DoubleDown Interactive Co Ltd (DDI) has released its unaudited financial results for the third quarter of 2024, showcasing notable growth in revenue and EBITDA despite challenges in net income due to foreign currency translation losses and higher expenses following its acquisition of SuprNation.
Is now the time to buy DDI? Access our full analysis report here, it’s free.
Key Insights from DoubleDown Interactive’s Q3 Earnings Report:
For Q3 2024, DoubleDown reported a revenue increase of 14%, totaling $83.0 million compared to $73.0 million in Q3 2023. Excluding SuprNation’s contributions, core revenue rose by 3% to $75.2 million, driven by greater player engagement and monetization. Operating expenses also rose, reaching $47.7 million, largely due to SuprNation-related costs. Despite these expenses, DoubleDown achieved a 22% boost in adjusted EBITDA, reaching $36.1 million, with an impressive, adjusted EBITDA margin of 43.5%.
Net income saw a decline to $25.1 million from $26.9 million in Q3 2023, attributed mainly to currency losses and increased general and administrative costs associated with the new acquisition. The ARPDAU for DoubleDown’s social casino games reached $1.30, up from $1.06 a year earlier, while average monthly revenue per payer grew to $281 from $245. These figures underscore the company’s adept monetization strategy and robust player retention.
Management Discussion and Analysis:
DoubleDown CEO In Keuk Kim highlighted Q3 2024 as a “strong performance” quarter, emphasizing the company’s continuous growth in its social casino revenue, marking a fourth consecutive quarter of year-over-year growth. The company’s strategic focus on user acquisition efficiency and disciplined R&D spending has supported consistent free cash flow and profitability. For SuprNation, DoubleDown noted higher revenue contributions this quarter than pre-acquisition levels, crediting optimized player engagement and market strategies.
In addition to a disciplined cost structure, DoubleDown reported a substantial net cash position of approximately $335 million, which CEO Kim described as a foundation for potential organic and M&A growth. The management’s ongoing evaluation of market opportunities reflects their commitment to maximizing shareholder value.
Stock Target Advisor’s Analysis on DoubleDown Interactive Co Ltd:
According to Stock Target Advisor, DoubleDown Interactive maintains a “Slightly Bullish” rating, with an average target price of USD 21.06 over the next 12 months. The stock is well-regarded for its low volatility, attractive price-to-earnings ratio, and strong returns on equity and assets. Additionally, its consistent positive cash flow reinforces its financial stability.
However, Stock Target Advisor also notes some cautionary elements: while DoubleDown’s stock is underpriced compared to its peers, it is trading high relative to cash flow metrics. Furthermore, the company’s revenue growth over the past five years has lagged sector benchmarks. Analysts provide a mixed outlook, with Northland Capital and Wedbush Securities noting “Outperform” ratings and B. Riley Financial rating it a “Buy”.
Conclusion:
DoubleDown Interactive’s Q3 2024 results reflect strong operational growth and strategic alignment post-SuprNation acquisition. With robust revenue generation, disciplined spending, and a solid cash position, DoubleDown remains well-positioned for growth opportunities in the social casino and iGaming sectors.
Muzzammil is a content writer at Stock Target Advisor. He has been writing stock news and analysis at Stock Target Advisor since 2023 and has worked in the financial domain in various roles since 2020. He has previously worked on an equity research firm that analyzed companies listed on the stock markets in the U.S. and Canada and performed fundamental and qualitative analyses of management strength, business strategy, and product/services forecast as indicated by major brokers covering the stock.
