UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 4, 2021
Commission File Number: 001-39896
(Exact Name of Registrant as Specified in its Charter)
| (State of other jurisdiction | (I.R.S. Employer | |||||||
| of incorporation or organization) | Identification No.) | |||||||
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b 2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On August 4, 2021, Playtika Holding Corp. issued a press release announcing its financial results for the quarter ended June 30, 2021. A copy of the press release is furnished herewith as Exhibit 99.1.
In accordance with General Instruction B.2. of Form 8-K, the information in this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| 99.1 | ||||||||
| 99.2 | ||||||||
| 104 | Cover page interactive data file (embedded within the Inline XBRL document). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| PLAYTIKA HOLDING CORP. | |||||
| Registrant | |||||
| By: | /s/ Craig Abrahams | ||||
| Craig Abrahams | |||||
| President and Chief Financial Officer | |||||
| Dated as of August 4, 2021 | |||||
Exhibit 99.1
Playtika Holding Corp. Reports Second Quarter 2021 Results
Second Quarter Revenue Grew to $659 million, Driven Entirely by Organic Growth
Announcing New Game Launch in Q4’21
Proprietary Platforms Increased to Over 20% of Overall Revenues
Reiterating 2021 Financial Outlook
Herzilya, Israel - August 4, 2021 - Playtika Holding Corp. (NASDAQ: PLTK) today released financial results for its second quarter for the period ending June 30, 2021.
Second Quarter 2021 Financial Highlights:
•Second quarter revenue was $659.2 million compared to $650.5 million in the prior year period.
•Net income was $90.0 million compared to a loss of $139.6 million in the prior year period.
•Adjusted EBITDA, a non-GAAP financial measure defined below, was $264.4 million compared to $283.2 million in the prior year period.
•Our cash and cash equivalents totaled $1,179.7 million as of June 30th, 2021 with $600 million in additional borrowing capacity pursuant to our Revolving Credit Facility, resulting in over $1.7 billion of available liquidity.
“Our business in the second quarter accelerated across several key areas,” said Robert Antokol, Chief Executive Officer of Playtika. “We enhanced player conversion, drove revenues to our proprietary platforms and ramped up new game development, allowing us to announce our upcoming new game’s global launch ahead of schedule. With this momentum we feel optimistic about our prospects for the remainder of 2021 and beyond.”
“We were pleased to achieve organic revenue growth against a challenging comparable in the prior year quarter,” said Craig Abrahams, President and Chief Financial Officer. “Our teams utilized our live-ops capabilities to develop and leverage our Boost technology platform across our game portfolio, allowing us to re-iterate guidance for both revenue and adjusted EBITDA for 2021. We remain optimistic for the future with over $1.7 billion of available liquidity to drive our M&A initiatives.”
Highlights
•Casual portfolio grew revenue 16% year-over-year
•Average Daily Player Conversion increased to 2.9%, up from 2.7% in Q2’20
•Bingo Blitz grew revenue 20% year-over-year
•Solitaire Grand Harvest grew revenue 61% year-over-year
•Board Kings grew revenue 18% year-over-year
New Game Developments
•Switchcraft: The Magical Match 3 & Mystery Story developed by our Wooga studio
•Global launch in Q4’21
•Wooga’s first ever story-driven puzzle game, adding onto a successful track record of casual game launches within the portfolio
•Additional new casual global game launch planned for 2022
Financial Outlook
For the full year 2021 the company anticipates revenue of $2.60 billion and Adjusted EBITDA of $1.0 billion.
Analyst Day Announcement
Playtika will host its first-ever Analyst Day in person and virtually on Monday, December 6th, 2021 in New York City.
Conference Call
Playtika management will host a conference call at 5:30 a.m. Pacific Time (8:30 a.m. Eastern Time) today to discuss the company’s results. The conference call can be accessed via the conference numbers below and also via a webcast accessible at investors.playtika.com. A replay of the call will be available through the website one hour following the call and will be archived for one year.
