Emerge Gaming records first profit as subscriber base hits 300,000
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Esports and online gaming company, Emerge Gaming (ASX:EM1), advised that it has banked another $4.5 million in cash receipts from its gaming platforms, Miggster and MTN Arena.
The announcement follows the $9 million it banked in January from its Miggster platform alone.
The two platforms now have a combined subscriber base of 300,000 users in 160 countries, accepting both Bitcoin and mobile billing payments.
The Miggster gaming platform was launched in November 2020, built upon Emerge’s game tournament platform technology.
To market the new platform, the company partnered with Spain’s Tecnología de Impacto Multiple (TIM). Within a matter of months, up to March this year, Miggster has amassed around 150,000 paying subscribers.
However, this has led to queries from the ASX, after it emerged that the first 12,000 invitations to Miggster were sent to a pre-selected group of CROWD1 affiliate members from select countries who had pre-registered with Miggster.
CROWD1 is an affiliate of TIM and has in the past been flagged by various government regulators for operating get-rich-quick schemes.
Emerge has since answered those queries satisfactorily, and its shares have been lifted from suspension by the ASX.
Emerge Gaming’s stated objective is to build the world’s biggest online gaming community.
CEO Greg Steven has said that he is targeting a “community size in the tens of millions of subscribers.”
To achieve this, the company is executing a two-pronged strategy: a B2C (business-to-consumer) market strategy, and expanding its B2B2C (business-to-business-to-customer) strategy internationally via partnerships with mobile network operators (MNO).
The B2C strategy seeks to launch its own product direct to consumer, whilst engaging the services of marketing and distribution specialists. It has employed a Cost per Acquisition model, which transfers the risk of any loss from marketing campaigns to its service provider and partners.
The B2B2C strategy, meanwhile, aims to partner with global MNOs to distribute its Social Gaming Tournament Platform internationally. In line with this strategy, Emerge launched its Social Gaming Tournament technology under the MTN Arena brand with MTN South Africa in July 2020.
It’s also currently in discussions with Microsoft to partner for the planned launch of the Game Cloud Streaming Product in 2021.
The company delivered its first ever profit in the half ending 31 December, on the back of Miggster subscriptions.
Half-year revenue came in at $1.36 million, which is double on the previous corresponding period (pcp).
This led to a bottom line profit of $0.5 million, which was an improvement from the $0.8 million loss it incurred on pcp.
The company’s share price has surged by over 300 per cent in on year, trading yesterday at 4.2c.