Doubledown Interactive Ltd (DDI)

Doubledown Interactive Ltd – Annual Financial Analysis

Report Date: 2025‑04‑30
Period Covered: Full Year 2024

1. Overview

Doubledown Interactive Ltd ("the Company") develops and operates social casino games (e.g., Doubledown Casino, Fort Knox, Classic) and iGaming platforms in regulated European markets through its SuprNation acquisition.

2. Profit and Debt Analysis

2.1 Profit Performance

• 2024 Net Profit: $1.244 billion (vs. $1.011 billion in 2023)
• Profit Margin: 36.4% of $3.413 billion revenue (up from 32.7%)

2.2 Debt Profile

• Total Borrowings: $340 million senior notes (due May 2026)
• Debt Reduction: From $387.8 million in 2023 to $340 million in 2024
• Interest Rate: Fixed at 4.60% p.a.

3. Drivers of Financial Results

• Revenue Growth Drivers:
  • SuprNation contributed $331 million in iGaming revenue for a full year in 2024.
  • Social casino core revenue rose 1.2% organically as ARPDAU improved to $1.30 (from $1.09).

• Cost Control:
  • Cost of revenue as a % of sales fell from 32.0% to 30.3% due to shifting mix toward in‑house content.
  • Marketing spend down from 16.2% to 13.5% of revenue, reflecting a focus on high‑value cohorts.

• R&D and G&A:
  • R&D was $139 million (4.1% of sales) vs. $212 million (6.9%).
  • G&A rose modestly as part of integration and compliance build‑out.

4. Pros and Cons

Pros

• Exceptional cash flow: $1.485 billion generated from operations.
• Strong margins in social casino (adjusted EBITDA margin 41.6%).
• Diversification into regulated iGaming (SuprNation) adds $331 million revenue line.

Cons

• Regulatory risks in U.S. social casino (Washington state inquiries, IP license disputes).
• Foreign exchange volatility: translation losses of $37 million in 2024.
• Dependence on platform partners (Apple, Google, Facebook) and licensing agreements for key content.

• Total Revenue: $3.413 Bn – Social Casino: $3.083 Bn; iGaming (Europe): $0.331 Bn • Platform Mix (Social Casino): Mobile $2.303 Bn vs. Web $1.110 Bn • Geography (Social Casino): US & Canada $2.691 Bn; UK $0.271 Bn; International $0.251 Bn • Key KPIs (Social Casino):
– Average MAU: 6.51 M; Average DAU: 1.54 M
– Payer Conversion: 7.0% (vs. 5.7%)
– ARPDAU: $1.30 (vs. $1.09)

Doubledown’s trajectory is underpinned by strong free‑to‑play monetization and cash flow generation. The integration of SuprNation provides meaningful diversification into regulated iGaming, enhancing revenue stability. Continued improvements in ARPDAU and reduced marketing intensity point to higher organic ROI. Key challenges include regulatory scrutiny in U.S. social casinos, dependency on third‑party platforms and licensing, and FX headwinds. Future opportunities lie in expanding proprietary content, deepening European iGaming penetration, and leveraging data‑driven live‑ops. Investors should monitor IP disputes, evolving gambling regulations and foreign currency impacts. Continuous R&D and strategic M&A could drive next‑phase growth, while robust cash flow supports debt reduction and selective reinvestment.