•Toll-free dial-in number: (833) 665-0587
•International dial-in number: (661) 407-1603
•Conference ID: 4792307
Summary Operating Results of Playtika Holding Corp.
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| (in millions of dollars, except percentages, Average DPUs, and ARPDAU) | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
| Revenues | $ | 659.2 | $ | 650.5 | $ | 1,298.1 | $ | 1,184.7 | |||||||||||||||
| Total cost and expenses | $ | 493.8 | $ | 722.5 | $ | 1,002.4 | $ | 1,143.5 | |||||||||||||||
| Operating income | $ | 165.4 | $ | (72.0) | $ | 295.7 | $ | 41.2 | |||||||||||||||
| Net income | $ | 90.0 | $ | (139.6) | $ | 125.7 | $ | (103.8) | |||||||||||||||
| Adjusted EBITDA | $ | 264.4 | $ | 283.2 | $ | 522.4 | $ | 469.4 | |||||||||||||||
| Net income margin | 13.7 | % | (21.5) | % | 9.7 | % | (8.8) | % | |||||||||||||||
| Adjusted EBITDA margin | 40.1 | % | 43.5 | % | 40.2 | % | 39.6 | % | |||||||||||||||
| Non-financial performance metrics | |||||||||||||||||||||||
| Average DAUs | 10.4 | 11.8 | 10.4 | 11.7 | |||||||||||||||||||
| Average DPUs (in thousands) | 300 | 315 | 298 | 293 | |||||||||||||||||||
| Average Daily Payer Conversion | 2.9 | % | 2.7 | % | 2.9 | % | 2.5 | % | |||||||||||||||
| ARPDAU | $ | 0.70 | $ | 0.61 | $ | 0.69 | $ | 0.56 | |||||||||||||||
| Average MAUs | 36.1 | 36.1 | 33.7 | 36.6 | |||||||||||||||||||
About Playtika Holding Corp.
Playtika Holding Corp. is a leading mobile gaming company and monetization platform with over 36 million monthly active users across a portfolio of games titles. Founded in 2010, Playtika was among the first to offer free-to-play social games on social networks and, shortly after, on mobile platforms. Headquartered in Herzliya, Israel, and guided by a mission to entertain the world through infinite ways to play, Playtika has 19 offices worldwide including Tel-Aviv, London, Berlin, Vienna, Helsinki, Montreal, Chicago, Las Vegas, Santa Monica, Newport Beach, Sydney, Kiev, Bucharest, Minsk, Dnepr, and Vinnytsia.
Forward Looking Information
In this press release, we make “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. Further, statements that include words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "present," "preserve," "project," "pursue," "will," or "would," or the negative of these words or other words or expressions of similar meaning may identify forward-looking statements.
Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include without limitation:
•our reliance on third-party platforms, such as the iOS App Store, Facebook, and Google Play Store, to distribute our games and collect revenues, and the risk that such platforms may adversely change their policies;
•our reliance on a limited number of games to generate the majority of our revenue;
•our reliance on a small percentage of total users to generate a majority of our revenue;
•our free-to-play business model, and the value of virtual items sold in our games, is highly dependent on how we manage the game revenues and pricing models;
•our inability to complete acquisitions and integrate any acquired businesses successfully could limit our growth or disrupt our plans and operations;
•we may be unable to successfully develop new games;
•our ability to compete in a highly competitive industry with low barriers to entry;
•we have significant indebtedness and are subject to the obligations and restrictive covenants under our debt instruments;
•the impact of the COVID-19 pandemic on our business and the economy as a whole;
•our controlled company status;
•legal or regulatory restrictions or proceedings could adversely impact our business and limit the growth of our operations;
•risks related to our international operations and ownership, including our significant operations in Israel and Belarus and the fact that our controlling stockholder is a Chinese-owned company;
•our reliance on key personnel;
•security breaches or other disruptions could compromise our information or our players’ information and expose us to liability; and
•our inability to protect our intellectual property and proprietary information could adversely impact our business.
