In This Article:
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Total Revenue: $2.3 billion for 2024, an increase of 18.8%.
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Fourth Quarter Revenue: $649.1 million, up 29.1%.
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Melissa & Doug Revenue: $374.7 million for 2024.
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Adjusted EBITDA: $463.6 million for 2024, with a margin of 20.5%.
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Digital Games Revenue: $164.5 million for 2024, a decline of $9.4 million.
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Free Cash Flow: $215 million for 2024.
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Net Debt to Adjusted EBITDA Ratio: 0.7 times at the end of 2024.
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Inventory: $184.7 million at the end of 2024.
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Gross Margin: 55.6% adjusted for inventory fair value adjustment.
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Effective Tax Rate: 24.4% excluding onetime expense.
Release Date: February 25, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Spin Master Corp (SNMSF) achieved total revenue of $2.3 billion in 2024, marking an 18.8% increase, with significant contributions from Melissa & Doug.
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The company reported a strong fourth-quarter revenue of $649.1 million, up 29.1%, driven by toys and video games.
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Digital Games revenue increased by 13.5% in Q4 due to high in-game purchases and subscription growth.
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Spin Master Corp (SNMSF) ended Q4 with 61.2 million monthly active users, up from 50.5 million at the end of Q3.
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The company generated $175 million in free cash flow in Q4, significantly higher than the previous year, and returned $82 million to shareholders in 2024.
Negative Points
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PAW Patrol POS declined in both Q4 and 2024, although it remained the top preschool toy property globally.
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Entertainment revenue decreased by $13.9 million in Q4 and $31 million for 2024 due to fewer content deliveries.
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The company faced challenges in Digital Games earlier in the year, resulting in a revenue decline of over $9 million for 2024.
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Spin Master Corp (SNMSF) made the decision to wind down the Nrdlight studio and halt Rubik's Match development due to underperformance.
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The company is cautious about potential US tariffs on China-sourced toys, which could impact future financial performance.
Q & A Highlights
Q: Can you provide insights into the recent investment initiatives in Digital Games, particularly regarding paid user acquisition at Toca Boca and retention strategies at Piknik? Why were new features not implemented earlier in 2024? A: Max Rangel, Global President and CEO, explained that strategic investments in technology and live operations began in the summer of 2024, which improved feature development and player engagement. These initiatives, along with targeted paid user acquisition, are expected to drive better monetization and performance in 2025. The focus is now on core offerings like Toca Boca and Piknik, as they present significant growth opportunities.