Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2021 | May 03, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q/A | |
Amendment Flag | true | |
Amendment Description | GAN Ltd, (the “Company”) is filing this Amendment No. 1 on Form 10-Q/A (this “Amendment No. 1”) to amend its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021, filed with the Securities and Exchange Commission (the “SEC”) on May 17, 2021 (the “Original Form 10-Q”). The purpose of this Amendment No. 1 is to restate our previously issued unaudited interim condensed consolidated financial statements for the three months ended March 31, 2021, contained in the Original Form 10-Q (the “Restatement”). | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-39274 | |
Entity Registrant Name | GAN Limited | |
Entity Central Index Key | 0001799332 | |
Entity Tax Identification Number | 00-0000000 | |
Entity Incorporation, State or Country Code | D0 | |
Entity Address, Address Line One | 400 Spectrum Center Drive | |
Entity Address, Address Line Two | Suite 1900 | |
Entity Address, City or Town | Irvine | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92618 | |
City Area Code | 702 | |
Local Phone Number | 964-5777 | |
Title of 12(b) Security | Ordinary shares (Par Value $0.01) | |
Trading Symbol | GAN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 42,007,600 | |
Entity Information, Former Legal or Registered Name | Not applicable |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash | $ 52,185 | $ 152,654 |
Accounts receivable, net of allowance for doubtful accounts of $178 and $100 at March 31, 2021 and December 31, 2020, respectively | 12,170 | 6,818 |
Prepaid expenses | 2,800 | 1,912 |
Other current assets | 3,423 | 2,112 |
Total current assets | 70,578 | 163,496 |
Capitalized software development costs, net | 7,715 | 6,648 |
Goodwill | 152,734 | |
Intangible assets, net | 43,855 | 468 |
Other assets | 3,926 | 2,634 |
Total assets | 278,808 | 173,246 |
Current liabilities | ||
Accounts payable | 4,329 | 4,926 |
Accrued compensation and benefits | 6,127 | 4,956 |
Accrued expenses | 4,414 | 3,363 |
Liabilities to users | 6,916 | |
Other current liabilities | 3,733 | 4,067 |
Total current liabilities | 25,519 | 17,312 |
Deferred income taxes | 2,167 | |
Other noncurrent liabilities | 1,719 | 370 |
Total liabilities | 29,405 | 17,682 |
Stockholders’ equity | ||
Ordinary shares, $0.01 par value, 100,000,000 shares authorized, 42,004,100 and 36,635,362 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively | 419 | 365 |
Additional paid-in capital | 312,715 | 203,842 |
Accumulated deficit | (51,376) | (45,766) |
Accumulated other comprehensive loss | (12,355) | (2,877) |
Total stockholders’ equity | 249,403 | 155,564 |
Total liabilities and stockholders’ equity | $ 278,808 | $ 173,246 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 178 | $ 100 |
Ordinary shares, par value | $ 0.01 | $ 0.01 |
Ordinary shares, authorized | 100,000,000 | 100,000,000 |
Ordinary shares, issued | 42,004,100 | 36,635,362 |
Ordinary shares, outstanding | 42,004,100 | 36,635,362 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Income Statement [Abstract] | |||
Revenues | $ 27,118 | $ 7,670 | |
Operating costs and expenses | |||
Cost of revenues | [1] | 8,719 | 1,692 |
Sales and marketing | 4,101 | 863 | |
Product and technology | 5,243 | 1,024 | |
General and administrative | [1] | 10,009 | 2,391 |
Depreciation and amortization | 3,994 | 853 | |
Total operating costs and expenses | 32,066 | 6,823 | |
Operating income (loss) | (4,948) | 847 | |
Interest expense, net | 1 | 8 | |
Income (loss) before income taxes | (4,949) | 839 | |
Income tax provision | 661 | 145 | |
Net income (loss) | $ (5,610) | $ 694 | |
Income (loss) per share | |||
Basic | $ (0.13) | $ 0.03 | |
Diluted | $ (0.13) | $ 0.03 | |
Weighted average ordinary shares outstanding | |||
Basic | 41,986,083 | 21,512,225 | |
Diluted | 41,986,083 | 23,040,345 | |
[1] | Excludes depreciation and amortization |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Net income (loss) | $ (5,610) | $ 694 |
Other comprehensive loss, net of tax | ||
Foreign currency translation adjustments | (9,478) | (1,320) |
Comprehensive loss | $ (15,088) | $ (626) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Equity(Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 215 | $ 40,862 | $ (23,024) | $ (2,908) | $ 15,145 |
Begning Balance, shares at Dec. 31, 2019 | 21,486,059 | ||||
Net income | 694 | 694 | |||
Share-based compensation expense | 295 | 295 | |||
Issuance of ordinary shares upon exercise of stock options | $ 1 | 86 | 87 | ||
Issuance of ordinary shares upon exercise of stock options, shares | 64,908 | ||||
Foreign currency translation adjustments | (1,320) | (1,320) | |||
Ending balance, value at Mar. 31, 2020 | $ 216 | 41,243 | (22,330) | (4,228) | 14,901 |
Ending balance, shares at Mar. 31, 2020 | 21,550,967 | ||||
Beginning balance, value at Dec. 31, 2020 | $ 365 | 203,842 | (45,766) | (2,877) | 155,564 |
Begning Balance, shares at Dec. 31, 2020 | 36,635,362 | ||||
Net income | (5,610) | (5,610) | |||
Share-based compensation expense | 1,632 | 1,632 | |||
Issuance of ordinary shares upon exercise of stock options | $ 1 | 314 | $ 315 | ||
Issuance of ordinary shares upon exercise of stock options, shares | 108,222 | 108,222 | |||
Issuance of ordinary shares as partial consideration in Coolbet acquisition (Note 5) | $ 53 | 106,630 | $ 106,683 | ||
Issuance of ordinary shares as partial consideration in Coolbet acquisition, shares | 5,260,516 | ||||
Fair value of replacement equity awards issued as consideration in Coolbet acquisition (Note 5) | 297 | 297 | |||
Foreign currency translation adjustments | (9,478) | (9,478) | |||
Ending balance, value at Mar. 31, 2021 | $ 419 | $ 312,715 | $ (51,376) | $ (12,355) | $ 249,403 |
Ending balance, shares at Mar. 31, 2021 | 42,004,100 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash Flows From Operating Activities | ||
Net income (loss) | $ (5,610) | $ 694 |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Amortization of software and intangible assets | 3,755 | 792 |
Depreciation on property and equipment and finance lease right-of-use assets | 239 | 61 |
Share-based compensation expense | 1,632 | 295 |
Other | 99 | 31 |
Changes in operating assets and liabilities, net of acquisition: | ||
Accounts receivable | (5,334) | (3,047) |
Prepaid expenses and other current assets | (919) | (386) |
Other assets | 97 | 1,055 |
Accounts payable | (2,093) | (567) |
Accrued compensation and benefits | (43) | 598 |
Accrued expenses | 1,528 | (64) |
Liabilities to users | 1,808 | |
Other liabilities | 305 | (901) |
Net cash used in operating activities | (4,536) | (1,439) |
Cash Flows From Investing Activities | ||
Cash paid for acquisition, net of cash acquired | (92,404) | |
Expenditures for capitalized software development costs | (1,762) | (534) |
Purchases of gaming licenses | (34) | |
Purchases of property and equipment | (426) | (437) |
Net cash used in investing activities | (94,626) | (971) |
Cash Flows From Financing Activities | ||
Payments of offering costs | (604) | (909) |
Proceeds from exercise of stock options | 315 | 87 |
Principal payments on finance leases | (44) | |
Net cash used in financing activities | (289) | (866) |
Effect of foreign exchange rates on cash | (1,018) | (850) |
Net decrease in cash | (100,469) | (4,126) |
Cash, beginning of period | 152,654 | 10,279 |
Cash, end of period | 52,185 | 6,153 |
Supplemental Disclosure of Noncash Investing and Financing Activities: | ||
Ordinary shares issued as partial consideration to acquire all the outstanding shares of Coolbet (Note 5) | 106,683 | |
Issuance of unvested stock options in exchange for unvested stock options of Coolbet (Note 5) | 297 | |
Right-of-use asset obtained in exchange for new operating lease liabilities | $ 188 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS | NOTE 1 — NATURE OF OPERATIONS GAN Limited (the “Parent,” and with its subsidiaries, collectively the “Company”) is an exempted company limited by shares, incorporated and registered in Bermuda. GAN plc, the previous parent, began its operations in the United Kingdom (“U.K.”) in 2002 and listed its ordinary shares on the AIM, the London Stock Exchange’s market for smaller companies, in 2013. In May 2020, pursuant to a statutory Scheme of Arrangement under Part 26 of U.K Companies Act of 2006 (“Scheme of Arrangement”) approved by the shareholders of GAN plc, the shareholders of GAN plc exchanged their shares in GAN plc for shares in the Parent, thereby migrating the Company’s jurisdiction of organization from the U.K. to Bermuda. Thereafter, GAN Limited became the parent company of GAN plc. GAN plc was renamed GAN (UK) Limited (“GAN UK”). The Company operates in two The Company is a B2B supplier of Internet gambling Software-as-a-Service solutions predominately to the U.S. land-based casino industry. The Company has developed a proprietary Internet gambling enterprise software system, GameSTACK™ (“GameSTACK”), which it licenses to land-based casino operators as a turnkey technology solution for regulated real money Internet gambling (“RMiG”), Internet sports gaming, and virtual simulated gaming (“SIM”). On January 1, 2021, the Company completed the acquisition of all outstanding shares of Vincent Group p.l.c., a Malta public limited company doing business as Coolbet (Note 5). Coolbet is a developer and operator of an online sports betting and casino platform. Coolbet operates a B2C casino and sports-betting platform that is accessible through its website in eight national markets across Northern Europe (Estonia, Finland, Iceland, Norway and Sweden), Latin America (Chile and Peru) and North America (Canada). |
RESTATEMENT OF PRIOR FINANCIAL
RESTATEMENT OF PRIOR FINANCIAL INFORMATION | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Changes and Error Corrections [Abstract] | |
