GameSquare (NASDAQ:GAME) CEO and President Justin Kenna outlined the company’s strategy to expand beyond gaming-focused services into broader internet culture, creator monetization and owned intellectual property, following the recent closing of its FanEngine acquisition.
Kenna said GameSquare’s business is centered on connecting brands, creators and consumers, with operations spanning data and analytics, creator talent, agency services and, now, owned IP through FanEngine. The company was listed on the Canadian Securities Exchange in 2020, uplisted to Nasdaq in 2023 and is now solely Nasdaq-listed, he said.
2027 Outlook Includes FanEngine Contribution
For 2027, Kenna said GameSquare expects its standalone operations to generate approximately $100 million in revenue and $10 million in EBITDA, based on what he described as 20% organic growth. He said FanEngine is expected to contribute an additional $50 million in revenue and $20 million in EBITDA, bringing the combined outlook to roughly $150 million in revenue and $30 million in EBITDA.
Kenna characterized FanEngine as a higher-margin business that adds limited fixed costs, estimating approximately $2 million in annual costs and about 15 employees. He said the integration was already underway and would be relatively straightforward because GameSquare’s existing services could be used across FanEngine’s properties.
The acquisition was structured as an all-stock transaction, with FanEngine receiving roughly 30% of the equity upfront. Kenna said the deal resulted in the issuance of approximately 5.5 million shares, increasing GameSquare’s outstanding share count from about 13 million to just above 18 million.
Under the earn-out structure, FanEngine could receive another 10% in equity if it meets revenue milestones over two periods, according to Kenna. The sellers may also receive cash tied to profitability, receiving 50 cents for every dollar of profit above an $8 million threshold, up to a $25 million cash cap. Kenna said the company has approximately $50 million of net operating loss carryforwards, though he noted their application depends on jurisdiction.
Data, Creators and Agency Services
Kenna described Stream Hatchet, GameSquare’s data and analytics operation, as comparable to Nielsen’s role in broadcast television, but for gaming and streaming. He said nine of the top 10 global game publishers purchase data from the company and that Stream Hatchet serves as the official data provider for the Esports World Cup and Esports Nations Cup.
GameSquare’s creator operations include nearly 100 contracted talent relationships, Kenna said, as well as nonexclusive creator deployment programs for brands and game publishers. He said marketers are increasingly shifting budgets from a small number of large creators toward broader campaigns using thousands of smaller, highly engaged creators.
The company’s agency business provides creative and strategy, consumer products, live events, content production and media services. Kenna said GameSquare is agency of record for the Dallas Cowboys, Jack in the Box and Dairy MAX, and also works with companies including Topgolf, Converse, Roblox and Epic Games. He pointed to the growth of retainer relationships as a source of recurring and longer-term revenue.
FanEngine Adds Entertainment and Athlete IP
FanEngine’s entertainment portfolio includes properties such as Peaky Blinders and Simon’s Cat, while its media operations focus on traditional athletes and sports content. Kenna said Simon’s Cat had generated $50 million in revenue and $9 million in profit over the prior two periods through tokenization. He also said GameSquare has a minimum guarantee associated with the property that represents an additional $5 million of profit.
Kenna said GameSquare plans to launch its Peaky Blinders project in mid-November and expects additional announcements and brand integrations around the property. He also cited FanEngine’s work with NBC Premier League broadcasters Robbie Mustoe and Robbie Earle, known as The Two Robbies. Before the transaction, FanEngine produced a live World Cup-related show in New York that Kenna said generated about $2 million in revenue over six weeks, with roughly $600,000 spent on content production.
GameSquare also owns FaZe Esports and co-owns SpongeBob IP with Paramount for Fortnite integrations, Kenna said. The company plans to develop approximately four SpongeBob maps over the next 12 months.
Balance Sheet and Capital Allocation
Kenna said GameSquare raised about $90 million between the second and third quarters of the prior year and used part of the proceeds to purchase Ethereum. The company currently holds approximately 10,000 ETH, down from roughly 15,500 ETH originally held, and has no long-term debt, he said.
GameSquare intends to liquidate its remaining Ethereum holdings by the end of the first quarter and focus capital on its operating business, according to Kenna. He said the company has close to $30 million in cash, Ethereum and cash equivalents and does not need to raise additional capital. If the company’s share price does not respond to operating progress, Kenna said GameSquare may consider stock repurchases, although he said management would prefer to direct cash toward growth opportunities.
About GameSquare (NASDAQ:GAME)
GameSquare Holdings, Inc is a gaming and esports media and entertainment company that connects brands with gaming audiences through esports teams, content creators, digital media, advertising and live experiences. The company develops and distributes gaming-related content across social media, streaming platforms and other digital channels, while providing marketing and creative services to advertisers and corporate partners.
GameSquare’s portfolio has included esports and gaming properties such as FaZe Clan and Complexity Gaming, along with creative, media and talent-focused businesses.