Additional factors that may cause future events and actual results, financial or otherwise, to differ, potentially materially, from those discussed in or implied by the forward-looking statements include the risks and uncertainties discussed in our filings with the Securities and Exchange Commission. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur, and reported results should not be considered as an indication of future performance. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.
Except as required by law, we undertake no obligation to update any forward-looking statements for any reason to conform these statements to actual results or to changes in our expectations.
PLAYTIKA HOLDING CORP.
CONSOLIDATED BALANCE SHEETS
(In millions, except for per share data)
| June 30, | December 31, | ||||||||||
| 2021 | 2020 | ||||||||||
| (Unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | 1,179.7 | $ | 520.1 | |||||||
| Short-term bank deposits | 50.0 | — | |||||||||
| Restricted cash | 2.7 | 3.5 | |||||||||
| Accounts receivable | 169.5 | 129.3 | |||||||||
| Prepaid expenses and other current assets | 112.1 | 101.6 | |||||||||
| Total current assets | 1,514.0 | 754.5 | |||||||||
| Property and equipment, net | 98.1 | 98.5 | |||||||||
| Operating lease right-of-use assets | 84.5 | 73.4 | |||||||||
| Intangible assets other than goodwill, net | 309.7 | 327.7 | |||||||||
| Goodwill | 481.0 | 484.8 | |||||||||
| Deferred tax assets, net | 27.6 | 28.5 | |||||||||
| Other non-current assets | 4.5 | 8.8 | |||||||||
| Total assets | $ | 2,519.4 | $ | 1,776.2 | |||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | |||||||||||
| Current liabilities | |||||||||||
| Current maturities of long-term debt | $ | 12.3 | $ | 104.6 | |||||||
| Accounts payable | 42.9 | 34.6 | |||||||||
| Operating lease liabilities, current | 18.1 | 16.4 | |||||||||
| Accrued expenses and other current liabilities | 455.8 | 484.8 | |||||||||
| Total current liabilities | 529.1 | 640.4 | |||||||||
| Long-term debt | 2,428.5 | 2,209.8 | |||||||||
| Employee related benefits | 21.8 | 16.1 | |||||||||
| Operating lease liabilities, long-term | 74.6 | 67.0 | |||||||||
| Deferred tax liabilities | 74.5 | 86.4 | |||||||||
| Total liabilities | 3,128.5 | 3,019.7 | |||||||||
| Commitments and contingencies | |||||||||||
| Stockholders' equity (deficit) | |||||||||||
Common stock of US $0.01 par value; 1,600.0 shares authorized and 409.6 issued and outstanding at June 30, 2021; 400.0 shares authorized and 391.1 shares issued and outstanding at December 31, 2020(1) | 4.1 | 3.9 | |||||||||
| Additional paid-in capital | 979.6 | 462.3 | |||||||||
| Accumulated other comprehensive income | 7.9 | 16.7 | |||||||||
| Accumulated deficit | (1,600.7) | (1,726.4) | |||||||||
| Total stockholders' deficit | (609.1) | (1,243.5) | |||||||||
| Total liabilities and stockholders’ deficit | $ | 2,519.4 | $ | 1,776.2 | |||||||
(1) Prior period results have been adjusted to reflect the 400-for-1 stock split effected in January 2021
PLAYTIKA HOLDING CORP.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In millions, except for per share data)
(Unaudited)
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Revenues | $ | 659.2 | $ | 650.5 | $ | 1,298.1 | $ | 1,184.7 | |||||||||||||||
| Costs and expenses | |||||||||||||||||||||||
| Cost of revenue | 183.9 | 192.6 | 366.9 | 358.5 | |||||||||||||||||||
| Research and development | 91.8 | 65.8 | 177.0 | 126.6 | |||||||||||||||||||
| Sales and marketing | 146.5 | 125.8 | 286.6 | 251.1 | |||||||||||||||||||
| General and administrative | 71.6 | 338.3 | 171.9 | 407.3 | |||||||||||||||||||