RESTATEMENT OF PRIOR FINANCIAL INFORMATION | NOTE 2 — RESTATEMENT OF PRIOR FINANCIAL INFORMATION In connection with the preparation of the Company’s consolidated financial statements as of December 31, 2021, the Company has identified errors made in the Company’s historical condensed consolidated financial statements for the three months ended March 31, 2021. The errors primarily relate to (i) improperly capitalized costs for non-developers that did not meet the criteria of development activities in accordance with the applicable guidance and (ii) significant customization services provided during the set-up of RMiG instances, previously recognized at a point in time, which are only provided by the company and are not distinct. The related consideration should be allocated to the separately identifiable performance obligation consisting of access to the SaaS platform, recognized over time as the Company provides services to its customer in its delivery of services to the player end user. The impact of correcting the improperly capitalized costs is to reverse the capitalized costs and related amortization expense and recognize the expense within product and technology expense. The impact of correcting the revenues improperly recognized at a point in time is to reverse the revenues and recognize contract liabilities, as well as a pro-rata portion of the fixed fees as revenues for the period of the contract completed to date. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) The following table summarizes the effect of the Restatement on the condensed consolidated balance sheet as of March 31, 2021: SCHEDULE OF ERROR CORRECTIONS AND PRIOR PERIOD ADJUSTMENTS As Reported Adjustment As Restated Accounts receivable, net of allowance for doubtful accounts of $ 178 $ 11,945 $ 225 $ 12,170 Capitalized software development costs, net 8,134 (419 ) 7,715 Total assets 279,002 (194 ) 278,808 Other current liabilities 3,944 (211 ) 3,733 Other noncurrent liabilities 559 1,160 1,719 Total liabilities 28,456 949 29,405 Accumulated deficit (50,230 ) (1,146 ) (51,376 ) Accumulated other comprehensive loss (12,358 ) 3 (12,355 ) Total stockholders’ equity 250,546 (1,143 ) 249,403 Total liabilities and stockholders’ equity 279,002 (194 ) 278,808 The following table summarizes the effect of the Restatement on the condensed consolidated statement of operations for the three months ended March 31, 2021: As Reported Adjustment As Restated Revenue $ 27,842 $ (724 ) $ 27,118 Product and technology 4,850 393 5,243 General and administrative (1) 10,011 (2 ) 10,009 Depreciation and amortization 3,963 31 3,994 Total operating costs and expenses 31,644 422 32,066 Operating loss (3,802 ) (1,146 ) (4,948 ) Loss before income taxes (3,803 ) (1,146 ) (4,949 ) Net loss (4,464 ) (1,146 ) (5,610 ) Loss per share, basic and diluted $ (0.11 ) $ (0.02 ) $ (0.13 ) (1) Excludes depreciation and amortization The following table summarizes the effect of the Restatement on the condensed consolidated statement of cash flows for the three months ended March 31, 2021: As Reported Adjustment As Restated Net loss $ (4,464 ) $ (1,146 ) $ (5,610 ) Amortization of software and intangible assets 3,724 31 3,755 Accounts receivable (5,109 ) (225 ) (5,334 ) Other liabilities (644 ) 949 305 Net cash used in operating activities (4,145 ) (391 ) (4,536 ) Expenditures for capitalized software development costs (2,153 ) 391 (1,762 ) Net cash used in investing activities (95,017 ) 391 (94,626 ) GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | NOTE 3 — BASIS OF PRESENTATION Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission for interim reporting. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect all adjustments, in the opinion of management, of a normal recurring nature that are necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. The financial data and other financial information disclosed in these notes to the condensed consolidated financial statements related to these periods are also unaudited. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results that may be expected for the year ended December 31, 2021 or for any future annual or interim period. The condensed consolidated balance sheet as of December 31, 2020 included herein was derived from the audited consolidated financial statements as of that date. The accompanying unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. Share Exchange and Reorganization On May 5, 2020, GAN Limited completed a share exchange and reorganization pursuant to a Scheme of Arrangement, whereby the shareholders of GAN plc agreed to exchange their ordinary shares on a basis of four 2,525 2,004 2.32 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 4 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company’s significant accounting policies included in “Note 3 – Summary of Significant Accounting Policies” of its Annual Report on Form 10-K for the year ended December 31, 2020. In addition to repeating some of these significant accounting policies, the Company has added significant accounting policies during the three months ended March 31, 2021 below. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Due to the inherent uncertainties involved in making estimates, actual results could differ from the original estimates, and may require significant adjustments to these reported balances in the future periods. Principles of Consolidation The condensed consolidated financial statements include the results of the Parent and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Foreign Currency Translation and Transactions The Company’s reporting currency is the U.S. Dollar while the Company’s foreign subsidiaries use their local currencies as their functional currencies. The assets and liabilities of foreign subsidiaries are translated to U.S. Dollars based on the current exchange rate prevailing at each reporting period. Revenue and expenses are translated into U.S. Dollars using the average exchange rates prevailing for each period presented. Translation adjustments that arise from translating a foreign subsidiary’s financial statements from their functional currency to U.S. Dollars are reported as a separate component of accumulated other comprehensive loss in stockholders’ equity. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) Gains and losses arising from transactions denominated in a currency other than the functional currency are included in general and administrative expense in the condensed consolidated statements of operations as incurred. Foreign currency transaction and remeasurement gains and losses were a net loss of $ 9,478 1,320 Risks and Uncertainties – COVID-19 The novel coronavirus (“COVID-19”) pandemic, which was declared a national emergency in the United States in March 2020, continues to create extensive disruptions to the United States and global economic conditions and financial markets and to businesses and the lives of individuals throughout the world. Federal and state governments have taken, and continue to take, unprecedented actions to contain the spread of the disease, including quarantines, travel bans, shelter-in-place orders, closures of businesses and schools, fiscal stimulus, and legislation designed to deliver monetary aid and other relief for businesses and individuals impacted by the pandemic. Although the Company’s business has proven resilient during the pandemic (for example, with closures of land-based casinos shifting increased revenue to the Company’s online iGaming offerings), it is uncertain whether this trend will continue, as the economic disruption and uncertainty caused by COVID-19 may cause a general decline in iGaming and gambling in general over time and therefore, the impact of COVID-19 on the Company’s business is ongoing. The cancellation of certain sporting events has reduced sports betting transactions and it is uncertain when the number of live sporting events will return to pre-pandemic levels. Any of these consequences may adversely impact player activity on the Company’s platforms, which would negatively impact the business. As part of the preparation of these condensed consolidated financial statements, the Company has considered the impact of COVID-19 on the accounting policies and judgments and estimates. Significant uncertainties exist concerning the magnitude of impact and duration of the COVID-19 pandemic. Management and the Board of Directors are monitoring the impacts of COVID-19 on the Company’s operations and have not identified any major operational challenges through the date of issuance of these condensed consolidated financial statements. The Company has not experienced significant impacts to its liquidity to date as a result of COVID-19. COVID-19 may impact the Company’s ability to access capital to the extent it effects the U.S capital markets. The Company has assessed the extent to which the COVID-19 has impacted events after the reporting date and has not identified additional items to disclose as a result. Revenue Recognition Platform and Content Fees The Company’s platform and content revenues are generated primarily from its Internet gambling Software-as-a-Service (“SaaS”) platform, GameSTACK, that its customers use to provide real money and simulated Internet gaming, and online sports betting. The Company enters into service agreements with its customers, that generally range from three to five years , and includes renewal provisions, under which it charges fees based on a percentage of the operator’s net gaming revenue or net sports win at the time of settlement of an event for real money gaming, considered usage-based fees, or at the time of purchase for in-game virtual credit for simulated gaming. Further, the Company generates revenues from the licensing of proprietary and third-party branded games (collectively “content licensing services”) hosted on the platform. The Company’s promise to provide the RMiG SaaS platform and content licensing services on the hosted software is a single performance obligation. This performance obligation is recognized over time, as the Company provides services to its customer in its delivery of services to the player end user. The Company’s customers simultaneously receive and consume the benefits provided by the Company as it delivers services to its customers. Usage based fees are considered variable consideration as the service is to provide unlimited continuous access to its hosted application and usage of the hosted system is primarily controlled by the player end user. The transaction price includes fixed and variable consideration and is generally due thirty days from the date of invoice. Variable consideration is allocated entirely to the period in which consideration is earned as the variable amounts relate specifically to the customer’s usage of the platform that day and allocating the usage-based fees to each day is consistent with the allocation objective, primarily that the change in amounts reflect the changing value to the customer. Purchases of virtual credits within a transaction period on the SIM platform, generally a monthly convention, are earned at a point in time, upon the close of the respective period as the credit has no monetary value, cannot be redeemed, exchanged, transferred or withdrawn, represents solely a device for tracking game play during the month, does not obligate the Company to provide future services and the arrangements with the customer and player end user have no substantive termination penalty. In certain service agreements with SIM customers, the Company receives the fees for in-game virtual credit purchases made by end-user players and remits payment to the SIM casino operator (customer) for their share of the SIM revenues generated from the Company’s platform. At March 31, 2021 and December 31, 2020, the Company has recorded a liability of $ 2,486 and $ 2,520 , respectively, for its customers’ share of the fees within other current liabilities in the condensed consolidated balance sheets. The Company’s RMiG and SIM enterprise software platform offerings include iGaming content licensing services. The GameSTACK platform is capable of supporting, and is available to the customer, for both proprietary and third-party licensed gaming content. The customer, in this case the casino operator, generally controls the determination of which gaming content will be offered in their online casinos. