PlayStudios’ third quarter was marked by continued revenue and user declines, a trend that management attributed to persistent category headwinds and the impact of recent cost-reduction efforts. CEO Andrew Pascal described the operating environment as “extremely challenging,” citing a shift in focus from content development to efficiency, which contributed to a further softening in the portfolio. Notably, Pascal acknowledged, “Our valuation today sits only slightly above our cash position, and we know some investors are questioning our direction,” signaling a cautious and self-critical tone throughout the call.
Is now the time to buy MYPS? Find out in our full research report (it’s free for active Edge members).
PlayStudios (MYPS) Q3 CY2025 Highlights:
- Revenue: $57.65 million vs analyst estimates of $59.45 million (19.1% year-on-year decline, 3% miss)
- Adjusted EPS: -$0.01 vs analyst estimates of $0.01 ($0.03 miss)
- Adjusted EBITDA: $7.25 million vs analyst estimates of $10.06 million (12.6% margin, 28% miss)
- Operating Margin: -13.6%, down from -6.7% in the same quarter last year
- Daily Active Users: 2.21 million, down 750,000 year on year
- Market Capitalization: $100.9 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From PlayStudios’s Q3 Earnings Call
- Ryan Sigdahl (Craig-Hallum) asked about feedback from sweepstakes users and the broader rollout plan. CEO Andrew Pascal confirmed positive early data and intends to expand Win Zone to all available states before ramping up marketing investment.
- Sigdahl (Craig-Hallum) also probed for potential benefits to core games from recent regulatory bans in California. Pascal responded that any impact will be monitored once the ban takes effect, with targeted marketing planned.
- Sigdahl (Craig-Hallum) questioned the balance between organic improvements and M&A for growth. Pascal emphasized that both are being considered, but no deals are imminent.
- Aaron Lee (Macquarie) inquired about visibility into 2026 and guidance for sweepstakes contributions. Pascal stated that predictability should improve by year-end after broader launches and go-to-market tests.
- Michael Hickey (Benchmark) asked whether the core business would see further sequential revenue decline. CFO Scott Peterson affirmed that Q4 revenue from the core is expected to decrease, given current trends.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will track (1) the full-scale rollout and monetization of Win Zone across all eligible states, (2) user acquisition and engagement trends for Tetris Block Party as it moves beyond beta, and (3) stabilization in the core social casino business, particularly in response to regulatory shifts in key states like California. Progress on direct-to-consumer channels and early signs of margin improvement will also be important indicators.
PlayStudios currently trades at $0.76, down from $0.90 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free for active Edge members).
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