Allied Esports Entertainment announced financial results for the third quarter, ending on September 30th, 2021. Total revenues of $1.7 million increased 182% when compared to the third quarter of 2020. This was driven by the increased foot traffic at the organization’s world-famous HyperX Esports Arena Las Vegas due to the increased number of events and loosened restrictions of operating hours and social distancing measures. Meanwhile, net income for the quarter was $74.3 million compared to a net loss of $6.5 million in the prior-year period. The improvement was primarily driven by the gain on the sale of World Poker Tour.
“The third quarter was a very productive period for AESE highlighted by a strong quarter of growth from our Esports business,” said Libing (Claire) Wu, CEO of Allied Esports. “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.”
The company has accelerated its plans to explore strategic options for the esports industry, including a possible sale of the business. Allied Esports has made substantial progress in identifying a path forward for the esports business that maximizes value for AESE shareholders. To this end, they have entered into a non-binding Letter of Intent with a third party to sell its esports business. The company is not in a position to announce further details at this time but will provide updates in due course.
In addition, the organization is continuing to identify opportunities to invest the cash on its balance sheet, along with any cash from the potential sale of the esports business, to acquire or merge with an existing business. To date, the company has reviewed a number of potential targets and the continued sourcing of additional opportunities is ongoing. The company’s key criteria for a potential target business include a proven business model with an experienced management team and a documented use of the company’s cash. The company has been in contact with a number of investment banks to assist in the process and expects to officially engage a firm in the near future.
(All information was provided by Business Wire)
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