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) A customer can utilize the Company’s proprietary or licensed gaming content, or a customer can direct the Company to procure third-party gaming content on its behalf. The Company has determined it acts as the principal for providing the content licensing services when the Company controls the gaming content, and therefore presents the revenue on a gross basis in the consolidated statements of operations. When the customer directs the Company to procure third-party gaming content, the Company determined it is deemed an agent for providing the content licensing services, and therefore, records the revenue, net of licensing costs paid to the suppliers of that gaming content, in the consolidated statements of operations. Gaming The Company operates the B2C gaming site www.Coolbet.com outside of the United States, which is built on proprietary software and includes the following product offerings: sportsbook, poker, casino, live casino and virtual sports. The Company manages an online sportsbook allowing users to place various types of wagers on the outcome of sporting events conducted around the world. The Company operates as the bookmaker and offers multiple odds-scenarios-based wagering on events. When a user’s wager wins, the Company pays the user a pre-determined amount known as fixed odds. Revenue from sportsbook is reported net after deduction of player winnings and bonuses. Revenue from wagers is recognized when the outcome of the event is known. The Company offers live casino through its digital online casino offering in select markets, allowing users to place a wager and play games virtually at retail casinos. The Company offers users a catalog of over 1,600 Peer-to-peer poker offerings allow users to play poker against one another on the Company’s online poker platform for prize money. Revenue from poker is reported at rake, less tournament costs and customer bonuses. In each of the online gaming products, a single performance obligation exists at the time a wager is made to operate the games and award prizes or payouts to users based on a particular outcome. Revenue is recognized at the conclusion of each contest, wager, or wagering game hand. Additionally, certain incentives given to users, for example, that allow the user to make an additional wager at a reduced price, may provide the user with a material right which gives rise to a separate performance obligation. Such user incentives are recognized as revenue upon redemption or when the incentive expires. Development Services Gaming Development Services Revenue is generated from fees for development of games for use on its RMiG and SIM platforms. The development revenue is recognized at the point in time when control of the game is transferred, typically the earlier of the customer’s acceptance or upon receipt of the certification of the game. Platform Development Services Platform development services consist of fees charged for ongoing development services to provide updates to the RMiG platforms for enhanced functionality or customization. Ongoing platform development services are typically billed monthly, at a daily rate, for services performed. Revenue from RMiG platform development services are considered additional distinct promises to the customer as they access the platform in a single-tenant architecture, the added features provide new, discrete capabilities independent of the original features and provide independent value to the customer. Revenue is recognized over time as the Company performs the services. For development services charged at a daily rate, revenue is measured using an input method based on effort expended, which uses direct labor hours incurred. As the performance obligations in these instances relate to the provision of development services over time, this method best reflects the transfer of control as the Company performs. In contracts that require a portion of the consideration to be received in advance, at the commencement of the contract, such advance payment is initially recorded as a contract liability. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) Computer Hardware Sales The Company resells third-party hardware, such as computing servers and other technical devices, upon which the GameSTACK software platform is installed for its customers. These products are not required to be purchased in order to access the GameSTACK platform but are sold as a convenience to the customer. Revenue is recognized at the point in time when control of the hardware transfers to the customer. Control is transferred after the hardware has been procured, delivered, installed at the client’s premises and configured to allow for remote access. The Company has determined that it is acting as the principal in these transactions as it takes responsibility for procuring, delivering, installing and configuring the hardware at the customer’s location and takes control of the hardware, prior to transfer. Revenue is presented at the gross amount of consideration to which it is entitled from the customer in exchange for the hardware. Patent Licensing Revenue The Company generates revenue from time to time from the licensing of its U.S. patent, which governs the linkage of on-property reward cards to their counterpart Internet gambling accounts together with bilateral transmission of reward points between the Internet gambling technology system and the land-based casino management system present in all U.S casino properties. The nature of the promise in transferring the license is to provide a right to use the patent as it exists. The Company does not have to undertake activities to change the functionality of the patent during the license period and the license has significant stand-alone functionality. Therefore, the Company recognizes the revenue from the license of the patent, at the point in time when control of the license is transferred to the customer. Control is determined to transfer at the point in time the customer is able to use and benefit from the license. Contracts with Multiple Performance Obligations For customer contracts that have more than one performance obligation, the transaction price is allocated to the performance obligations in an amount that depicts the relative stand-alone selling prices of each performance obligation. Judgment is required in determining the stand-alone selling price for each performance obligation. In determining the allocation of the transaction price, an entity is required to maximize the use of observable inputs. When the stand-alone selling price of a good or service is not directly observable, an entity is required to estimate the stand-alone selling price. Customer contracts can include platform and content services as well as development services or hardware sales. The variable consideration is allocated entirely to the performance obligation for platform and content services as the variable consideration is allocable specifically to the delivery of the services in the period and the allocation is consistent with the allocation objective. For gaming, the Company allocates a portion of the user’s wager to incentives that create material rights that are redeemed or expired in the future. The allocated revenue for gaming wagers is primarily recognized when the wagers occur because all such wagers settle immediately. The Company applies a practical expedient by accounting for revenue from gaming on a portfolio basis because such wagers have similar characteristics, and the Company reasonably expects the effects on the financial statements of applying the revenue recognition guidance to the portfolio to not differ materially from that which would result if applying the guidance to an individual wagering contract. Cash The Company is required to maintain compensating cash balances to satisfy its liabilities to users. Such balances are included within cash on the condensed consolidated balance sheets and are not subject to creditor claims. At March 31, 2021 the related liabilities to users was $ 6,916 . Goodwill Goodwill represents the excess of the fair value of the consideration transferred over the estimated fair values of the identifiable assets acquired and liabilities assumed on the acquisition date. As disclosed in Note 5, the Company has recorded goodwill in connection with the acquisition of Coolbet on January 1, 2021. Goodwill is not amortized, but rather is reviewed for impairment annually or more frequently if facts or circumstances indicate that the carrying value may not be recoverable. