Allied Esports Entertainment announced Monday its financial results for the third quarter ended September 30, 2021, and reported total revenues of $1.7 million representing a 182% increase in a year-over-year comparison.
This growth was driven by the increased foot traffic at the company’s HyperX Esports Arena Las Vegas due to the increased number of events and loosened restrictions of operating hours and social distancing measures, as well as continued encouraging results from the company’s push into its multiplatform content pillar of the business.
Net income for the quarter was $74.3 million compared to a net loss of $6.5 million in the prior year period. The liquidity improvement was primarily driven by the gain on the sale of the World Poker Tour (WPT) in July. Adjusted EBITDA loss was $3 million, compared to a loss of $2.4 million in Q3 2020.
Total costs and expenses for the third quarter of 2021 were $5.6 million, an increase of 27%, year-over-year.
In an official press release, Allied Esports’ CEO Libing (Claire) Wu commented on this past quarter’s numbers and said: "The third quarter was a very productive period for AESE highlighted by a strong quarter of growth from our Esports business. During the quarter, total revenues more than doubled from the prior quarter and increased over 182% compared to the third quarter last year. This growth was driven by a sharp recovery of the In-person pillar of our Esports business with the U.S. economy almost fully re-opened, coupled with a steady climb in Las Vegas foot traffic and the return of live entertainment events.
“That said, game publishers, who were our largest customers prior to the pandemic, have not yet resumed In-person events and could provide an additional boost to our In-person pillar when they resume normal activities. During the third quarter we also generated solid revenue contributions from our Multiplatform Content pillar and we continue to make strides towards monetizing our growing content library with key streaming partners as well as building out our production services capabilities through AE Studios”, Wu pointed out.
"Importantly, during the quarter, we significantly improved our liquidity position with the sale of WPT to Element Partners in an all-cash transaction for $105 million. Since the completion of the WPT transaction this summer, we have made good headway in evaluating opportunities to invest our cash and exploring strategic alternatives for our Esports business as we look to maximize value for AESE shareholders”, she concluded.
During this past quarter, Allied Esports produced 110 events, including 39 proprietary ones and 71 third-party and in-person productions. Total events rose 31% compared to the prior quarter. A strong growth came from both its in-arena and its online proprietary offerings with a 24% increase in total players competing in both formats.
Third party events company-wide were up 51% quarter over quarter, driven by an 89% increase in third party events and productions booked at the HyperX Esports Arena Las Vegas. In addition, AE Studios, the company's new original content, storytelling and production services arm, produced a number of events including the CelebriTee Showdown for Twitch.
The Multiplatform Content pillar also performed well, with the company’s 24-hour content strategy on Twitch, generating 3.2 million live views during the third quarter, while also increasing total followers by 24%.
During this past quarter, the company also announced the completion of the sale of its subsidiaries comprising the World Poker Tour to Element Partners for a purchase price of $105 million, among other on-going operations.
Subsequent to quarter end, on October 11, 2021, the company announced the appointment of Roy Anderson as the Company’s Chief Financial Officer, effective immediately, following the resignation of Anthony Hung.
On November 11, the Board of Directors appointed current directors into new roles to accelerate the progress in identifying and consummating the acquisition of one or more companies and concluding a possible sale of the company’s esports business. The Board of Directors appointed Lyle Berman as President, Yinghua Chen as Chief Investment Officer and Adam Pliska as a special consultant.
On November 11, 2021, the Board of Directors appointed Guanzhou (Jerry) Qin to the Board of Directors as a Class B Director to fill the vacancy created by Misch’s resignation.
The Board of Directors elected Yanyang Li, a current director of the Company, to serve as co-Chairman of the Board of Directors with the existing chairman, Lyle Berman.