DoubleDown Interactive Co., Ltd.

Good afternoon and welcome to Double Down Interactive's earnings conference call for second quarter ending September 30th, 2023. My name is James and I will be your operator this afternoon. Prior to this call, Double Down issued its financial results for the third quarter 2023 in a press release, a copy which has been furnished in a report on a form 6K filed with the SEC and is available in the investor relations section at the website www.doubledown.com. DoubleDownInteractive.com. You can find the link in the investor relations section at the top of the homepage. Joining us on today's call, our Double Down CEO, Mr. Inko Kim, and its CFO, Mr. Joe Segrist. Following their remarks, we will be open for questions. Before we begin, Richard Land, the company's outside investor relations advisor, will make a brief introductory statement. Mr. Land.

Thank you, James. 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 meeting 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 the use of 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 20-F filed with the SEC on March 31, 2023, and other SEC filings for a more detailed discussion of the risks that could impact future operating results and financial condition. These forward-looking statements were made only as of the date of this call. The company does not undertake and expressly disclaims any obligations 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 our 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 in the investor relations section of Double Down's website. With that, it's my pleasure to turn the call over to Double Down's CEO, Inko Kim.

Thank you, Rach. Good afternoon, everyone. Thank you for joining us on our 2023 Third Quarter Earnings Call. Q3 revenue of $73 million was down slightly on a quarterly sequential basis from $75.2 million in Q2 2023. The decline to a significant extent reflects our continued focus on optimizing our advertising spend to deliver profitable revenue. As such, we continue to generate consistent profit and adjusted EBITDA in the third quarter. Adjusted EBITDA for the third quarter rose both year over year and on a quarterly sequential basis to $29.7 million, while cash flow from operations for the third quarter increased $6.5 million year over year to $28.7 million. Our flagship Double Down Casino, or DDC, continues to be the driver of our solid results. This includes contribution to operating cash flow of approximately $86 million through the first nine months of the year, including the final payment to the Benson Class Action Settlement earlier this year. DDC continues to be very sticky with its existing core paying players as evidenced by the increase we are achieving in average monthly revenue per payer, which have established the foundation for our consistent financial results, including attractive adjusted EBITDA margins and cash flow from operations. As many of you know, DDC revenue is primarily driven by those who have been playing our casino-style games for several years, as opposed to newly acquired players, with a majority of revenue in any quarter generated by players acquired in previous periods. As we have discussed, this is supported by our marketing span refinements and optimization as we focus on generating attractive and appropriate returns. Going forward, Our marketing investment in the social casino business will depend on our ability to intelligently forecast improvement in the ROI of the acquisition of new players and in the retention of existing payers. Simply said, we are managing the business for appropriate ROI on marketing spend to deliver the highest cash flows. We've previously discussed that the consistent cash flow generated by DDC provides us with the flexibility to allocate capital towards establishing a presence in new gaming categories that have highly addressable market opportunities and that are complementary to our core social casino business. In this regard, last week we completed the acquisition of SuperNation, which operates three real-money iGaming sites, primarily focused on online gambling in Western Europe. SuperNation has strong and loyal player base in markets such as Sweden and the UK, and we believe they are poised for growth. In fact, while SuperNation generated unaudited revenue of up-extremely, $24 million in 2022, it is estimated that the European online gambling market will reach $48 billion this year. So we do see a lot of opportunity before us with this transaction. We are working to quickly leverage Double Down's product development expertise to enhance the differentiated online casino player experience SuperNation offers on their Duos, NY Spin, and Voodoo Dream sites. We also expect to take advantage of Double Down's excellence in player acquisition and engagement and monetization. Let me provide a little color on SuperNation's recent progress and the opportunities we see to scale the business. For the first nine months of 2023, their revenue rose approximately 5% compared to the same period a year ago, and they continue to operate at essentially adjusted EBITDA break even. Earlier this year, the company obtained licenses to operate in Estonia, and we expect to launch in this market in the first half of 2024. Following the acquisition, we see opportunities to enhance the marketing efforts to accelerate growth, especially in SuperNation's largest current market of the UK and Sweden. At the same time, we will be fine-tuning SuperNation's operational processes, including with compliance tools, which will help position the business to handle a larger player base as they scale. All of us at Double Down are excited to welcome the SuperNation team to the company. And I'm personally looking forward to working closely with Joachim Stockmann and Henrik Andersen, the co-chief executive officers of SuperNation and their entire team to help bring the business to the next level. The iGaming sector is just one of several complementary gaming categories that are of interest to us. Additional high-growth gaming categories where we can leverage our core competencies include the very large casual mobile games category, which has games in the puzzle, casual casino, and skill, match, and adventure genres. We plan to support these apps in a capital, efficient manner to deliver appropriate returns. Now I will turn it over to our CFO, Joe Sigrist, to walk you through our financials before providing my closing remarks. Joe?