GameSquare Esports, the parent company of esports agency Code Red Esports, reported just over C$1 million (GBP616,001) in revenues for 1Q 2021.
According to the release, Code Red experienced a revenue increase of 97 per cent year-over-year compared to 1Q 2020. The company credits its growth in revenue to the fact that its influencer segment nearly doubled during Q1 2021, in addition to increased consulting fees associated with Bud Light Europe.
Image credit: GameSquare Esports, Inc.
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Despite the increase, GameSquare recorded a total comprehensive loss of C$572,977 (GBP334,554), or $0.01 per share, during its first quarter.
GameSquare’s talent esports agency, Code Red, allowed the company to expand into the European market. The agency increased its focus on the influencer segment in late 2019, which ended up coinciding with the global pandemic. Revenue from this segment, led by influencer promotional fees, totalled C$456k (GBP266k) for 1Q 2021.
On March 16th, GameSquare completed the acquisition of Reciprocity Gaming, which will be reflected in 2Q 2021 financial results. Reciprocity announced downsizing in March 2020, releasing its staff and teams except for those its LGD Gaming-partnered Crossfire side and its League of Legends team, in partnership with Rainbow7.
Reciprocity will no longer pursue its own listing on the TSXV, GameSquare told Esports Insider, as it will be wholly owned by its new parent company.
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Justin Kenna, GameSquare CEO, commented: “Our first-quarter results demonstrate that our business is moving in the right direction. We have announced a couple of great deals in the short time since acquiring Reciprocity. The sales pipeline at the Gaming Community Network (“GCN”) and Code Red is robust with good progress on sales conversion. We are in talks with some of the most recognisable brands in the world and we look forward to making public announcements as contractually allowed.”
Looking forward to the future, the company says it has initiated discussions with a ‘number of attractive acquisition targets.’
Kevin Wright, President of GameSquare, added: “We have a specific set of criteria that we consider, and we are at various stages with companies that would be tremendous additions to the GameSquare family of companies. We continue to build our pipeline and to progress conversations with esports businesses, and more broadly sports and entertainment businesses, that have shown high growth with a focus on profitability.”
Esports Insider says: GameSquare’s aggressive expansion efforts don’t appear to be slowing down anytime soon. The acquisition also paints a brighter future for Team Reciprocity, which was forced to strip operations down to its bare bones last year.