| Total costs and expenses | 493.8 | 722.5 | 1,002.4 | 1,143.5 | |||||||||||||||||||
| Income (loss) from operations | 165.4 | (72.0) | 295.7 | 41.2 | |||||||||||||||||||
| Interest expense and other, net | 24.0 | 46.0 | 99.7 | 104.3 | |||||||||||||||||||
| Income (loss) before income taxes | 141.4 | (118.0) | 196.0 | (63.1) | |||||||||||||||||||
| Provision for income taxes | 51.4 | 21.6 | 70.3 | 40.7 | |||||||||||||||||||
| Net income (loss) | 90.0 | (139.6) | 125.7 | (103.8) | |||||||||||||||||||
| Other comprehensive income (loss) | |||||||||||||||||||||||
| Foreign currency translation | 2.8 | 2.3 | (7.1) | — | |||||||||||||||||||
| Change in fair value of derivatives | (1.6) | — | (1.7) | — | |||||||||||||||||||
| Total other comprehensive income (loss) | 1.2 | 2.3 | (8.8) | — | |||||||||||||||||||
| Comprehensive income (loss) | $ | 91.2 | $ | (137.3) | $ | 116.9 | $ | (103.8) | |||||||||||||||
| Net income (loss) per share attributable to common stockholders, basic | $ | 0.22 | $ | (0.37) | $ | 0.31 | $ | (0.27) | |||||||||||||||
| Net income (loss) per share attributable to common stockholders, diluted | $ | 0.22 | $ | (0.37) | $ | 0.31 | $ | (0.27) | |||||||||||||||
| Weighted-average shares used in computing net income (loss) per share attributable to common stockholders, basic | 409.6 | 378.6 | 408.1 | 378.3 | |||||||||||||||||||
| Weighted-average shares used in computing net income (loss) per share attributable to common stockholders, diluted | 411.7 | 378.6 | 410.6 | 378.3 | |||||||||||||||||||
PLAYTIKA HOLDING CORP.
CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
(Unaudited)
| Six months ended June 30, | |||||||||||
| 2021 | 2020 | ||||||||||
| Cash flows from operating activities | $ | 189.9 | $ | 183.1 | |||||||
| Cash flows from investing activities | |||||||||||
| Purchase of property and equipment | (20.2) | (24.5) | |||||||||
| Capitalization of internal use software costs | (23.9) | (4.4) | |||||||||
| Purchase of intangible assets | (6.6) | (12.8) | |||||||||
| Short-term bank deposits | (50.0) | — | |||||||||
| Other investing activities | 2.1 | — | |||||||||
| Net cash used in investing activities | (98.6) | (41.7) | |||||||||
| Cash flows from financing activities | |||||||||||
| Proceeds from bank borrowings, net | 887.7 | — | |||||||||
| Repayments on bank borrowings | (955.8) | — | |||||||||
| Proceeds from issuance of unsecured notes | 178.9 | — | |||||||||
| Proceeds from issuance of common stock, net | 470.4 | — | |||||||||
| Payment of debt issuance costs | (10.5) | — | |||||||||
| Borrowings under revolving credit facility | — | 250.0 | |||||||||
| Repayment of term loan and revolving credit facility | — | (345.8) | |||||||||
| Payment of tax withholdings on stock-based payments | — | (15.7) | |||||||||
| Net cash out flow for business acquisitions and other | — | (1.3) | |||||||||
| Net cash provided by (used in) financing activities | 570.7 | (112.8) | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | (3.2) | (0.1) | |||||||||
| Net change in cash, cash equivalents and restricted cash | 658.8 | 28.5 | |||||||||
| Cash, cash equivalents and restricted cash at the beginning of the period | 523.6 | 272.0 | |||||||||
| Cash, cash equivalents and restricted cash at the end of the period | $ | 1,182.4 | $ | 300.5 | |||||||
Non-GAAP Financial Measures
Adjusted EBITDA is a non-GAAP financial measure and should not be construed as an alternative to net income as an indicator of operating performance, nor as an alternative to cash flow provided by operating activities as a measure of liquidity, or any other performance measure in each case as determined in accordance with GAAP.
