When Will GameSquare Holdings, Inc. (NASDAQ:GAME) Become Profitable?
We feel now is a pretty good time to analyse GameSquare Holdings, Inc.'s (NASDAQ:GAME) business as it appears the company may be on the cusp of a considerable accomplishment. GameSquare Holdings Inc. operates as a vertically integrated digital media, entertainment, and technology company with an audience of approximately 290 million followers. The company’s loss has recently broadened since it announced a US$18m loss in the full financial year, compared to the latest trailing-twelve-month loss of US$21m, moving it further away from breakeven. The most pressing concern for investors is GameSquare Holdings' path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Check out our latest analysis for GameSquare Holdings
According to some industry analysts covering GameSquare Holdings, breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$5.3m in 2025. The company is therefore projected to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 87% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
Underlying developments driving GameSquare Holdings' growth isn’t the focus of this broad overview, but, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 22% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of GameSquare Holdings which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at GameSquare Holdings, take a look at GameSquare Holdings' company page on Simply Wall St. We've also compiled a list of key aspects you should further examine:
Valuation: What is GameSquare Holdings worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether GameSquare Holdings is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on GameSquare Holdings’s board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
