Announcement • May 18
EBET, Inc. announced delayed 10-Q filing On 05/16/2024, EBET, Inc. announced that they will be unable to file their next 10-Q by the deadline required by the SEC. Announcement • Oct 14
EBET, Inc.(OTCPK:EBET) dropped from NASDAQ Composite Index Esports Technologies, Inc. has been removed from NASDAQ Composite Index . Announcement • Aug 22
EBET Receives Deficiency Letter from the Listing Qualifications Department of the Nasdaq Stock Market On August 15, 2023, EBET, Inc. received a letter from the Staff, which notified the Company that it does not presently comply with Nasdaq’s Listing Rule 5550(b)(1) (the “Listing Rule”), which requires that the Company maintain a minimum of $2.5 million in stockholders’ equity, and that the Company also does not meet the alternatives of market value of listed securities or net income from continuing operations set forth in the Listing Rule. As previously reported, on November 21, 2022, EBET, Inc. (the “Company”) received a deficiency letter from the Listing Qualifications Department (the “Staff”) of the Nasdaq Stock Market (“Nasdaq”) notifying the Company that for the last 30 consecutive business days the bid price for the Company’s common stock had closed below the minimum $1.00 per share requirement for continued inclusion on the Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”). In accordance with Nasdaq Listing Rule 5810(c)(3)(A) (the “Compliance Period Rule”), the Company was provided an initial period of 180 calendar days to regain compliance with the Bid Price Rule. The Company requested an additional 180 days in which to regain compliance, and on May 23, 2023 the Company received notice from Nasdaq informing the Company that it had been granted an additional 180-day period, or until November 20, 2023, to regain compliance with the minimum bid price requirement. On July 31, 2023, the Company was notified by the Staff that it had determined that the Company’s common stock had a closing bid price of $0.10 or less for ten consecutive trading days from July 17, 2023 through July 28, 2023. Accordingly, since the Company was subject to the provisions set forth under Listing Rule 5810(c)(3)(A)(iii), the Staff had determined to delist the Company’s securities from The Nasdaq Capital Market. The Company submitted a hearing request to Nasdaq’s Hearings Department, which stayed the suspension of the Company’s common stock pending the panel’s decision. The Company’s hearing is scheduled for October 12, 2023. Announcement • Aug 05
EBET Determines to Delist the Company's Securities from the Nasdaq Capital Market As previously reported, on November 21, 2022, EBET, Inc. (the Company") received a deficiency letter from the Listing Qualifications Department (the Staff") of the Nasdaq Stock Market (Nasdaq") notifying the Company thatfor the last 30 consecutive business days the bid price for the Company's common stock had closed below the minimum $1.00 per share requirement for continued inclusion on the Nasdaq Capital Market pursuant to NasdaqListing Rule 5550(a)(2) (the Bid Price Rule"). In accordance with Nasdaq Listing Rule 5810(c)(3)(A) (the Compliance Period Rule"), the Company was provided an initial period of 180 calendar days to regain compliancewith the Bid Price Rule. The Company requested an additional 180 days in which to regain compliance, and on May 23, 2023 the Company received notice from Nasdaq informing the Company that it had been granted an additional 180-day period, or until November 20, 2023, to regain compliance with the minimum bid price requirement. On July 31, 2023, the Company was notified by the Staff that it had determined that the Company's common stock had a closing bid price of $0.10 or less for ten consecutive trading days from July 17, 2023 through July 28, 2023. Accordingly, since the Company was subject to the provisions set under Listing Rule 5810(c)(3)(A) (iii), the Staff had determined to delist the Company's securities from The Nasdaq Capital Market. The Staff letter stated that unless the Company requests an appeal of the Staff's determination, trading of the Company's common stock will be suspended at the opening of business on August 9, 2023, and a Form 25-NSE will be filed with the Securities and Exchange Commission, which will remove the Company's securities from listing and registration on The Nasdaq Stock Market. The Company plans to timely submit a hearing request to Nasdaq's Hearings Department, which will stay the suspension of the Company's common stock and the filing of the Form 25-NSE pending the panel's decision. New Risk • Jul 06