Below is a reconciliation of Adjusted EBITDA to net income, the closest GAAP financial measure. We define Adjusted EBITDA as net income before (i) interest expense, (ii) interest income, (iii) provision for income taxes, (iv) depreciation and amortization expense, (v) stock-based compensation, (vi) legal settlements, (vii) contingent consideration, (viii) acquisition and related expenses, (ix) expense under our long-term compensation plans, (x) M&A related retention payments, and (xi) certain other items, including impairments. We calculate Adjusted EBITDA Margin as Adjusted EBITDA divided by revenues.
We supplementally present Adjusted EBITDA and Adjusted EBITDA Margin because these are key operating measures used by our management to assess our financial performance. Adjusted EBITDA adjusts for items that we believe do not reflect the ongoing operating performance of our business, such as certain noncash items, unusual or infrequent items or items that change from period to period without any material relevance to our operating performance. Management believes Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors and analysts in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. Management uses Adjusted EBITDA and Adjusted EBITDA Margin to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and to compare our performance against other peer companies using similar measures. We evaluate Adjusted EBITDA and Adjusted EBITDA Margin in conjunction with our results according to GAAP because we believe they provide investors and analysts a more complete understanding of factors and trends affecting our business than GAAP measures alone.
Adjusted EBITDA and Adjusted EBITDA Margin as calculated herein may not be comparable to similarly titled measures reported by other companies within the industry and are not determined in accordance with GAAP. Our presentation of Adjusted EBITDA and Adjusted EBITDA Margin should not be construed as an inference that our future results will be unaffected by unusual or unexpected items.
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
(In millions)
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Net income (loss) | $ | 90.0 | $ | (139.6) | $ | 125.7 | $ | (103.8) | |||||||||||||||
| Provision for income taxes | 51.4 | 21.6 | 70.3 | 40.7 | |||||||||||||||||||
| Interest expense and other, net | 24.0 | 46.0 | 99.7 | 104.3 | |||||||||||||||||||
| Depreciation and amortization | 33.3 | 29.5 | 66.5 | 56.7 | |||||||||||||||||||
| EBITDA | 198.7 | (42.5) | 362.2 | 97.9 | |||||||||||||||||||
Stock-based compensation(1) | 25.5 | 260.3 | 49.8 | 260.3 | |||||||||||||||||||
Acquisition and related expenses(2) | 6.3 | 0.4 | 42.0 | 29.9 | |||||||||||||||||||
Legal settlement(3) | — | 37.6 | — | 37.6 | |||||||||||||||||||
Long-term cash compensation(4) | 30.2 | 21.2 | 60.0 | 32.2 | |||||||||||||||||||
M&A related retention payments(5) | 3.7 | 4.6 | 6.8 | 9.5 | |||||||||||||||||||
| Other one-time items | — | 1.6 | 1.6 | 2.0 | |||||||||||||||||||
| Adjusted EBITDA | $ | 264.4 | $ | 283.2 | $ | 522.4 | $ | 469.4 | |||||||||||||||
| Net income margin | 13.7 | % | (21.5) | % | 9.7 | % | (8.8) | % | |||||||||||||||
| Adjusted EBITDA margin | 40.1 | % | 43.5 | % | 40.2 | % | 39.6 | % | |||||||||||||||
_________
(1) Reflects, for the three and six months ended June 30, 2021 and 2020, stock-based compensation expense related to the issuance of equity awards to certain of our employees.