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) The Company has determined that there are two If the quantitative impairment test for goodwill is deemed necessary, this quantitative impairment analysis compares the fair value of the Company’s reporting unit to its related carrying value. If the fair value of the reporting unit is less than its carrying amount, goodwill is written down to the fair value and an impairment loss is recognized. If the fair value of the reporting unit exceeds its carrying amount, no further analysis is required. Fair value of the reporting unit is determined using valuation techniques, primarily using discounted cash flow analysis. The Company will perform its annual impairment review of goodwill as of October 1 st Long-lived Assets Long-lived assets, except goodwill, consist of property and equipment, and finite lived acquired intangible assets, such as developed software, gaming licenses, trademarks, trade names and customer relationships. Intangible assets are amortized on a straight-line basis over their estimated useful lives. The Company considers the period of expected cash flows and underlying data used to measure the fair value of the intangible assets when selecting the estimated useful lives. The fair value of the acquired intangible assets is primarily determined using the income approach. In performing these valuations, the Company’s key underlying assumptions used in the discounted cash flows were projected revenue, gross margin expectations and operating cost estimates. There are inherent uncertainties and management judgment required in these valuations. Acquired in-process technology consists of a proprietary technical platform. The Company reviews the in-process technology for impairment at least annually or more frequently if an event occurs creating the potential for impairment, until such time as the in-process technology efforts are completed. When completed, the developed technology will be amortized over its estimated useful life based on and using amortization methods that reflect the pattern in which the economic benefits of the intangible assets are consumed or otherwise realized. The technology is expected to be completed in the latter part of 2021. Long-lived assets, except goodwill, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company compares the undiscounted cash flows expected to be generated by that asset or asset group to their carrying amount. If the carrying amount of the long-lived asset or asset group are not recoverable on an undiscounted cash flow basis, an impairment charge is recognized to the extent that the carrying amount exceeds fair value. Fair value is determined through various techniques, such as discounted cash flow models using probability weighted estimated future cash flows and the use of valuation specialists. Capitalized Software Development Costs, net The Company capitalizes certain development costs related to its software platforms during the application development stage. Costs associated with preliminary project activities, training, maintenance and all other post implementation stage activities are expensed as incurred. Software development costs are capitalized when application development begins, it is probable that the project will be completed, and the software will be used as intended. The Company capitalizes certain costs related to specific upgrades and enhancements when it is probable that expenditures will result in additional functionality of the platform to its customers. The capitalization policy provides for the capitalization of certain payroll and payroll related costs for employees who spent time directly associated with development and enhancements of the software platform. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) Capitalized software development costs are amortized on a straight-line basis over their estimated useful lives, which is generally three years Liabilities to Users The Company records liabilities for user account balances. User account balances consist of user deposits, promotional awards and user winnings less user withdrawals and user losses. Share-based Compensation Share-based compensation expense is recognized for equity-settled stock options and restricted stock issued to employees and non-employee members of the Company’s Board of Directors based on the fair value of these awards on the date of grant. The fair value of the stock options is estimated using a Black-Scholes option pricing model and the fair value of the restricted stock awards (restricted stock and restricted stock units) is based on the market price of the Company’s stock on the date of grant. Share-based compensation is recorded over the requisite service period, generally defined as the vesting period. For awards with graded vesting and only service conditions, compensation cost is recorded on a straight-line basis over the requisite service period of the entire award. Forfeitures are recorded in the period in which they occur. Income (Loss) Per Share, Basic and Diluted Basic income (loss) per share is calculated by dividing net income (loss) by the weighted average number of ordinary shares outstanding during the year. In periods of income, diluted income per share is calculated by dividing net income by the weighted average number of ordinary shares outstanding during the year plus the assumed conversion of all potential dilutive ordinary shares. The Company determines the potentially dilutive ordinary shares using the treasury stock method. In periods of a net loss, basic and dilutive ordinary shares would be anti-dilutive. Reclassifications of Prior Period Amounts Certain prior period amounts have been reclassified to conform to the current period presentation. Specifically, the due to the Coolbet acquisition in 2021, the Company has reclassified certain balances that were previously presented in separate balance sheet captions to other current and noncurrent assets, other accrued expenses, and other current and noncurrent liabilities in the condensed consolidated balance sheet as of December 31, 2020. These reclassifications had no impact on previously disclosed current assets, current liabilities, total assets and total liabilities. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) |
ACQUISITION OF VINCENT GROUP P.
ACQUISITION OF VINCENT GROUP P.L.C. | 3 Months Ended |
Mar. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITION OF VINCENT GROUP P.L.C. | NOTE 5 — ACQUISITION OF VINCENT GROUP P.L.C. On January 1, 2021, the Company completed the acquisition of all outstanding shares of Vincent Group p.l.c. (“Coolbet”). Coolbet is a developer and operator of an online sports betting and casino platform. Coolbet operates a B2C casino and sports-betting platform that is accessible through its website in eight national markets across Northern Europe (Estonia, Finland, Iceland, Norway and Sweden), Latin America (Chile and Peru) and North America (Canada). The Company acquired Coolbet to take advantage of Coolbet’s user interface and proprietary technical platform, to quickly integrate and offer a proprietary sportsbook offering to land-based casino operators in the United States. The Company intends to continue to operate in the United States solely as a B2B provider to casinos and other operators. The addition of a proprietary sports betting engine will give the Company the ability to offer a “one-stop” solution to U.S. retail casino operators, while at the same time preserving the flexibility to incorporate third-party solutions when specified. The Company expects that its technology platform and expansive library of proprietary and third-party gaming content should enable it to add additional casino gaming content and platform support for the Company’s B2C offering in Europe and Latin America. The following table summarizes the consideration transferred and the recognized amounts of identifiable assets acquired and liabilities assumed at the acquisition date: Fair value of the consideration transferred: SUMMARY OF CONSIDERATION TRANSFERRED Cash paid to Vincent Group shareholders $ 111,118 Restricted ordinary shares issued to Vincent Group shareholders (1) 106,683 Replacement equity-based awards to holders of Vincent Group equity-based awards (2) 297 Total $ 218,098 (1) The share consideration represents 5,260,516 20.28 (2) The replacement equity-based awards consist of options to purchase 67,830 Recognized amounts of identifiable assets acquired and liabilities assumed at fair value: SUMMARY OF FAIR VALUES OF ASSETS ACQUIRED AND LIABILITIES ASSUMED Cash $ 18,714 Prepaid expenses and other current assets 1,512 Property and equipment 343 Operating lease right-of-use assets 416 Intangible assets 48,370 Other noncurrent assets 73 Accounts payable (1,182 ) Liabilities to users (5,373 ) Other current liabilities (1,797 ) Operating lease liabilities (167 ) Deferred income taxes (2,265 ) Noncurrent operating lease liabilities (231 ) Total identifiable net assets 58,413 Goodwill 159,685 Total identifiable assets acquired and liabilities assumed including goodwill, net $ 218,098 Identifiable intangible assets acquired as part of the acquisition, including their respective expected useful lives, were as follows: SUMMARY OF INTANGIBLE ASSETS ACQUIRED Estimated useful life (in years) Fair Value Trade names and trademarks 10.0 $ 5,800 Developed technology 3.0 28,100 In-process developed technology — 8,400 Customer relationships 3.0 5,600 Licenses various 470 $ 48,370 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) The Company has not yet finalized the purchase price allocation, which is pending further analysis of the net assets acquired. The above cash consideration is subject to adjustment for the final working capital adjustment. Additionally, the Company is continuing to evaluate the tax impacts related to the acquisition. Accordingly, the purchase price allocation shown above could change materially. The Company recorded a net deferred income tax liability of $ 2,265 The Company accounted for the acquisition of Coolbet using the acquisition method. The acquisition is treated as a stock purchase for accounting purposes. The goodwill is primarily attributable to the expected incremental revenue and profit to be derived from the Company’s introduction of Coolbet’s sports betting engine technology and intellectual technology to B2B customers in the United States and the assembled workforce of Coolbet. The Company intends to offer the Coolbet sports betting engine and associated capability to existing and new customers alongside its existing platform and Internet casino capability, as a complete turnkey solution or as an alternative sports betting engine to those currently relied upon by customers. Goodwill is not amortized, but is reviewed for impairment at least annually or if an event occurs or circumstances change that would more likely than not indicate the goodwill could be impaired. Goodwill recognized in the acquisition is not deductible for tax purposes. Goodwill arising from the acquisition has been preliminary assigned as of the acquisition date to the Company’s B2C and B2B segments in the amounts of $ 92,138 67,547 The Company incurred $ 1,309 290 Pro Forma Operating Results The operating results of Coolbet have been included in the condensed consolidated financial statements, beginning on January 1, 2021. The following unaudited pro forma information presents consolidated financial information as if the Coolbet acquisition had occurred on January 1, 2020. The unaudited pro forma results reflect certain adjustments related to the acquisition, such as amortization expense resulting from the intangible assets acquired, share-based compensation related to unvested replacement awards and an adjustment to reflect the Company’s income tax rate. Acquisition costs of $ 1,309 PRO FORMA OPERATING RESULTS Three Months Ended Revenues $ 14,815 Net loss $ (2,811 ) Loss per share – basic and diluted $ (0.10 ) |