New minor risk - Share price stability The company's share price has been volatile over the past 3 months. It is more volatile than 75% of American stocks, typically moving 10% a week. This is considered a minor risk. Share price volatility indicates the stock is highly sensitive to market conditions or economic conditions rather than being sensitive to its own business performance, which may also be inconsistent. It also increases the risk of potential losses in the short term as the stock tends to have larger drops in price more frequently than other stocks. Currently, the following risks have been identified for the company: Major Risks Less than 1 year of cash runway based on free cash flow trend (-US$11m free cash flow). Earnings have declined by 76% per year over the past 5 years. Shareholders have been substantially diluted in the past year (78% increase in shares outstanding). Market cap is less than US$10m (US$3.54m market cap). Minor Risk Share price has been volatile over the past 3 months (10% average weekly change). Reported Earnings • May 14
Second quarter 2023 earnings released: US$0.25 loss per share (vs US$0.93 loss in 2Q 2022) Second quarter 2023 results: US$0.25 loss per share (improved from US$0.93 loss in 2Q 2022). Revenue: US$11.6m (down 39% from 2Q 2022). Net loss: US$5.57m (loss narrowed 58% from 2Q 2022). Price Target Changed • Nov 16
Price target decreased to US$3.00 Down from US$9.00, the current price target is provided by 1 analyst. New target price is 230% above last closing price of US$0.91. Stock is down 97% over the past year. The company is forecast to post a net loss per share of US$2.51 next year compared to a net loss per share of US$1.33 last year. Major Estimate Revision • Aug 22
Consensus forecasts updated The consensus outlook for 2022 has been updated. 2022 revenue forecast fell from US$65.9m to US$63.4m. 2022 losses expected to reduce from -US$3.00 to -US$2.51 per share. Hospitality industry in the US expected to see average net income growth of 13% next year. Consensus price target down from US$9.00 to US$3.00. Share price fell 14% to US$2.05 over the past week. Reported Earnings • Aug 16
Third quarter 2022 earnings: EPS exceeds analyst expectations while revenues lag behind Third quarter 2022 results: US$0.70 loss per share (down from US$0.38 loss in 3Q 2021). Revenue: US$18.2m (up US$18.1m from 3Q 2021). Net loss: US$10.4m (loss widened 163% from 3Q 2021). Revenue missed analyst estimates by 6.8%. Earnings per share (EPS) exceeded analyst estimates by 13%. Over the next year, revenue is forecast to grow 86%, compared to a 58% growth forecast for the Hospitality industry in the US. Seeking Alpha • Jul 14
EBET Ramps Revenue Growth From Recent Acquisitions EBET went public in April 2021 as Esports Technologies, raising around $14.4 million in gross proceeds in an IPO.
The firm enables online gambling services through a variety of brands.
EBET has grown revenue as a result of acquisitions but its operating losses are substantial and worsening.
Until the company can show revenue growth combined with a reduction of operating losses, I'm on Hold for the stock.
A Quick Take On EBET
EBET (EBET) went public as Esports Technologies in April 2021, raising approximately $14.4 in gross proceeds from an IPO that was priced at $6.00 per share.
The firm provides online gambling products via its recently acquired brands.
EBET’s high and increasing operating losses provide no path to operating breakeven and I see no upside catalyst given the firm’s current financial results unless it makes meaningful progress toward operating breakeven.
As a result, I’m on Hold for EBET in the near term.
EBET Overview
Las Vegas, Nevada-based EBET was founded to develop an online esports/sportsbook gambling service focused on the regions of the Asia Pacific and Latin America.
Management is headed by president, Chairman and CEO Aaron Speach, who has been with the firm since 2020 and was previously a founding member at ESEG Limited, which was acquired by the firm.
The company’s primary offerings include real money betting on:
Esports titles
Professional sporting events
iGaming casino games
The company operates via gaming license from the Curacao Gaming Authority with almost all of its wager history sourced from the Philippines.
Management seeks to expand its target sources to Japan, Thailand, Mexico, and South America.
The firm operates its platform at gogawi.com, where 70% of its customers bet on esports competitions and 30% bet on traditional sporting events.
Management has sought to create a 'business-to-business' experience that seeks to match larger volume betting interest 'across businesses operating in the esports wagering space,' since it believes the industry has produced solutions that have been more focused on the 'recreational bettor.'
EBET’s Market & Competition
According to a 2020 market research report by QYResearch, the global market for esports and esports gambling was an estimated $142 billion in 2020 and is expected to exceed $203 billion by 2026.
This represents a forecast CAGR of 6.2% from 2021 to 2026.
The main drivers for this expected growth are an increase in demand from mobile users to bet on esports activities as well as a wider range of esports events and opportunities to wager on.
Also, in 2019, Europe accounted for the largest market share in the industry at 47.7%. China [Macau] represented the second largest market at 21.2% market share.
