included the third annual Battle for Charity esports tournament, which brought together esports professionals, influencers, and streamers who competed in a live Valorant tournament for charity and corporate events like GitLab Blitz Experience. Moving on to our proprietary content, Season 2 of Wannabe, which explores the journeys of professional gamers and professional athletes who have appeared on the YES Network is now fully available on the YES app and has again garnered strong interest from our viewers. We are thrilled to announce our partnership with Positively Arts, an organization dedicated to nurturing young talent and fostering essential life skills through the transformative power of the arts. Together, we embark on an inspiring journey with our elevated series show, The Gem, the journey of artists and mentors. In this show, we join forces with celebrity judges to select standout performers from the talented youth who have benefited from Positively Arts program. These promising young artists are then paired with renowned mentors, creating a dynamic synergy aimed at not just enhancing their artistic skill, but more importantly, guiding them along a path of personal growth and emotional resilience. The Jam offers viewers a compelling documentary-style exploration of the audition and the mentorship process, providing an intimate look into the backgrounds and aspirations of our contestants. Terminating in the live performance showcase, this series celebrates the achievements of these aspiring stars and their remarkable journey marked by both triumphs and challenges. We also continue to explore different content opportunities with crossovers between gaming and other industries, and we'll update you further as appropriate. Turning to Allied Mobile Entertainment, or AME, Now that Beijing Lianzhong Zhihe Technology or ZTECH has been fully integrated into AME, we are working on strategies to accelerate its growth opportunities. Although revenue in the quarter was slightly below expectations, we anticipate improved performance in Q2 and beyond, with the addition of new casual mobile game titles to attract more new users. Allied Experiential Entertainment or AEE had a busy Q1 while executing agreements and gearing up for upcoming events in Asia. As previously announced, our joint ventures guideline recently hosted its inaugural event, a Walk of the Earth concert on April 4th in China. The local community showed great enthusiasm and fans were treated to live performance of their favorite hits. which garnered hundreds of millions of views across social platforms. Preparations are underway for the inaugural WPT Wayne Macau tournament, which runs from June 18 to 24. We expect poker stars from all over the world will join us to compete with the championship and high roller events featuring buy-ins of Hong Kong dollar 40,000 and Hong Kong dollar 200,000, respectively. Along with Win Macau and World Poker Tour, we look forward to hosting this event on an annual basis while also exploring additional opportunities to partner together. I will now turn the call over to our CFO, Roy Anderson, to provide updates on our Q1 financials.
spk02: Thank you, Yinghua. Good afternoon, everyone, and thank you for joining us today. Total revenues for the first quarter of 2024 were $2.4 million, up 99% from the first quarter of 2023. The increase was primarily driven by revenues of $1.1 million from our recent strategic investment in ZTECH. Revenues from our allied esports segment were up 5% from the prior year period. Total costs and expenses for the first quarter were $5.1 million, an increase of 31% compared to the prior year period. The increase in cost consists primarily of ZTECH's operating expenses, including the amortization of its intangible assets and non-cash stock-based compensation. Our net loss was $1.8 million for the first quarter of 2024, down from a loss of $1.9 million in the first quarter of 2023. Our adjusted EBITDA loss of $1.7 million was down from a loss of $2.0 million in the first quarter of 2023. Our adjusted EBITDA includes adjustments for the depreciation and amortization of fixed and tangible assets, stock-based compensation, and interest income. Now moving on to our balance sheet. At March 31st, 2024, Our cash and short-term investments position totaled $83.3 million, including $5 million of restricted cash, compared to $78.6 million at December 31st, 2023. I will now turn the call back over to Yinghua.
spk00: Thank you, Roy. In summary, it was a strong start to the year, and we're well set up to see progress throughout 2024. Along with our confirmed event in the second quarter, We have a robust pipeline in front of us, both locally and abroad. And ZTAC is trending well as we look to further capitalize on the massive market of gaming and entertainment. Thank you for your time today. We look forward to speaking with you again when we release our second quarter 2024 results in August.
spk01: Thank you. This concludes today's conference. You may now disconnect your lines. Enjoy the rest of your day.
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