CAPITALIZED SOFTWARE DEVELOPMEN
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET | 3 Months Ended |
Mar. 31, 2021 | |
Research and Development [Abstract] | |
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET | NOTE 6 — CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET Capitalized software development costs, net at March 31, 2021 and December 31, 2020 consisted of the following: SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET March 31, 2021 December 31, 2020 (Restated) Capitalized software development costs $ 27,074 $ 26,507 Development in progress 3,127 2,641 Total capitalized software development costs 30,201 29,148 Less: accumulated amortization (22,486 ) (22,500 ) Total $ 7,715 $ 6,648 At March 31, 2021, development in progress primarily represents costs associated with new content and enhancements to the software platform, as well as integration of Coolbet’s sportsbook into the B2B platform, which are expected to be fully placed in service by the end of 2021. Amortization expense related to capitalized software development costs was $ 760 756 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | NOTE 7 — GOODWILL AND INTANGIBLE ASSETS Goodwill The changes in the carrying amount of goodwill, by segment, for the three months ended March 31, 2021 were as follows: SCHEDULE OF GOODWILL B2B B2C Total Balance at December 31, 2020 $ — $ — $ — Goodwill acquired in Coolbet acquisition 67,547 92,138 159,685 Effect of foreign currency translation (2,941 ) (4,010 ) (6,951 ) Balance at March 31, 2021 $ 64,606 $ 88,128 $ 152,734 Intangible Assets Definite-lived intangible assets, net consisted of the following: SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS March 31, 2021 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology 3.0 $ 26,877 $ (2,240 ) $ 24,637 In-process technology — 8,034 — 8,034 Customer relationships 3.0 5,356 (446 ) 4,910 Trade names and trademarks 10.0 5,898 (486 ) 5,412 Licenses 6.7 1,860 (998 ) 862 $ 48,025 $ (4,170 ) $ 43,855 December 31, 2020 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade names and trademarks 3.0 $ 343 $ (343 ) $ — Licenses 5.3 1,366 (898 ) 468 $ 1,709 $ (1,241 ) $ 468 Amortization expense related to intangible assets was $ 2,995 36 8,636 11,500 11,481 639 625 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) |
ACCRUED EXPENSES
ACCRUED EXPENSES | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | NOTE 8 — ACCRUED EXPENSES Accrued expenses consisted of the following: SCHEDULE OF ACCRUED EXPENSES March 31, 2021 December 31, 2020 Content licensing fees $ 2,103 $ 1,984 Sales taxes 929 756 Income taxes 890 17 Other 492 606 Total $ 4,414 $ 3,363 |
OTHER CURRENT LIABILITIES
OTHER CURRENT LIABILITIES | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
OTHER CURRENT LIABILITIES | NOTE 9 — OTHER CURRENT LIABILITIES Other current liabilities consisted of the following: SCHEDULE OF OTHER CURRENT LIABILITIES March 31, 2021 December 31, 2020 (Restated) Revenue share due to SIM customers $ 2,486 $ 2,520 Contract liabilities 680 1,083 Operating lease liabilities 465 262 Other 102 202 Total $ 3,733 $ 4,067 Revenue share due to SIM customers represents the fees collected for in-game virtual credit purchases made by end-user players due to SIM casino operator customers for their share of the SIM revenues generated from the Company’s platform. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | NOTE 10 — SHARE-BASED COMPENSATION In April 2020, the Board of Directors established the GAN Limited 2020 Equity Incentive Plan (“2020 Plan”) which has been approved by the shareholders. The 2020 Plan provides for grants of up to 4,400,000 4 st 726,581 Stock Options Stock option awards are granted with an exercise price equal to the fair market value, as determined under the 2020 Plan, of the Company’s ordinary shares on the date of grant. Stock option awards generally vest 25 ten years During the three months ended March 31, 2021, the Board of Directors approved the issuance of options to purchase 1,148,310 In addition, in accordance with the acquisition agreement, the Company issued 67,830 one three years GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) A summary of the stock option activity as of and for the three months ended March 31, 2021 is as follows: SCHEDULE OF SHARE-BASED COMPENSATION, OPTION ACTIVITY Number of Shares Weighted Average Exercise Price Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2020 3,061,859 $ 8.06 8.5 $ 37,410 Granted 1,216,140 24.35 Exercised (108,222 ) 2.40 Forfeited/expired or cancelled (3,080 ) 18.53 Outstanding at March 31, 2021 4,166,697 $ 12.96 9.2 $ 21,840 Options exercisable at March 31, 2021 1,820,667 $ 3.08 7.7 $ 27,524 The Company recorded share-based compensation expense related to stock-options of $ 1,139 and $ 295 for the three months ended March 31, 2021 and 2020, respectively. Such share-based compensation expense is recorded net of capitalized software development costs of $ 48 and $ 23 during the three months ended March 31, 2021 and 2020, respectively. At March 31, 2021, there was $ 22,945 of total unrecognized compensation cost related to nonvested stock options granted under the 2020 Plan. The unrecognized compensation cost is expected to be recognized over a weighted-average period of 3.6 years. The grant date fair value of each stock option grant was determined using the following weighted average assumptions: SCHEDULE OF SHARE- BASED COMPENSATION, FAIR VALUE ASSUMPTIONS Three Months Ended 2021 2020 Expected stock price volatility 61.50 % 67.60 % Expected term (in years) 4.95 5.00 Risk-free interest rate 0.72 % 0.44 % Dividend yield 0 % 0 % The weighted average grant date fair value of options granted was $ 12.86 4.72 Expected volatility is determined by reference to volatility of certain identified peer group share trading information and stock prices on the Nasdaq. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. For the three months ended March 31, 2020 (prior to the Company’s initial public offering in May 2020), expected volatility was determined by reference to the historic volatility of GAN UK’s share price on the AIM, the London Stock Exchange. The risk-free interest rate for the expected term of the option was based on the U.K. Gilt yield curve in effect at the time of grant. The expected term of the options is based on historical data and represents the period of time that options granted are expected to be outstanding. In addition, in 2020, the Company recorded a liability for social taxes and income taxes related to certain unexercised legacy U.K. Enterprise Management Incentive regime options. The Company is accounting for the required cash payment as a cash-settled share-based compensation transaction. The company recorded a decrease of $ 93 Restricted Stock Units On March 9, 2021, the Board of Directors approved the issuance of 15,537 one year 25 25.10 25 365 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) Restricted Stock Awards On June 15, 2020, the Board of Directors approved the issuance of 93,680 one year 18.19 420 350 |
INCOME (LOSS) PER SHARE
INCOME (LOSS) PER SHARE | 3 Months Ended |
Mar. 31, 2021 | |
Income (loss) per share | |
INCOME (LOSS) PER SHARE | NOTE 11 — INCOME (LOSS) PER SHARE Basic income (loss) per ordinary share is computed by dividing net income (loss) by the weighted average number of ordinary shares outstanding during the period. Diluted income per ordinary share further includes any ordinary shares available to be issued upon the exercise of outstanding stock option and restricted stock awards if such inclusions would be dilutive. The Company determines the potentially dilutive ordinary shares using the treasury stock method. The following table sets forth the computation of basic and diluted income (loss) per share for the three months ended March 31, 2021 and 2020: SCHEDULE OF THE COMPUTATION OF EARNINGS PER SHARE BASIC AND DILUTED 2021 2020 Three Months Ended March 31, 2021 2020 (Restated) Numerator: Net income (loss) $ (5,610 ) $ 694 Denominator: Weighted average ordinary shares outstanding, basic 41,986,083 21,512,225 Weighted average effect of potentially dilutive ordinary shares: Stock options — 1,528,120 Restricted stock awards — — Restricted stock units — — Weighted average ordinary shares outstanding, diluted 41,986,083 23,040,345 Income (loss) per share: Basic $ (0.13 ) $ 0.03 Diluted $ (0.13 ) $ 0.03 Certain stock options, nonvested restricted stock awards and restricted stock units were excluded from the computation of diluted weighted average ordinary shares outstanding, as inclusion would be anti-dilutive, are summarized as follows: SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE 2021 2020 Three Months Ended March 31, 2021 2020 Stock options 4,166,697 — Restricted stock awards 93,680 — Restricted stock units 15,537 — Total 4,275,914 — GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) |
REVENUES
REVENUES | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