(2) Amounts for the six months ended June 30, 2021 primarily relate to bonus expenses paid as a result of the successful initial public offering of the Company’s stock in January 2021. Amounts for the three and six months ended June 30, 2020 include (i) contingent consideration expense with respect to our acquisitions of Seriously and Supertreat, and (ii) third-party fees for actual or planned acquisitions, including related legal, consulting and other expenditures.
(3) Reflects a legal settlement expense of $37.6 million for the three and six months ended June 30, 2020.
(4) Includes expenses recognized for grants of annual cash awards to employees pursuant to our Retention Plans, which awards are incremental to salary and bonus payments, and which plans expire in 2024. For more information, see the notes to our consolidated financial statements.
(4) Includes retention awards to key individuals associated with acquired companies as an incentive to retain those individuals on a long-term basis. For more information, see the notes to our consolidated financial statements.
Contacts
| Investor Relations | Press Contact | |||||||
| Playtika | The OutCast Agency | |||||||
| David Niederman | Angela Allison | |||||||
| davidni@playtika.com | playtika@theoutcastagency.com | |||||||
© 2020 Playtika Ltd. All Rights Reserved. SECOND QUARTER 2021 Earnings Presentation August 4th | 2021
LEGAL DISCLAIMER Forward-Looking Statements This presentation contains forward-looking statements. All statements contained in this presentation other than statements of historical facts, including statements regarding our business strategy, plans, market growth and our objectives for future operations, are forward-looking statements. The words “may,” “will,” “should,” “expect,” “would,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these words. Forward-looking statements contained in this presentation include, but are not limited to, , future revenues, expenses, and capital requirements; the implementation of our business model and strategic plans and initiatives including increased focus on in-house game development; our ability to improve on our user metrics and our ability among others. We have based these forward-looking statements largely on our current expectations and projections about our business, the industry in which we operate and financial trends that we believe may affect our business, financial condition, results of operations and prospects and these forward-looking statements are not guarantees of future performance or development. These forward-looking statements speak only as of the date of this presentation and are subject to a number of risks, uncertainties and assumptions, including business, regulatory, economic and competitive risks, uncertainties, contingencies and assumptions about us. Because forward-looking statements are inherently subject to risks and uncertainties, including our ability to compete in the market; our future relationship with third-party platforms, such as the iOS App Store and the Google Play Store; our ability to successfully launch new games and enhance our existing games that are commercially successful; continued growth in demand for in-app purchases in mobile games; our ability to acquire and integrate new games and content; the ability of our games to generate revenues;; capital expenditures and investments in our infrastructure; our use of working capital in general; retaining existing players, attracting new players and increasing the monetization of our player base; our ability to successfully manage our game economies; maintaining a technology infrastructure that can efficiently and reliably handle increased player usage, fast load times and the deployment of new features and products; attracting and retaining qualified employees and key personnel; maintaining, protecting and enhancing our intellectual property; protecting our players’ information and adequately addressing privacy concerns; our ability to expand into new markets and distribution platforms; and successfully acquiring and integrating companies and assets. Because some of these risks and uncertainties cannot be predicted or quantified and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward- looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Additional factors that may cause future events and actual results, financial or otherwise, to differ, potentially materially, from those discussed in or implied by the forward-looking statements include the risks and uncertainties discussed in our filings with the Securities and Exchange Commission. