• Bidstack, a UK-based in-game advertising (IGA) platform, reported its financial performance for the first six months of 2022 (1H 2022). The firm’s revenue rose steeply by 149.5% YoY, recording revenue of GBP 2 million (~USD 2.4 million) in 1H 2022. The growth was supported by the two-year licensing agreement with Azerion, a digital entertainment and media platform that became the exclusive reseller of PubGuard, Bidstack's ad-quality platform, while using it across its group of companies. In addition, the firm's video game inventory more than tripled to 110 titles during the period (compared to 30 titles in 1H 2021). 

<ul><li>The firm’s gross profit rose to GBP 816,761 (~USD 996,448; 189% YoY growth) in 1H 2022, while its gross profit margin increased to 39.9% (1H 2021: 34.5%). The margin improvement was supported by the launch of its first white-label deal with an Asia-Pacific mobile marketing technology company as well as the launch of a new ad format that expands the monetization opportunities available to developers and publishers.</ul>

• However, the firm’s operating loss expanded by 1.6% YoY during 1H 2022 to GBP 3.7 million (~USD 4.5 million), which was driven by administrative expenses that rose by 15% YoY. This may have contributed to the 1.1% dip in Bidstack’s share price, following the release of its financial results.  

• During 2H 2022, the firm also plans to launch an open-market place (OMP) for IGA, which is expected to further drive its performance. While the management did not disclose any specific targets, analysts expect Bidstack to achieve a revenue of GBP 8.9 million in 2022 (~USD 10.9 million), a growth of 242.3% YoY.

Analyst QuickTake: The firm's strategic focus on the development of white-label products and exclusive reseller agreements is beginning to bear fruit and is likely to support further expansion of its gross margin as a result of its white-label contract. This adds a passive recurring revenue to the firm while providing it exposure to the Asia-Pacific market. This is likely to also support the management’s objectives of improving its cash management and gross margin while providing greater scope for managing its operating expenses.