REVENUES | NOTE 12 — REVENUES The following table reflects revenues recognized for the three months ended March 31, 2021 and 2020 in line with the timing of transfer of services SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES 2021 2020 Three Months Ended March 31, 2021 2020 (Restated) Revenues from services delivered at a point in time $ 17,312 $ — Revenues from services delivered over time 9,806 7,670 Total $ 27,118 $ 7,670 During the three months ended March 31, 2021, revenues recognized at a point in time was $ 17,312 14,312 3,000 During the three months ended March 31, 2021, the Company had two customers which individually generated revenue greater than 10% 3,995 3,633 28.1 4,348 56.7 Costs to Obtain a Contract The Company defers contract costs that are recoverable and incremental to obtaining sales contracts with its customers. Contract costs, consisting primarily of sales commissions, are amortized on a systemic basis that is consistent with the transfer to the customer of the services to which the asset relates. Contract costs are periodically reviewed for impairment. An impairment exists if the carrying amount of the asset exceeds the amount of the consideration the entity expects to receive in exchange for providing the services, less the remaining costs that relate directly to providing those services. Deferred contract costs are recorded in other current assets and other assets in the condensed consolidated balance sheets. The following table reflects the activity in deferred contract costs for the periods presented: SCHEDULE OF ACTIVITY IN CONTRACT LIABILITIES 2021 2020 Three Months Ended March 31, 2021 2020 Balance at the beginning of the period $ 353 $ 86 Capitalized expenditures for the period 52 0 Amortization (22 ) (2 ) Effect of foreign currency translation 2 (6 ) Balance at the end of the period $ 385 $ 78 Contract and Contract-Related Liabilities The Company has four types of liabilities related to contracts with customers: (i) cash consideration received in advance from customers related to development services not yet performed or hardware deliveries not yet completed (ii) incentive program obligations, which represents the deferred allocation of revenue relating to incentives in the online gaming operations (iii) user balances, which are funds deposited by customers before gaming play occurs and (iv) unpaid winnings and wagers contributions to jackpot. Contract-related liabilities are expected to be recognized as revenue within one year of being purchased, earned or deposited. Such liabilities are recorded in Liabilities to Users and Other Current Liabilities on the condensed consolidated balance sheets. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) The following table reflects contract liabilities arising from cash consideration received in advance from customers for the periods presented: SCHEDULE OF CONTRACT WITH CUSTOMERS Three Months Ended March 31, 2021 2020 (Restated) Contract liabilities from advance customer payments, beginning of the period $ 1,083 $ 3,023 Contract liabilities from advance customer payments, end of the period 1,840 2,095 Revenue recognized from amounts included in contract liabilities from advance customer payments at the beginning of the period 57 777 At March 31, 2021, the Company recorded contract liabilities from advance customer payments of $ 680 1,160 |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | NOTE 13 — SEGMENT REPORTING Prior to January 1, 2021, the Company operated its business and reported its results through two segments - RMiG and SIM. With the acquisition of Coolbet on January 1, 2021, the Company changed the way it operates its business and now reports its results through two segments: B2C and B2B. The financial information for the three months ended March 31, 2020 has been recast to conform to the new segment presentation. Information reported to the Company’s chief executive officer, the chief operating decision maker (“CODM”), for the purpose of resource allocation and assessment of the Company’s segmental performance is primarily focused on the origination of the revenue streams. The CODM evaluates performance and allocates resources based on the segment’s revenue and gross profit. Segment gross profit represents the gross profit earned by each segment without allocation of each segment’s share of depreciation and amortization expense, sales and marketing expense, product and technology expense, general and administrative expense, interest costs and income taxes. A description of each reportable segment is as follows: B2B Segment – This segment develops, markets and sells instances of iSight Back Office and GameSTACK technology that incorporates comprehensive player registration, account funding and back-office accounting and management tools that enable the casino operator customers to efficiently, confidently and effectively extend their presence online in places that have permitted online real money gambling. Where certain jurisdictions have not yet permitted any form of online real money gambling, these B2B technologies provide simulated gambling solutions for the Company’s casino operator customers as a way to bring their retail brand online and create a new Internet gaming experience to their players while leveraging their on-property rewards program. B2C Segment – This segment develops and operates a B2C online sports betting and casino platform accessible through its website in eight national markets across Northern Europe (Estonia, Finland, Iceland, Norway and Sweden), Latin America (Chile and Peru) and North America (Canada). Summarized financial information by reportable segments for the three months ended March 31, 2021 and 2020 is as follows: SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 B2B B2C Total B2B B2C Total (Restated) (Restated) Revenues $ 12,806 $ 14,312 $ 27,118 $ 7,670 $ — $ 7,670 Cost of revenues (1) 2,742 5,977 8,719 1,692 — 1,692 Segment gross profit (1) $ 10,064 $ 8,335 $ 18,399 $ 5,978 $ — $ 5,978 (1) Excludes depreciation and amortization GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) The following table presents a reconciliation of segment gross profit to consolidated income (loss) before income taxes for the three months ended March 31, 2021 and 2020: SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT PROFIT TO CONSOLIDATED INCOME (LOSS) BEFORE INCOME TAXES Three Months Ended March 31, 2021 2020 (Restated) Segment gross profit (1) $ 18,399 $ 5,978 Sales and marketing 4,101 863 Product and technology 5,243 1,024 General and administrative (1) 10,009 2,391 Depreciation and amortization 3,994 853 Interest expense, net 1 8 Income (loss) before income taxes $ (4,949 ) $ 839 (1) Excludes depreciation and amortization Assets and liabilities are not separately analyzed or reported to the CODM and are not used to assist in decisions surrounding resource allocation and assessment of segment performance. As such, an analysis of segment assets and liabilities has not been included in this financial information. The following table disaggregates total revenue by product and services for each segment: SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT Three Months Ended March 31, 2021 2020 (Restated) B2B: Platform and content fees $ 9,184 $ 5,933 Development services and other 3,622 1,737 Total B2B $ 12,806 $ 7,670 B2C: Sportsbook $ 7,151 $ — Casino 6,471 — Poker 690 — Total B2C $ 14,312 $ — Total revenues $ 27,118 $ 7,670 Revenue by location of the customer for the three months ended March 31, 2021 and 2020 was as follows: SCHEDULE OF DISAGGREGATION OF REVENUE BY LOCATION Three Months Ended March 31, 2021 2020 (Restated) United States $ 10,749 $ 6,251 Europe 11,064 1,410 Latin America 3,603 — Rest of the world 1,702 9 Total $ 27,118 $ 7,670 GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 14 — INCOME TAXES The provision for income taxes for the three months ended March 31, 2021 and 2020 consisted of the following: SCHEDULE OF INCOME TAX PROVISION Three Months Ended March 31, 2021 2020 Domestic (Bermuda) $ — $ — Foreign (Non-Bermuda) 661 145 Total $ 661 $ 145 The Company’s effective income tax rate was (13.4) 17.3 The difference between the statutory tax rate of 0 The acquisition of Coolbet (Note 5) did not cause a material change in the effective tax rate for the three months ended March 31, 2021 from the Company’s annual effective tax rate for the year ended December 31, 2020 because the majority of Coolbet’s earnings were generated in lower rate jurisdictions at an effective tax rate ranging from 0 5 2,265 |
CONTINGENCIES
CONTINGENCIES | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | NOTE 15 — CONTINGENCIES The Company may be subject to legal actions and claims arising from contracts or other matters from time to time in the ordinary course of business. Management is not aware of any pending or threatened litigation, which are considered other than routine legal proceedings. The Company believes that the ultimate disposition or resolution of its routine legal proceedings will not have a material adverse effect on its financial position, results of operations or liquidity. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Due to the inherent uncertainties involved in making estimates, actual results could differ from the original estimates, and may require significant adjustments to these reported balances in the future periods. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the results of the Parent and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions The Company’s reporting currency is the U.S. Dollar while the Company’s foreign subsidiaries use their local currencies as their functional currencies. The assets and liabilities of foreign subsidiaries are translated to U.S. Dollars based on the current exchange rate prevailing at each reporting period. Revenue and expenses are translated into U.S. Dollars using the average exchange rates prevailing for each period presented. Translation adjustments that arise from translating a foreign subsidiary’s financial statements from their functional currency to U.S. Dollars are reported as a separate component of accumulated other comprehensive loss in stockholders’ equity. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) Gains and losses arising from transactions denominated in a currency other than the functional currency are included in general and administrative expense in the condensed consolidated statements of operations as incurred. Foreign currency transaction and remeasurement gains and losses were a net loss of $ 9,478 1,320 |
