Reduced spending helps Allied cut net loss in 2023

Allied Gaming and Entertainment, a prominent player in the esports and poker sectors, achieved a remarkable reduction in its net loss by over 50% during the 2023 financial year, primarily through strategic cost management and operational improvements.

For the year ending December 31, 2023, Allied reported a revenue increase of 15.6%, totaling $7.4 million (£5.9 million/€6.9 million). This revenue boost, alongside significant cost reductions, contributed to a substantial decrease in net loss.

Allied operates through three primary divisions: Allied Esports International (AEI), Allied Mobile Entertainment (AME), and Allied Experiential Entertainment (AEE), with a dedicated emphasis on the burgeoning esports market.

The company boasts a variety of global assets, hosts live esports events, and provides production services in the industry. Among its most notable venues is the HyperX Esports Arena in Las Vegas, complemented by its mobile gaming arenas, the Allied Esports Trucks – innovative 18-wheel mobile gaming facilities.

CEO Yinghua Chen praised the “substantial” advancements achieved by Allied throughout 2023, highlighting the strategic acquisition of a majority stake in mobile games developer Beijing Lianzhong Zhihe Technology, finalized in August.

Chen elaborated on the strategic positioning for future expansion, stating, “We made substantial progress during fiscal year 2023 and have entered fiscal year 2024 in a position of strength. AEI, AME, and AEE are all primed for growth as we execute our strategic objectives this year.”

Furthermore, with the integration of Beijing Lianzhong Zhihe Technology into its operations, AEE is set to finalize events and extend its footprint within the Asian market. The company also anticipates ongoing demand for AEI’s properties and content, enhancing their optimism for the upcoming year.

Allied Reports a Net Loss of $3.6 Million

Examining the specifics of Allied’s 2023 financial results reveals that in-person activities remained the primary revenue driver, contributing $5.0 million—consistent with the prior year’s figures.

Growth in revenue stemmed significantly from Allied’s diverse operations. Notably, multiplatform content revenue surged by 42.9% to $2.0 million, while the introduction of casual mobile gaming generated $698,522—an area that did not contribute to the previous year’s totals.

On the expenditure side, the company successfully reduced total costs and expenses by 21.0%, landing at $14.3 million. This notable decrease was largely attributed to a 29.6% reduction in general and administrative expenses, which clocked in at $7.6 million.

The overall operational loss improved to $6.6 million, a significant decrease from the $11.8 million loss reported in 2022. The bottom line benefited from other income streams, resulting in a net loss of $3.6 million, in contrast to the $10.8 million loss incurred the previous year.

Additionally, adjusted EBITDA loss saw an improvement from $8.6 million in 2022 to $4.6 million, signifying a strengthened operational framework.

A Robust Conclusion to 2023

Allied’s full-year growth was bolstered by a strong fourth quarter, with Q4 revenues soaring by 75.0% to reach $2.1 million. This surge can be directly attributed to the acquisition of Beijing Lianzhong Zhihe Technology, which contributed an additional $698,522 in casual mobile gaming revenue.

Though total costs and expenses in Q4 slightly increased year-on-year to $4.0 million, the revenue escalation led to a reduction in operating loss from $2.7 million to $1.9 million.

Other income was reported at $30,730, along with interest income of $792,103, culminating in a net loss of $1.1 million for the quarter—an encouraging improvement from the $1.7 million loss recorded in 2022.

Finally, Allied’s adjusted EBITDA loss also narrowed, declining from $1.7 million the previous year to $1.2 million, underscoring the company’s path toward financial stabilization and growth in the competitive gambling landscape.