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Why Esports Entertainment Group, Inc. (GMBL) stock soared in the aftermarket?

Esports Entertainment Group, Inc. (GMBL) stock soared in the aftermarket following the announcement of the fourth quarter and fiscal year 2021 financial results. GMBL stock price saw a surge of 17.98% to reach $7.81 in the aftermarket. The stock was green in the previous trade and went up by 2.48% at closing. Let’s dig in to explore more about this stock.

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Esports Entertainment Group, Inc, founded in 2008, is operating as an online gambling company in Canada. The stock provides esports wagering, esports entertainment, and iGaming, and traditional sports betting services. Furthermore, it also organizes professional and esports events.

Fourth Quarter 2021 Financial Results:

  • GMBL stock generated $8.8 million in net revenue in the fourth quarter of 2021 ended June 30, 2021. The revenue was $8.8 million and 63% higher than revenue of the Q4,2020 and Q3,2021 respectively.
  • Gross profit of $5.2 million represents an increase of $5.2 million and 69% as compared to gross profit of Q4,2020 and Q3,2021.
  • The company spent $5.1 million in sales and marketing expenses and $10.5 million in general and administrative expenses in the reported quarter. Sales and marketing expenses were $0.3 million high as compared to Q4,2020 and general and administrative expenses were $1.8 million high as compared to Q4,2021.
  • GMBL stock suffered $10.5 million in operating loss as compared to a $2.1 million loss in the same prior-year period.
  • The stock reported a GAAP net loss of $4.8 million in the reported quarter, up from a net gain of $1.9 million in Q4,2020.
  • Non-GAAP adjusted EBITDA was $5.5 million Q4,2021 while this was $0.9 in the same tenure of the previous year.

Full-year fiscal 2021 financial results of GMBL stock:

  • GMBL stock reported $16.8 million net revenue in the fiscal year 2021, 100% higher than the fiscal year 2020.
  • Gross profit reached $8.9 million, higher than $8.9 million over the fiscal year 2020.
  • Sales and marketing expenses increased by $9.7 million from FY20 to reach $10.0 million in FY21.
  • GMBL stock spent $24.6 million in general and administrative expenses, $3.7 million higher than FY2020.
  • Operating loss for the Esports stock was $25.7 million for the fiscal year 2021, a $21.7 million high as compared to FY20.
  • GAAP net loss for the reported quarter reached $26.4 million, compared to a $10.4 million net loss in FY20. Non-GAAP adjusted EBITDA was $14 million for the reported year.

Financial Outlook of GMBL stock for fiscal 2022:

GMBL stock has projected its net revenue to be between $100 million to $105 million for the fiscal year 2022. This represents an extraordinary increase of 490% mainly due to multiple acquisitions completed in 2021. This means that company is optimistic about its progress in the upcoming years and hence can be a good bet for investors in the long run.

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