DoubleDown Interactive Co., Ltd.

Given the consistency of the cash flow Dobudan Casino delivers, we believe we have significant flexibility to allocate capital towards establishing a presence in new gaming categories with highly addressable market opportunities. The new gaming categories that are of interest to us are ones that would be complementary to our core social casino operations. where we can leverage our game developers' expertise in game creation and our marketing platform to scale those businesses profitably. One example of our focus on expanding our addressable market is our pending acquisition of SuperNation, which operates three real-money iGaming sites in Western Europe. We continue to make progress towards gaining the required regulatory approvals to complete this transaction and now expect to close the position by the end of the year. We believe the position of SuperNation will diversify our revenue sources as it will mark our entry into the high-growth high-gaming sector. We are excited to be moving closer to completing this transaction, and once we do, We will provide additional information for you on our plan to drive growth in this business and build from there. iGaming is just one game category adjacent to our core social casino business that we are evaluating for opportunity to leverage our expertise in player engagement and monetization with our game development expertise to drive growth. We continue to invest in our own app development initiatives outside of the social casino category to address the very large casual mobile game category, including four games in the Action, Casual Casino, Match, and Adventure genres. Over the balance of the year, we expect to introduce new gaming apps outside of the social casino category and will support them in a capital-efficient manner to deliver appropriate returns. Now I turn it over to our CFO, Joe Sigris, to walk us through our financials before providing my closing remarks.

Joe? Thank you, Ike, and good afternoon, everyone. Our revenues for the second quarter of 2023 were $75.2 million compared to $80.6 million for Q2 2022. As IK mentioned, Q2 revenue was down 3% sequentially from the first quarter of 2023, primarily reflecting the seasonality in the business. Several KPI metrics improved compared to the year-ago period, including average revenue per daily active user, or ARPDAU, increased to $1.05 in Q2 2023 from $0.95 in Q2 2022. Payer conversion ratio which is the percentage of players who pay Double Down, was up 80 basis points to 6.0% in Q2 2023 compared to 5.2% in Q2 2022. Average monthly revenue per payer increased 4% from $226 in Q2 2022 to $235 in Q2 2023. On a quarterly sequential basis, Total operating expenses decreased from $52.2 million in the first quarter of 2023 to $47.7 million in the second quarter of 2023. The decrease was primarily due to lower cost of revenue and lower sales and marketing depreciation expenses. Sales and marketing expenses for the second quarter of 2023 were $13.1 million. a decline of 27% compared to Q2 2022, and 18% lower on a quarterly sequential basis. We believe that our advertising efforts to acquire new and retain existing players, the primary cost in the sales and marketing category will continue to be in this Q2 range over the next several quarters. But as IK indicated, we will continue to evaluate such spend with a focus on delivering the best return of these investments, including with the launch of new gaming apps. It is also worth noting that depreciation and amortization expense has been consistently staying below $100,000 for the last four quarters, a significant decline from prior periods due to the completed amortization of certain identifiable intangible assets for which we used purchase price allocation at the time of the 2017 Double Down Interactive Acquisition. Net income for the second quarter of 2023 was $24.4 million, or $9.83 per diluted share and 49 cents per ADS, compared to a net loss of $34.1 million, or $13.75 per diluted share and 69 cents per ADS, in the second quarter of 2022, which at the time included the impact of a non-cash accrual of $71.5 million related to legal proceedings for the Benson class action complaint. Adjusted EBITDA for the second quarter of 2023 was $27.6 million compared to $25.0 million for the prior year quarter. Accordingly, adjusted EBITDA margin rose to 36.7% for Q2 2023, representing an improvement from 31.0% in Q2 2022 and 32.8% in Q1 2023. Net cash flows used for operations were $56.8 million for the second quarter of 2023, which primarily reflects the payment of $95.3 million towards the litigation settlement. This was our final payment for this matter, and excluding this payment, net cash flows from operations was $38.4 million, almost double the net cash flows from operations in the prior year period. Finally, turning to our balance sheet, as of June 30th, 2023, we had a total of $245.1 million in cash and cash equivalents and short-term investments. Our total debt as of the 30th of June was $38.1 million. With regard to our current cash position, with the final payment for the Benson settlement now behind us and excluding cash for closing of our pending Supernation acquisition and payment for our debt, our balance sheet currently reflects a total uncommitted cash and cash equivalents and short-term investment position of well over $150 million or over $3 per ADS. This completes my financial summary now. I'll turn it over to IK for closing remarks.

Thank you, Joe. We believe the financial power of our social casino platform, including attractive adjusted EBITDA margins and strong cash flow, positions us to continue investing in multiple areas of potential growth through both organic development and M&A. For our core social casino business, we are focused on driving order and consistent player entertainment value and engagement, which drives higher monetization. Our development team continues to make enhancements to our flagship app, Double Down Casino. This development focus includes additional slot game launches as well as the introduction of new monetizing features such as jackpot and in-game activities. As I highlighted earlier, we are making progress towards completing our acquisition of SuperNation following which we plan to work to ramp up the business in the high-growth iGaming market. At the same time, we are continuing to evaluate other M&A opportunities that would leverage our existing strengths in game development, engineering, marketing, and business intelligence to enter new gaming categories in order to further grow our top and bottom line. As Joe highlighted, we have a very strong uncommitted cash position and have continued to generate consistent high levels of free cash flow. We are confident to believe that these positions double down to act on opportunities that will create new value for our shareholders. We are now happy to take your questions. Operator?