Motorsport Games (NASDAQ:MSGM) Issues Earnings Results

Motorsport Games (NASDAQ:MSGM) announced its quarterly earnings results on Thursday. The company reported $0.19 EPS for the quarter, beating analysts’ consensus estimates of $0.08 by $0.11, FiscalAI reports. Motorsport Games had a net margin of 16.15% and a return on equity of 41.13%. The firm had revenue of $3.78 million during the quarter, compared to analysts’ expectations of $3.79 million.

Here are the key takeaways from Motorsport Games’ conference call:

• Third-quarter revenue rose 21.8% year over year to $3.8 million, gross margin increased to 88%, and adjusted EBITDA grew 75.7% to $1.8 million. Motorsport Games reported its seventh consecutive profitable quarter.
• RaceControl subscription revenue increased 186% to about $2 million for the first nine months, with more than 45,000 paid subscribers and October annualized recurring revenue of about $3.4 million. The company brought its portal fully in-house, which management said will also end a 10% revenue share with its former technology partner.
• Le Mans Ultimate surpassed 2 million sales across game copies and downloadable content; its first American content pack set a record for launch-day DLC sales. A playable console version is ready ahead of schedule, with a release planned for 2027.
• Operating cash flow reached $4.1 million for the first nine months, and the company ended September with $5.4 million in cash and $4.2 million in working capital. Management said the stronger balance sheet gives it room to invest for growth.
• Management acknowledged the business remains largely driven by one title and provided no forward guidance. Plans to diversify through new products and partnerships are underway, but specifics and signed agreements have not yet been announced.

Motorsport Games Stock Performance

MSGM stock traded down $0.07 during mid-day trading on Thursday, hitting $4.28. 65,120 shares of the company were exchanged, compared to its average volume of 78,940. Motorsport Games has a 1-year low of $2.46 and a 1-year high of $5.65. The stock has a market capitalization of $17.86 million, a PE ratio of 9.95, a price-to-earnings-growth ratio of 0.58 and a beta of 2.03. The business has a 50 day simple moving average of $4.73 and a 200-day simple moving average of $4.30. The company has a current ratio of 1.85, a quick ratio of 1.85 and a debt-to-equity ratio of 0.23.

Analyst Upgrades and Downgrades

Several research analysts have recently weighed in on MSGM shares. Zacks Research lowered shares of Motorsport Games from a “strong-buy” rating to a “hold” rating in a research note on Monday, October 19th. Weiss Ratings upgraded shares of Motorsport Games from a “hold (c)” rating to a “hold (c+)” rating in a research note on Friday, September 11th. Finally, Wall Street Zen upgraded shares of Motorsport Games to a “buy” rating in a research note on Saturday, September 26th. Two equities research analysts have rated the stock with a Hold rating. According to data from MarketBeat, the stock has an average rating of “Hold”.

Insider Activity at Motorsport Games

In other news, major shareholder Red Oak Partners, Llc bought 23,143 shares of the firm’s stock in a transaction dated Thursday, August 20th. The shares were bought at an average price of $3.86 per share, with a total value of $89,331.98. Following the completion of the transaction, the insider owned 333,410 shares of the company’s stock, valued at $1,286,962.60. This trade represents a 7.46% increase in their ownership of the stock. The purchase was disclosed in a filing with the SEC, which is accessible through the SEC website. Insiders purchased a total of 72,779 shares of company stock valued at $283,660 over the last 90 days. 4.59% of the stock is currently owned by corporate insiders.

About Motorsport Games

Motorsport Games Inc. (NASDAQ: MSGM) is a video game developer and publisher focused on racing and motorsport entertainment. The company creates and distributes racing games for consoles and personal computers, and supports related online, competitive and esports experiences. Its portfolio has included officially licensed motorsport titles and racing technology platforms. Motorsport Games has been associated with products such as Le Mans Ultimate , the official game of the FIA World Endurance Championship, and rFactor 2 , a racing simulation platform developed by its Studio 397 business.