Evolution released its 2022 Q3 earnings. Here are the key points that you don't want to miss for Evolution from this earnings!
In 2022 Q3, Evolution continued to perform well with no unexpected material surprises, with its revenue growing by 37% y/y, and net profit growing by 41% y/y, and with it continuing to launch new studios and games globally with strong worldwide demand.
Let’s look at some key financials for Evolution for the quarter, followed by comments on its capital allocation and overall business.
In 2022 Q3:
Revenue grew by 37% y/y to EUR 379m, with the Live segment growing faster at 45% (to EUR 310m). These growth were faster than the y/y growth a quarter ago – 34% for total revenue and 37% for Live. The RNG segment grew by 11% y/y, or by only 2% y/y after adjusting for Nolimit City (which was acquired recently in Q3). The management was not satisfied as they had delivered too few slot games in the quarter, but remained fully committed to the target of double digit growth (excluding Nolimit City). In addition, the management continued to see great potential in One-Stop Shop (OSS) to cross-sell all its games, and would focus on accelerating rollouts.
Operating expenses grew at a similar pace, at 37% (to EUR 142m), driven mainly by higher personnel costs (+48%, as its employee base increased by 30%), and with Evolution seeing more cost inflation than earlier expected (including on wages).
EBITDA grew by 35% y/y to EUR 261m, with an EBITDA margin of 69.0%, down from both the 69.9% a year ago or the 69.3% a quarter ago, due to the higher than expected costs. This 69% margin is within the previously guided EBITDA margin range of 69%-71%, and management still expects to achieve that range for full year 2022 (with the 2022 9M margin currently at 69.5%). As with the past, the management reiterated that “if there is a tradeoff between growth and margin, we will always prioritize growth and market share.”
For the remaining points of this article, check them out at our Multibagger Research Series (linked below).
For our free analysis of other high quality companies, check them out at our free Research Series (linked below).
For Evolution Q3 Earnings and Future Growth of the company, check out the link below.
Subscribe here if you want to be notified of future posts!
P.S. Do join our investment forum on Facebook too where we discuss interesting investment concepts and ideas. If you have enjoyed this article, you will enjoy our other articles here.
Comments