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur, and reported results should not be considered as an indication of future performance. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Except as required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise. This presentation also contains estimates and other statistical data made by independent parties and by Playtika relating to market size and growth and other data about Playtika’s industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Non-GAAP Financial Measures This presentation contains certain non-GAAP financial measures of us, including Adjusted EBITDA and Adjusted EBITDA Margin. A "non-GAAP financial measure" is defined as a numerical measure of a company's financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flow of the company. You should not consider these non-GAAP financial measures in isolation, or as a substitute for analysis of results as reported under GAAP. For information regarding the non-GAAP financial measures used by us, and for a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures, see the Appendix to this presentation. Presentation Title 2
SECOND QUARTER HIGHLIGHTS Delivered strong organic revenue growth of 1.3% on top of all-time-high comparable in Q2’20 Daily Player Conversion increased to 2.9%, up from 2.7% in Q2’20 Solitaire Grand Harvest, Bingo Blitz and Board Kings grew 61%, 20%, and 18% year-over-year, respectively Continued growth in casual games, now representing 48.5% of overall revenues, compared to 42.3% in Q2’20 Proprietary platform revenue grew to 20.4% of overall revenues, up from 13.0% in Q2’20 SWITCHCRAFT: The Magical Match 3 & Mystery Story. New game global launch slated for Q4’21 from our Wooga game studio 3
$639 $659 Q1'21 Q2'21 $283 $264 Q2'20 Q2'21 $651 $659 Q2'20 Q2'21 $258 $264 Q1'21 Q2'21 REVENUE +2.5% +3.2% +1.2% -6.6% SEQUENTIAL GROWTH Y/Y GROWTH AEBITDA* REVENUE AEBITDA* AEBITDA: We define Adjusted EBITDA as net income before (i) interest expense, (ii) interest income, (iii) provision for income taxes, (iv) depreciation and amortization expense, (v) stock-based compensation, (vi) legal settlements, (vii) contingent consideration, (viii) acquisition and related expenses, (ix) expense under our long-term compensation plans, (x) M&A-related retention payments, and (xi) certain other items, including impairments. GAAP net income/loss for the 3 months ended 6/30/2021, 3/31/21, 6/30/20 were $90.0m, $35.7m and ($139.6m), respectively. Adj EBITDA is a non-gaap measure, see reconciliation on slide 13. Q2 2021 REVENUE AND AEBITDA Reported year-over-year organic revenue growth despite all-time-high comparable in Q2’20 Core business model led to strong flow through and achieved 40.1% AEBITDA margins Q2 2021 Takeaways 4
0.61 0.70+15% ARPDAU* ($) 2.7% 2.9% +7% Daily Payer Conversion* (%) 315 300 -5% Average Daily Paying Users* (Thousands) LIVEOPS SUSTAINS PLAYER METRICS OVER ROBUST Q2’20 COMPARABLE Q2 2021Q2 2020 Average Daily Paying Users: the number of individuals who purchased, with real world currency, virtual currency or items in any of our games on a particular day. Daily Payer Conversion: (i) the total number of DPUs, (ii) divided by the number of DAUs on a particular day. Average Daily Payer Conversion for a particular period is the average of the Daily Payer Conversion rates for each day during that period. ARPDAU: Average Revenue per Daily Active User (i) the total revenue in a given period, (ii) divided by the number of days in that period, (iii) divided by the average DAUs during the period. 5
CASE STUDIES: STRONG GROWTH IN CASUAL BINGO BLITZ First full quarter clans feature from Slotomania launched in Bingo Blitz Second wave of Bingo Song and Dr. Phil campaign Leveraged Boost Platform to cross- pollinate learnings and features from other studios SOLITAIRE GRAND HARVEST Launched second season of My Farm feature Ran successful marketing campaign (geo-targeted Germany) New developments and daily updates to existing game features10+ +12% Y/Y 2nd Largest Game by Revenue in Portfolio Q2 Increase in ARPDAU 4+ 4th Largest Game by Revenue in Portfolio +60% Y/Y Q2 Increase in ARPDAU REVENUE +20% Y/Y REVENUE +61% Y/Y YEARS OLD YEARS OLD 6