Major competitive or other industry participants include:
DraftKings (DKNG)
Bet365
Pinnacle
Flutter Entertainment (FanDuel) (PDYPY) (PDYPF)
William Hill (WIMHY) (WIMHF)
Roar Digital
Luckbox
EBET’s Recent Financial Performance
Total revenue by quarter has grown markedly in recent quarters due to the acquisition of a number of brands:
5 Quarter Total Revenue (Seeking Alpha)
Gross profit by quarter has also grown in a similar trajectory as that of total revenue:
5 Quarter Gross Profit (Seeking Alpha)
Operating income by quarter has worsened sharply into negative territory over the past 5 quarters:
5 Quarter Operating Income (Seeking Alpha)
Earnings per share (Diluted) have followed a similar path as Operating Income:
5 Quarter Earnings Per Share (Seeking Alpha)
In the past 12 months, EBET’s stock price has dropped 88.4 percent vs. the U.S. S&P 500 index’ decline of around 12.7 percent, as the chart below indicates:
52 Week Stock Price (Seeking Alpha)
Valuation Metrics For EBET
Below is a table of relevant capitalization and valuation figures for the company:
Measure
Amount
Enterprise Value
$63,700,000
Market Capitalization
$35,980,000
Enterprise Value / Sales [TTM]
2.43
Price / Sales [TTM]
1.18
Revenue Growth Rate [TTM]
16059.00%
Operating Cash Flow [TTM]
-$14,050,000
Earnings Per Share (Fully Diluted)
-$2.44 Reported Earnings • May 17
Second quarter 2022 earnings: EPS and revenues miss analyst expectations Second quarter 2022 results: US$0.93 loss per share (down from US$0.22 loss in 2Q 2021). Revenue: US$19.0m (up US$19.0m from 2Q 2021). Net loss: US$13.2m (loss widened 456% from 2Q 2021). Revenue missed analyst estimates by 11%. Earnings per share (EPS) also missed analyst estimates by 258%. Over the next year, revenue is forecast to grow 226%, compared to a 86% growth forecast for the industry in the US. Reported Earnings • Feb 12
First quarter 2022 earnings: Revenues exceed analysts expectations while EPS lags behind First quarter 2022 results: US$0.68 loss per share (down from US$0.30 loss in 1Q 2021). Revenue: US$7.14m (up US$7.13m from 1Q 2021). Net loss: US$9.36m (loss widened 240% from 1Q 2021). Revenue exceeded analyst estimates by 1.4%. Earnings per share (EPS) missed analyst estimates. Over the next year, revenue is forecast to grow 980%, compared to a 143% growth forecast for the industry in the US. Reported Earnings • Dec 25
Full year 2021 earnings: Revenues and EPS in line with analyst expectations Full year 2021 results: US$1.33 loss per share (down from US$0.078 loss in FY 2020). Net loss: US$15.2m (loss widened US$14.6m from FY 2020). Revenue was in line with analyst estimates. Reported Earnings • Dec 25
Full year 2021 earnings: Revenues and EPS in line with analyst expectations Full year 2021 results: US$1.33 loss per share (down from US$0.078 loss in FY 2020). Net loss: US$15.2m (loss widened US$14.6m from FY 2020). Revenue was in line with analyst estimates. Announcement • Aug 21
Esports Technologies Files Patent for Artificial Intelligence-Powered Real-Time Odds Modeling & Simulation System Esports Technologies, Inc. announced that it has filed a provisional patent application for a technology that uses artificial intelligence to generate odds models for use in a betting algorithm for esports tournaments and various stages of a tournament. The system uses machine learning and advanced quantitative methods to generate odds instantly for any number of esports match and tournament types, as well as for different stages of the match or tournament for proposition bets, and a variety of betting markets. The filing contemplates a system where bettors can wager on teams throughout a tournament and while games are being played. Examples of bets that could be made with this technology include which team will place in the top three, or outside the top five, or what round the team will make it to. Announcement • May 26
Esports Technologies Launches on Google Play Store with Esports Games App Esports Technologies, Inc. announced the launch of its app, Esports Games, providing tournament prediction and trivia games for esports fans worldwide, on the Google Play store in the United States, United Kingdom, and Canada. The new platform consists of two types of engagement games, focused on esports content: tournament predictions and trivia. Qualified players are expected to be able to enter and participate for free. For trivia contests players can answer questions to score points and achieve placement on a global leaderboard. Similarly, the prediction game allows players to predict the outcomes of live-esports match events. The compsny selected a leading free-to-play platform, Splash Tech, to help develop the Esports Games App. Announcement • May 12
Esports Technologies Adds Rocket League to Its International Betting Platform Esports Technologies announced it is adding Rocket League to the roster of games available for wagering on its international consumer platform, Gogawi.com. Rocket League joins the list of major esports titles Gogawi is currently accepting wagers on, including: Counter-Strike: GO; League of Legends; Dota 2; StarCraft 2; Rainbow Six; Warcraft 3; King of Glory; FIFA. The platform also allows for more traditional sports betting on the NFL, NBA, Soccer, and more than 40 other sports. The platform also recently added casino and table games to its betting roster thanks to its recently announced partnership with Spinomenal.