Motorsport Games (NASDAQ:MSGM) Announces Quarterly Earnings Results, Beats Expectations By $0.17 EPS

Motorsport Games (NASDAQ:MSGM) announced its earnings results on Friday. The company reported $0.19 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.02 by $0.17, FiscalAI reports. Motorsport Games had a net margin of 45.70% and a return on equity of 87.43%.

Here are the key takeaways from Motorsport Games’ conference call:

• First-half revenue rose 74% year over year to $7.6 million, while gross margin expanded to 84.7% from 78.8%; the company also reported its sixth consecutive quarter of positive GAAP net income.
• RaceControl continued its rapid growth, with first-half subscription revenue increasing nearly 349% to approximately $1.4 million, annual recurring revenue reaching $2.9 million, and paid subscribers exceeding 40,500.
• Le Mans Ultimate surpassed 500,000 base-game sales and 1.2 million DLC sales, with player engagement accelerating; the US Track Pass featuring Daytona and Laguna Seca reportedly launched above management’s expectations.
• Development of PlayStation and Xbox versions of Le Mans Ultimate remains on plan, but management emphasized that bringing the high-fidelity simulation to consoles is complex and did not provide a launch date.
• Cash was $3.9 million at quarter-end after the company spent $3.7 million repurchasing Class A shares and had drawn $1.2 million of a $3 million revolving credit facility, limiting near-term financial flexibility despite positive operating cash flow.

Motorsport Games Price Performance

Shares of NASDAQ:MSGM traded down $0.04 on Friday, reaching $4.44. 93,675 shares of the company traded hands, compared to its average volume of 37,088. The stock has a market capitalization of $18.51 million, a PE ratio of 3.79, a P/E/G ratio of 0.78 and a beta of 1.71. The company’s 50 day moving average is $4.30 and its 200-day moving average is $4.17. Motorsport Games has a fifty-two week low of $2.11 and a fifty-two week high of $5.56.

Insider Activity

In related news, major shareholder Red Oak Partners, Llc bought 27,744 shares of the business’s stock in a transaction dated Tuesday, June 30th. The shares were bought at an average cost of $3.95 per share, with a total value of $109,588.80. Following the completion of the transaction, the insider directly owned 285,611 shares of the company’s stock, valued at approximately $1,128,163.45. This trade represents a 10.76% increase in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this link. In the last 90 days, insiders acquired 43,681 shares of company stock valued at $175,344. Insiders own 4.59% of the company’s stock.

Hedge Funds Weigh In On Motorsport Games

Institutional investors have recently bought and sold shares of the stock. XTX Topco Ltd acquired a new stake in Motorsport Games during the 4th quarter worth about $34,000. HRT Financial LP acquired a new position in shares of Motorsport Games in the fourth quarter worth about $37,000. State Street Corp purchased a new position in shares of Motorsport Games in the fourth quarter worth approximately $39,000. Finally, Dimensional Fund Advisors LP purchased a new position in shares of Motorsport Games in the third quarter worth approximately $46,000. Hedge funds and other institutional investors own 1.66% of the company’s stock.

Analyst Upgrades and Downgrades

MSGM has been the subject of a number of research analyst reports. Wall Street Zen lowered shares of Motorsport Games from a “strong-buy” rating to a “buy” rating in a research note on Sunday, June 7th. Weiss Ratings raised Motorsport Games from a “sell (d+)” rating to a “hold (c-)” rating in a research note on Friday, July 10th. Finally, Zacks Research upgraded Motorsport Games to a “hold” rating in a research report on Wednesday, July 1st. Two investment analysts have rated the stock with a Hold rating, According to MarketBeat, the stock has an average rating of “Hold”.

Motorsport Games Company Profile

Motorsport Games, Inc is a publicly traded developer and publisher of interactive motorsport entertainment, headquartered in Miami, Florida. The company specializes in creating officially licensed racing simulation titles and managing associated esports competitions. By focusing exclusively on the motorsport genre, Motorsport Games aims to deliver authentic digital experiences that mirror the rules, tracks and vehicles of real-world racing series.

The company’s core activities include the development of video games under licenses from major sanctioning bodies such as NASCAR, the Fédération Internationale de l’Automobile (FIA) and International Motor Sports Association (IMSA).