Super League Enterprise, Inc.

Greetings, and welcome to the SuperLeague Enterprising Q4 2024 earnings call. At this time, all participants are in listen-only mode. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to your host, CEO, Anne Hand. Please go ahead.

Good morning, everyone. You have us bright and early here on the West Coast. I want to start by saying that I'm excited about this call. I'm excited because you have a Super League team in front of you that is fired up. We have worked hard to build something of value and are committed to this objective. While we face some challenges, some that all microcaps have faced, some unique to our nascent industry, we are bullish on the opportunity to optimize our business model and deliver meaningful shareholder value. And today allows us the opportunity to provide all of you with updates on important aspects of our strategy, operating model, and leadership. So I'll dive in. As I just mentioned, the micro cap and micro economic headwinds along with some structural shifts in the Roblox ad ecosystem have challenged us, but it has not broken us and we have responded. And this provides a lot of opportunity for our stock going forward as we have adapted. We have and are being assertive and fast. We have grit, resilience, and our confidence is supported by an actionable plan already underway. While we've achieved plenty of success across hundreds of campaigns with blue chip brands, creating innovative technology and growing our audience base, our financial results in the back half of 2024 did not live up to the results we expected. We need to do better. Perhaps a speed bump on our path to profitability, but as well, it serves as a call for a sea change. And again, I want to reiterate that, a sea change. We believe in our long-term prospects, and there are positive signs in Q1. Notably, that revenue diversification is kicking in, margins are recovering, and our pipeline is healthy. We currently have about 20 million in active pursuits across 77 unique programs, and we've brought in higher margin products into our portfolio that can further grow average deal size and margin profiles. The key challenge remains that we are still in the market education phase on ways brands can target elusive gaming audiences through innovative, playable advertising. As you've heard me say before, traditional social media went through the same adoption curve, and over time it became a ubiquitous part of any marketer's strategy. The same lies ahead for us with our gaming marketing channels and audiences. So what is our mandate? It's getting to break even. That's job number one for you, our shareholders. Today, we are making it clear that we are aggressively attacking our cost structure to align with that imperative with an aim to be EBITDA positive in Q4, as well as focusing on larger revenue, higher margin programs to be more selective in where we focus our limited resources. We understand the trade-offs and we know what we need to do. In addition, as part of the realignment, I'm moving to executive chair through the end of the year and I'm passing the torch to Matt Edelman to be our new CEO. I will continue to support and mentor Matt through the transformation process and strategic alternatives exploration. Matt has been our fearless president for the last two years and has the intellect, the deep product and industry knowledge, work ethic, energy, and enthusiasm to hit the ground running. Take a look at his LinkedIn and you'll see he is a business builder at the intersection of innovative digital content and technology for more than 20 years, with notable experience at WME IMG Endeavor and Marvel, just to name a couple. As well, in an effort to bolster our board, we're thrilled to appoint Bant Breen as a director. Bant is a noted marketing and media executive, entrepreneur and academic. Specifically, Ban has spent a vast amount of his career in holding company and operating leadership roles with some of the largest global ad agencies, including Publicis, Dentsu, and IPG. And he was inducted into the Advertising Hall of Achievement in 2010. When you think about our market adoption challenge that we face, someone is connected and trusted at the executive level as Ban can open big doors for us, doors with agencies and brands and be a game changer for our pipeline and ultimately our revenue trajectory. As for the opportunity we announced with Infinite Reality back in October, the deal, as you know, has not completed. With the exclusivity period expired, it has allowed us to advance some very exciting alternative opportunities that are very on strategy for Super League. These few pursuits have significant overlap with us for more material revenue and cost synergies, And these are companies that are close to breakeven or already profitable, offering a combined P&L that accelerates our path to EBITDA positive, along with providing us with a more dominant position in the playable digital advertising space. To support this process, we have been able to shore up some short-term capital to provide us the runway for these advancing strategic conversations and complete our cost restructuring. And now I'm excited to have Matt join. We're going to do a little bit of a Q&A so you can hear directly from our new CEO. Okay, Matt, welcome.

Thank you. Thank you.