DoubleDown Interactive Co., Ltd.

Good afternoon, and welcome to Double Down's earnings conference call for the financial results for the second quarter ended June 30, 2022. My name is Gary, and I will be your operator this afternoon. Prior to this call, Double Down issued its unaudited financial results for the second quarter 2022 in a press release, a copy of which has been furnished in a report on Form 6-K filed with the SEC and is available in the investor relations section of the company's website. at www.doubledowninteractive.com. You can find the link to the investor relations section at the top of the homepage. Joining us on today's call are Double Down's CEO, Mr. N. Cook Kim, and its CFO, Mr. Joe Sigrist. Following their remarks, we will open the call for questions. Before we begin, Mr. Gramp, the company's outside investor relations advisor, will make a brief introductory statement. Mr. Gramp?

Thank you, Gary. Before management begins their formal remarks, we need to remind everyone that some of management's comments today will be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended, and we hereby claim the protection of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements about future events and include expectations and projections. not present or historical facts, and can be identified by use of the words such as may, might, will, expect, assume, believe, intend, estimate, continue, should, anticipate, or other similar terms. Forward-looking statements include and are not limited to those regarding the company's future plans, mergers and acquisition strategy, strategic and financial objectives, expected performance, and financial outlook. Forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially and adversely from what the company expects. Therefore, you should exercise caution in interpreting and relying on them. We refer you to Double Down's annual report on Form 20F filed with the SEC on April 4, 2022, and other SEC filings for more detailed discussion of the risks that could impact future operating results and financial condition. These forward-looking statements are made only as of the date of this call. The company does not undertake and expressly disclaims any obligation to update or alter the forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. During the call, management will discuss non-GAAP measures, which are believed by management to be useful in evaluating the company's operating performance. These measures should not be considered superior to, in isolation, or as a substitute for the financial results prepared in accordance with GAAP. A full reconciliation of these measures to the most directly comparable gap measure is available in the earnings release and on the form 6K filed with the SEC prior to this call. I would like to remind everyone that this call is being recorded and will be made available for replay via a link available in the investor relations section of Double Down's website. Now, I would like to turn the call over to Double Down's CEO, Mr. Inko Kim.

Thank you, Jeff. Good afternoon, everyone. Thank you for joining us on the earning call for our second quarter 2022 results. During the second quarter of 2022, we continued our lengthy track record of healthy financial results that are intrinsic to our high margin capital life business model. This is evidenced by the $21.1 million in cash flow generated from operations in the quarter or 43 cents per ADS and an adjusted EBITDA margin of 32.4%, which is improved from the first quarter of 2022. These results also illustrate what we'd consider the adaptability of our business model to varying industry and macroeconomic conditions with a positive operating cash flows driving an increase in our cash and cash equivalents and short-term investments balance to $284 million. While revenue was down from the prior year period from $93.2 million to $80.6 million, our results continue to be above pre-COVID levels with revenue in the first half of 2022 exceeding 2019 levels by over 20%. We believe this shows our ability to have both acquired productive new players and expanded overall paying behavior during the COVID pandemic period. Compared to the prior year period, we believe our revenue was down for two primary reasons. The first is that 2021 results benefited from COVID-related restrictions that positively impacted player engagement and has since had a lesser impact on our results as those restrictions have been lifted. The second is that global inflation and potential economic slowdown concerns seem to be impacting user spend for certain users. This dynamic are certainly not specific to double down and we are continuing to see positive metrics in the context of these dynamics as payer conversion remains above 5% and average monthly revenue per payer increase almost 4% year over year. Given our flexible operating model, we also reduced operating expenses excluding a non-cash accrual charges to income in the second quarter by 20% from the prior year, partially due to a reduction in overall sales and marketing costs. Given the ATT IDFA deprecation situation, we spent less to acquire new iOS players while investing more in the acquisition of new Android mobile users. We also have begun investing more to acquire new players outside of North America as we can see it as an opportunity, especially for Double Down Casino. We believe that this trend away from advertising to Apple users is consistent with that of the overall mobile gaming industry, and we will continue to monitor the effectiveness of advertising spend with each of our marketing channels to ensure we are meeting or exceeding our internal targets. As we have discussed in the past, we maintain a disciplined approach to our marketing investments and will not ramp spending merely to grow users at the expense of shareholder value. The other factor reducing our operating expenses was our decision to moderate user acquisition investments for our first non-social casino app, Undead World Cure Survivor. As you may recall, we began scaling back marketing activity for Undead World in the first quarter of 2022 to enable us to test new monetization enhancement While we observed an improvement to monetization metrics with these enhancements, our analytics suggest the title is not yet where it needs to be. Accordingly, we plan to continue optimizing feature development in the app, and as a result, do not envision increasing marketing investment in Undead World this year. It is important to keep in mind that developing successful new games is not a riskless process, as not all titles can be game-changing hits. It is also important to note that we can develop these new titles within our existing financial model, which allow us to continue generating higher margins, positive cash flow, and release new games that have asymmetric risk-return profiles. Looking ahead, We continue to develop a robust pipeline of new titles outside of the social casino segment as we look to diversify our revenue and growth opportunities. We plan on launching new games in the future, which can be accomplished within our existing R&D budget, all while continuing to reinvest in our flagship Double Down Casino app to introduce new meta features and slot games. For example, we are continuing to work towards the open beta release of Spinning Space later this quarter, followed by a worldwide launch targeted in the first quarter of 2022. Spinning Space has both casino and non-casino elements and can therefore attract users within our existing social casino demographic and new users who prefer non-casino casual gaming. We also have several gaming apps under development by our internal studios planned for launch during 2023. Now I will turn it over to our CFO, Joe Sigrist, to walk you through our financials before providing my closing remarks. Joe.