REVENUE MIX SHIFT TO CASUAL INCREASING Casual Themed 42.3% Casino Themed 57.7% Q2’20 Q2’21 Casual Themed 48.5% Casino Themed 51.5% Casual Themed games includes: Bingo Blitz, June’s Journey, Solitaire Grand Harvest, Best Fiends, Board Kings, Pirate Kings, Pearls Peril, Best Fiends Stars and Other. Casino Themed games includes: Slotomania, House of Fun, World Series of Poker, Caesars Slots and Other. 7
REVENUE BREAKDOWN BY PLATFORM Q2 2021 Gross Revenue by Platforms Notes: 1.Includes iOS, Android, Facebook, Amazon, Windows and other third-party platforms 3rd Party Platforms (1) Proprietary Platforms ▪ Proprietary Platforms % of revenues increased to 20.4%, up from 13.0% in Q2’20 ▪ Proprietary Platforms % of revenues increased 230bps sequentially ▪ Driving gross margin increases; up 170 bps year-over-year 20% 80% PROPRIETARY PLATFORMS 8
REVENUE BY GEOGRAPHY USA. EMEA. APAC. OTHER Q2’20 Q2’21 71% 14% 8% 7% 72% 13% 8% 7% 9
NEW GAME LAUNCH AHEAD OF SCHEDULE ▪ SWITCHCRAFT is a mystery-themed, Match-3 game differentiated through unique and compelling storylines. Global launch in Q4’21. ▪ Developed by our studio in Berlin, creators of our hit title, June’s Journey ▪ Hundreds of spellbinding puzzles that unlock a thrilling urban fantasy full of mystery ▪ Additional new Casual title planned for 2022 10
FY2021 Adjusted EBITDA guidance of $1.0 billion Reiterating Prior FY2021 Guidance1 GUIDANCE Revenue guidance of $2.6 billion $2.6B $1.0B 1) Prior FY’21 guidance of Revenue of $2.6 billion and Adjusted EBITDA of $1.0 billion was provided on our Q1’21 earnings call on 5/11/21. Prior FY’21 guidance of Revenue of $2.44 billion and Adjusted EBITDA of $920 million was provided on our Q4’20 earnings call on 2/25/21. 11
© 2020 Playtika Ltd. All Rights Reserved. APPENDIX 12
RECONCILIATION Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures and should not be construed as alternatives to net income as indicators of operating performance, nor as alternatives to cash flow provided by operating activities as a measure of liquidity, in each case as determined in accordance with GAAP. Below is a reconciliation of Adjusted EBITDA to net income, the closest GAAP financial measure. We define Adjusted EBITDA as net income before (i) interest expense, (ii) interest income, (iii) provision for income taxes, (iv) depreciation and amortization expense, (v) stock-based compensation, (vi) legal settlements, (vii) contingent consideration, (viii) acquisition and related expenses, and (ix) certain other items, including impairments. We define Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of revenues. We supplementally present Adjusted EBITDA because it is a key operating measure used by our management to assess our financial performance. Adjusted EBITDA adjusts for items that we believe do not reflect the ongoing operating performance of our business, such as certain noncash items, unusual or infrequent items or items that change from period to period without any material relevance to our operating performance. Management believes Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors and analysts in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. Management uses Adjusted EBITDA and Adjusted EBITDA Margin to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and to compare our performance against other peer companies using similar measures. We evaluate Adjusted EBITDA in conjunction with our results according to GAAP because we believe it provides investors and analysts a more complete understanding of factors and trends affecting our business than GAAP measures alone. Adjusted EBITDA and Adjusted EBITDA Margin should not be considered as alternatives to net income (loss) as a measure of financial performance, or any other performance measure derived in accordance with GAAP 2021 2020 2021 Net income $ 90.0 $ (139.6) $ 35.7 Provision for income taxes 51.4 21.6 18.9 Interest expense and other, net 24.0 46.0 75.7 Depreciation and amortization 33.3 29.5 33.2 EBITDA 198.7 (42.5) 163.5 Share-based compensation 25.5 260.3 24.3 Acquisition and related expenses 6.3 0.4 35.7 Legal settlement - 37.6 - Long-term cash compensation 30.2 21.2 29.8 M&A related retention payments 3.7 4.6 3.1 Other one-time items - 1.6 1.6 Adjusted EBITDA $ 264.4 $ 283.2 $ 258.0 Three months ended June 30, Unaudited Unaudited Three months ended March 13