Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Management prioritized margin preservation and cash flow over aggressive revenue expansion, resulting in a 212 basis point EBITDA margin expansion despite a 12% revenue decline.
Performance was bolstered by 44% year-over-year growth in proprietary content revenue within North America, which management identifies as their most profitable product and most critical market. Revenue headwinds were driven by the anticipated roll-off of legacy turnkey contracts in the Netherlands and a shift in Brazil where operators moved to direct supply integrations. Regulatory changes in European jurisdictions, specifically Croatia, proved more impactful than anticipated due to new restrictions on customer acquisition and advertising.
The company is accelerating an 'AI-first' transformation to reduce unit costs for content creation and streamline the organizational structure. A significant workforce reduction of approximately 19% was implemented in July to accelerate the path to cash profitability and create a leaner, core-product-focused organization. Management withdrew fiscal 2026 guidance due to the early stage of integrating Drayton International and the complexity of forecasting its five equity-interest game studios.
The strategic focus has shifted toward becoming an 'architect of the ecosystem' rather than a component supplier, emphasizing high-margin in-house IP over low-margin aggregation. The Drayton acquisition is expected to significantly expand addressable reach by entering the Advanced Deposit Wagering (ADW) market, which is available in over 30 U.S. states compared to 7 for traditional iGaming. Full annualized cash savings from restructuring are expected to reach approximately EUR 10.5 million, with the impact primarily visible starting in Q4 2026 and into 2027.
Future growth is predicated on the continued expansion of the North American iCasino market, which management estimates has a $97 billion maturity potential. Completed the acquisition of Drayton International for USD 9 million, settled entirely in shares to preserve cash. Appointed Matt Davey as Non-Executive Chairman and Jordan Gnat to the Board, bringing deep expertise in digital sports media and gaming operations.
Renewed a revolving credit facility with Bank of Montreal for an additional year to maintain liquidity during the integration phase. Reported a 14% reduction in gross compensation costs (pre-capitalization) year-over-year, demonstrating early execution of cost-optimization initiatives. Nvidia-level potential. 30M+ investors trust Moby to find it first.
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