Gamehaus Holdings Inc. Class A Ordinary Shares 2026 Q4 Earnings Call

Hello, everyone. Thank you all for joining us on today's conference call to discuss the financial results of Gamehaus for the fourth quarter and full year of fiscal 2026. We released our earnings results earlier today. The press release is available on the company's website as well as from Newswire services. On the call with me today are Mr. Brian Xie Feng, Chairman of the Board, Mr. Carl Cai Yimin, Chief Executive Officer, and Mr. Shawn Zhang, Head of Capital Markets and Investor Relations. Brian will review business operations and company highlights, followed by Shawn, who will discuss detailed financial results. They will all be available to answer your questions during the Q&A session.

Before we proceed, I would like to remind you that this call may contain forward-looking statements, which are inherently subject to risks and uncertainties that may cause actual results to differ from our current expectations. For detailed discussions of the risks and uncertainties, please refer to our filings with the SEC. Also, please note that unless otherwise stated, all figures mentioned during the conference call are in U.S. dollars. With that, I would like to introduce our chairman, Brian. Brian will deliver his remarks in Chinese, and I will follow up with corresponding English translations. Please go ahead, Brian. Good day everyone, and thank you for joining Gamehaus conference call for the fourth quarter and full year of fiscal 2026. Fiscal year 2026 was Gamehaus' last full fiscal year under its previous business model. Earlier in August, we announced a strategic transformation for the company.

This quarter marks the beginning of the execution phase of that transformation. As a result, today's discussion covers both our operating performance before the decision was made and the initial financial implications of the transformation. For the full fiscal year 2026, total revenue was $104.7 million, and net income was $3.9 million. In the fourth quarter, total revenue was $24.3 million, within our previously announced outlook range of $23 million-$26 million, and net income was $0.9 million. Against the current industry backdrop, we have seen a structural shift in the economics of user acquisition for casual games. The player base in mature markets has remained stagnant for an extended period, while platform attribution and targeting capabilities have continued to weaken. At the same time, competition for user acquisition has increasingly become a zero-sum game within a largely fixed pool of users.

Together, these factors have continued to compress margins in game publishing. We do not view this as an issue with any single title or any particular quarter. Rather, we believe it reflects a longer-term change in the environment surrounding this business model. Based on this assessment, we decided to proactively adjust our resource allocation and redirect more resources toward new opportunities opened up by generative AI.

买量投入则按回报水平在产品之间重新分配。这项调整自7月开始执行，因此本次财报所覆盖的期间尚未体现其影响。我们预计存量业务的流水规模将逐步收窄，这一点会反映在我们稍后给出的下一季度的指引中。 In terms of execution, beginning this quarter, we have changed the way we manage our existing portfolio of casual and social casino mobile games, with a greater focus on cash flow and profitability.

User acquisition spending will also be reallocated across titles based on expected returns. We began implementing these changes in July, so their impact is not yet reflected in the period we are reporting today. We expect revenue from our existing portfolio to gradually decline, and this is reflected in the outlook we will provide later for the next quarter.

本季度的运营数据已经体现出这一管理方式的方向。第四季度DAUs与MAUs较上年同期有所下降，但单日活跃用户平均收入由$0.517提升至$0.577，同比增长11.6%。日均付费转化率由2.3%提升至2.5%。在战略调整的背景下，我们将持续提升运营质量，并充分挖掘现有用户群体的价值，维护好使用体验。 Our operating metrics this quarter already reflect this shift in focus.

While both DAUs and MAUs declined year-over-year in the fourth quarter, ARPDAU increased 11.6% to $0.577 from $0.517. Average daily payer conversion improved to 2.5% from 2.3%. As we execute this strategic transformation, we will remain focused on improving the quality of our operations, maximizing the value of our existing player base, and maintaining a strong player experience.

与此同时，公司的财务状况和现金储备保持稳健。截至2026年6月30日，公司持有现金及现金等价物1,760万美元，较上一财年的1,520万美元有所增加。公司在本财年内持续实现盈利，增加现金储备，并同时执行了股份回购计划。我们认为公司目前的财务状况为我们完成本次战略转型提供了坚实的基础。 At the same time, our financial position and cash reserves remain solid.

As of June 30, 2026, we had $17.6 million in cash and cash equivalents, up from $15.2 million at the end of the prior fiscal year. During the fiscal year, we remained profitable, increased our cash reserves, and continued executing our share repurchase program. We believe our current financial position provides a solid foundation for executing this strategic transformation.

在以新方式管理现有业务的同时，公司仍继续推进DTC占比的提升。截至本财季末，公司整体DTC渠道占比已提升至16.2%，较上一季度进一步提升。DTC降低了平台分成成本，直接改善产品的毛利水平。本财季毛利率的同比提升主要来自这一原因。这项改善与买量投入水平无关，属于结构性改善，会随着DTC占比继续提升而扩大。DTC是我们在存量组合中持续投入的少数方向之一。公司的目标是在2026年12月31日前将整体DTC渠道的占比提升至20%以上。 As we manage our existing business under this new approach, we are also continuing to increase our DTC penetration.

By the end of the fiscal quarter, our company-wide DTC revenue mix had reached 16.2%, up further from the previous quarter. DTC reduces platform commissions and directly improves gross margin for our gains, driving the year-over-year improvement in gross margin this quarter. Importantly, this improvement does not depend on the level of our user acquisition spending. It is structural in nature and should become more meaningful as DTC penetration continues to increase. DTC remains one of the few areas where we continue to invest across our existing portfolio. Our goal is to increase overall DTC penetration to more than 20% by December 31, 2026.

关于前面提到的新方向，我也向大家简要说明目前的进展。本财年内，公司完成了一笔对早期AI游戏生成工作室的少数股权投资。自6月起，我们与该团队共同完成了完整生产流程的验证，并识别出当前生产能力尚不能覆盖的环节。目前的工作重点是确定切入市场的产品形态。这项工作仍处在早期阶段，我们不会在此时给出具体的产品数量或时间表。当有实质进展时，我们会及时向市场说明。与此同时，我们也在密切关注AI生成内容在其他业务领域的机会，以全球尽快形成新的增长曲线，并在未来成为一个由AI驱动的全球内容生产及分发平台。 Let me also briefly update you on the new direction I mentioned earlier.