Risks and Uncertainties – COVID-19 | Risks and Uncertainties – COVID-19 The novel coronavirus (“COVID-19”) pandemic, which was declared a national emergency in the United States in March 2020, continues to create extensive disruptions to the United States and global economic conditions and financial markets and to businesses and the lives of individuals throughout the world. Federal and state governments have taken, and continue to take, unprecedented actions to contain the spread of the disease, including quarantines, travel bans, shelter-in-place orders, closures of businesses and schools, fiscal stimulus, and legislation designed to deliver monetary aid and other relief for businesses and individuals impacted by the pandemic. Although the Company’s business has proven resilient during the pandemic (for example, with closures of land-based casinos shifting increased revenue to the Company’s online iGaming offerings), it is uncertain whether this trend will continue, as the economic disruption and uncertainty caused by COVID-19 may cause a general decline in iGaming and gambling in general over time and therefore, the impact of COVID-19 on the Company’s business is ongoing. The cancellation of certain sporting events has reduced sports betting transactions and it is uncertain when the number of live sporting events will return to pre-pandemic levels. Any of these consequences may adversely impact player activity on the Company’s platforms, which would negatively impact the business. As part of the preparation of these condensed consolidated financial statements, the Company has considered the impact of COVID-19 on the accounting policies and judgments and estimates. Significant uncertainties exist concerning the magnitude of impact and duration of the COVID-19 pandemic. Management and the Board of Directors are monitoring the impacts of COVID-19 on the Company’s operations and have not identified any major operational challenges through the date of issuance of these condensed consolidated financial statements. The Company has not experienced significant impacts to its liquidity to date as a result of COVID-19. COVID-19 may impact the Company’s ability to access capital to the extent it effects the U.S capital markets. The Company has assessed the extent to which the COVID-19 has impacted events after the reporting date and has not identified additional items to disclose as a result. |
Revenue Recognition | Revenue Recognition Platform and Content Fees The Company’s platform and content revenues are generated primarily from its Internet gambling Software-as-a-Service (“SaaS”) platform, GameSTACK, that its customers use to provide real money and simulated Internet gaming, and online sports betting. The Company enters into service agreements with its customers, that generally range from three to five years , and includes renewal provisions, under which it charges fees based on a percentage of the operator’s net gaming revenue or net sports win at the time of settlement of an event for real money gaming, considered usage-based fees, or at the time of purchase for in-game virtual credit for simulated gaming. Further, the Company generates revenues from the licensing of proprietary and third-party branded games (collectively “content licensing services”) hosted on the platform. The Company’s promise to provide the RMiG SaaS platform and content licensing services on the hosted software is a single performance obligation. This performance obligation is recognized over time, as the Company provides services to its customer in its delivery of services to the player end user. The Company’s customers simultaneously receive and consume the benefits provided by the Company as it delivers services to its customers. Usage based fees are considered variable consideration as the service is to provide unlimited continuous access to its hosted application and usage of the hosted system is primarily controlled by the player end user. The transaction price includes fixed and variable consideration and is generally due thirty days from the date of invoice. Variable consideration is allocated entirely to the period in which consideration is earned as the variable amounts relate specifically to the customer’s usage of the platform that day and allocating the usage-based fees to each day is consistent with the allocation objective, primarily that the change in amounts reflect the changing value to the customer. Purchases of virtual credits within a transaction period on the SIM platform, generally a monthly convention, are earned at a point in time, upon the close of the respective period as the credit has no monetary value, cannot be redeemed, exchanged, transferred or withdrawn, represents solely a device for tracking game play during the month, does not obligate the Company to provide future services and the arrangements with the customer and player end user have no substantive termination penalty. In certain service agreements with SIM customers, the Company receives the fees for in-game virtual credit purchases made by end-user players and remits payment to the SIM casino operator (customer) for their share of the SIM revenues generated from the Company’s platform. At March 31, 2021 and December 31, 2020, the Company has recorded a liability of $ 2,486 and $ 2,520 , respectively, for its customers’ share of the fees within other current liabilities in the condensed consolidated balance sheets. The Company’s RMiG and SIM enterprise software platform offerings include iGaming content licensing services. The GameSTACK platform is capable of supporting, and is available to the customer, for both proprietary and third-party licensed gaming content. The customer, in this case the casino operator, generally controls the determination of which gaming content will be offered in their online casinos. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) A customer can utilize the Company’s proprietary or licensed gaming content, or a customer can direct the Company to procure third-party gaming content on its behalf. The Company has determined it acts as the principal for providing the content licensing services when the Company controls the gaming content, and therefore presents the revenue on a gross basis in the consolidated statements of operations. When the customer directs the Company to procure third-party gaming content, the Company determined it is deemed an agent for providing the content licensing services, and therefore, records the revenue, net of licensing costs paid to the suppliers of that gaming content, in the consolidated statements of operations. Gaming The Company operates the B2C gaming site www.Coolbet.com outside of the United States, which is built on proprietary software and includes the following product offerings: sportsbook, poker, casino, live casino and virtual sports. The Company manages an online sportsbook allowing users to place various types of wagers on the outcome of sporting events conducted around the world. The Company operates as the bookmaker and offers multiple odds-scenarios-based wagering on events. When a user’s wager wins, the Company pays the user a pre-determined amount known as fixed odds. Revenue from sportsbook is reported net after deduction of player winnings and bonuses. Revenue from wagers is recognized when the outcome of the event is known. The Company offers live casino through its digital online casino offering in select markets, allowing users to place a wager and play games virtually at retail casinos. The Company offers users a catalog of over 1,600 Peer-to-peer poker offerings allow users to play poker against one another on the Company’s online poker platform for prize money. Revenue from poker is reported at rake, less tournament costs and customer bonuses. In each of the online gaming products, a single performance obligation exists at the time a wager is made to operate the games and award prizes or payouts to users based on a particular outcome. Revenue is recognized at the conclusion of each contest, wager, or wagering game hand. Additionally, certain incentives given to users, for example, that allow the user to make an additional wager at a reduced price, may provide the user with a material right which gives rise to a separate performance obligation. Such user incentives are recognized as revenue upon redemption or when the incentive expires. Development Services Gaming Development Services Revenue is generated from fees for development of games for use on its RMiG and SIM platforms. The development revenue is recognized at the point in time when control of the game is transferred, typically the earlier of the customer’s acceptance or upon receipt of the certification of the game. Platform Development Services Platform development services consist of fees charged for ongoing development services to provide updates to the RMiG platforms for enhanced functionality or customization. Ongoing platform development services are typically billed monthly, at a daily rate, for services performed. Revenue from RMiG platform development services are considered additional distinct promises to the customer as they access the platform in a single-tenant architecture, the added features provide new, discrete capabilities independent of the original features and provide independent value to the customer. Revenue is recognized over time as the Company performs the services. For development services charged at a daily rate, revenue is measured using an input method based on effort expended, which uses direct labor hours incurred. As the performance obligations in these instances relate to the provision of development services over time, this method best reflects the transfer of control as the Company performs. In contracts that require a portion of the consideration to be received in advance, at the commencement of the contract, such advance payment is initially recorded as a contract liability. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) Computer Hardware Sales The Company resells third-party hardware, such as computing servers and other technical devices, upon which the GameSTACK software platform is installed for its customers. These products are not required to be purchased in order to access the GameSTACK platform but are sold as a convenience to the customer. Revenue is recognized at the point in time when control of the hardware transfers to the customer. Control is transferred after the hardware has been procured, delivered, installed at the client’s premises and configured to allow for remote access. The Company has determined that it is acting as the principal in these transactions as it takes responsibility for procuring, delivering, installing and configuring the hardware at the customer’s location and takes control of the hardware, prior to transfer. Revenue is presented at the gross amount of consideration to which it is entitled from the customer in exchange for the hardware. Patent Licensing Revenue The Company generates revenue from time to time from the licensing of its U.S. patent, which governs the linkage of on-property reward cards to their counterpart Internet gambling accounts together with bilateral transmission of reward points between the Internet gambling technology system and the land-based casino management system present in all U.S casino properties. The nature of the promise in transferring the license is to provide a right to use the patent as it exists. The Company does not have to undertake activities to change the functionality of the patent during the license period and the license has significant stand-alone functionality. Therefore, the Company recognizes the revenue from the license of the patent, at the point in time when control of the license is transferred to the customer. Control is determined to transfer at the point in time the customer is able to use and benefit from the license. Contracts with Multiple Performance Obligations For customer contracts that have more than one performance obligation, the transaction price is allocated to the performance obligations in an amount that depicts the relative stand-alone selling prices of each performance obligation. Judgment is required in determining the stand-alone selling price for each performance obligation. In determining the allocation of the transaction price, an entity is required to maximize the use of observable inputs. When the stand-alone selling price of a good or service is not directly observable, an entity is required to estimate the stand-alone selling price. Customer contracts can include platform and content services as well as development services or hardware sales. The variable consideration is allocated entirely to the performance obligation for platform and content services as the variable consideration is allocable specifically to the delivery of the services in the period and the allocation is consistent with the allocation objective. For gaming, the Company allocates a portion of the user’s wager to incentives that create material rights that are redeemed or expired in the future. The allocated revenue for gaming wagers is primarily recognized when the wagers occur because all such wagers settle immediately. The Company applies a practical expedient by accounting for revenue from gaming on a portfolio basis because such wagers have similar characteristics, and the Company reasonably expects the effects on the financial statements of applying the revenue recognition guidance to the portfolio to not differ materially from that which would result if applying the guidance to an individual wagering contract. |
Cash | Cash The Company is required to maintain compensating cash balances to satisfy its liabilities to users. Such balances are included within cash on the condensed consolidated balance sheets and are not subject to creditor claims. At March 31, 2021 the related liabilities to users was $ 6,916 . |
Goodwill | Goodwill Goodwill represents the excess of the fair value of the consideration transferred over the estimated fair values of the identifiable assets acquired and liabilities assumed on the acquisition date. As disclosed in Note 5, the Company has recorded goodwill in connection with the acquisition of Coolbet on January 1, 2021. Goodwill is not amortized, but rather is reviewed for impairment annually or more frequently if facts or circumstances indicate that the carrying value may not be recoverable. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) The Company has determined that there are two If the quantitative impairment test for goodwill is deemed necessary, this quantitative impairment analysis compares the fair value of the Company’s reporting unit to its related carrying value. If the fair value of the reporting unit is less than its carrying amount, goodwill is written down to the fair value and an impairment loss is recognized. If the fair value of the reporting unit exceeds its carrying amount, no further analysis is required. Fair value of the reporting unit is determined using valuation techniques, primarily using discounted cash flow analysis. The Company will perform its annual impairment review of goodwill as of October 1 st |
Long-lived Assets | Long-lived Assets Long-lived assets, except goodwill, consist of property and equipment, and finite lived acquired intangible assets, such as developed software, gaming licenses, trademarks, trade names and customer relationships. Intangible assets are amortized on a straight-line basis over their estimated useful lives. The Company considers the period of expected cash flows and underlying data used to measure the fair value of the intangible assets when selecting the estimated useful lives. The fair value of the acquired intangible assets is primarily determined using the income approach. In performing these valuations, the Company’s key underlying assumptions used in the discounted cash flows were projected revenue, gross margin expectations and operating cost estimates. There are inherent uncertainties and management judgment required in these valuations. Acquired in-process technology consists of a proprietary technical platform. The Company reviews the in-process technology for impairment at least annually or more frequently if an event occurs creating the potential for impairment, until such time as the in-process technology efforts are completed. When completed, the developed technology will be amortized over its estimated useful life based on and using amortization methods that reflect the pattern in which the economic benefits of the intangible assets are consumed or otherwise realized. The technology is expected to be completed in the latter part of 2021. Long-lived assets, except goodwill, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company compares the undiscounted cash flows expected to be generated by that asset or asset group to their carrying amount. If the carrying amount of the long-lived asset or asset group are not recoverable on an undiscounted cash flow basis, an impairment charge is recognized to the extent that the carrying amount exceeds fair value. Fair value is determined through various techniques, such as discounted cash flow models using probability weighted estimated future cash flows and the use of valuation specialists. |
Capitalized Software Development Costs, net | Capitalized Software Development Costs, net The Company capitalizes certain development costs related to its software platforms during the application development stage. Costs associated with preliminary project activities, training, maintenance and all other post implementation stage activities are expensed as incurred. Software development costs are capitalized when application development begins, it is probable that the project will be completed, and the software will be used as intended. The Company capitalizes certain costs related to specific upgrades and enhancements when it is probable that expenditures will result in additional functionality of the platform to its customers. The capitalization policy provides for the capitalization of certain payroll and payroll related costs for employees who spent time directly associated with development and enhancements of the software platform. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) Capitalized software development costs are amortized on a straight-line basis over their estimated useful lives, which is generally three years |
Liabilities to Users | Liabilities to Users The Company records liabilities for user account balances. User account balances consist of user deposits, promotional awards and user winnings less user withdrawals and user losses. |
Share-based Compensation | Share-based Compensation Share-based compensation expense is recognized for equity-settled stock options and restricted stock issued to employees and non-employee members of the Company’s Board of Directors based on the fair value of these awards on the date of grant. The fair value of the stock options is estimated using a Black-Scholes option pricing model and the fair value of the restricted stock awards (restricted stock and restricted stock units) is based on the market price of the Company’s stock on the date of grant. Share-based compensation is recorded over the requisite service period, generally defined as the vesting period. For awards with graded vesting and only service conditions, compensation cost is recorded on a straight-line basis over the requisite service period of the entire award. Forfeitures are recorded in the period in which they occur. |
Income (Loss) Per Share, Basic and Diluted | Income (Loss) Per Share, Basic and Diluted Basic income (loss) per share is calculated by dividing net income (loss) by the weighted average number of ordinary shares outstanding during the year. In periods of income, diluted income per share is calculated by dividing net income by the weighted average number of ordinary shares outstanding during the year plus the assumed conversion of all potential dilutive ordinary shares. The Company determines the potentially dilutive ordinary shares using the treasury stock method. In periods of a net loss, basic and dilutive ordinary shares would be anti-dilutive. |
Reclassifications of Prior Period Amounts | Reclassifications of Prior Period Amounts Certain prior period amounts have been reclassified to conform to the current period presentation. Specifically, the due to the Coolbet acquisition in 2021, the Company has reclassified certain balances that were previously presented in separate balance sheet captions to other current and noncurrent assets, other accrued expenses, and other current and noncurrent liabilities in the condensed consolidated balance sheet as of December 31, 2020. These reclassifications had no impact on previously disclosed current assets, current liabilities, total assets and total liabilities. GAN LIMITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited, in thousands, except share and per share amounts) |
RESTATEMENT OF PRIOR FINANCIA_2
RESTATEMENT OF PRIOR FINANCIAL INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Changes and Error Corrections [Abstract] | |
SCHEDULE OF ERROR CORRECTIONS AND PRIOR PERIOD ADJUSTMENTS | The following table summarizes the effect of the Restatement on the condensed consolidated balance sheet as of March 31, 2021: SCHEDULE OF ERROR CORRECTIONS AND PRIOR PERIOD ADJUSTMENTS As Reported Adjustment As Restated Accounts receivable, net of allowance for doubtful accounts of $ 178 $ 11,945 $ 225 $ 12,170 Capitalized software development costs, net 8,134 (419 ) 7,715 Total assets 279,002 (194 ) 278,808 Other current liabilities 3,944 (211 ) 3,733 Other noncurrent liabilities 559 1,160 1,719 Total liabilities 28,456 949 29,405 Accumulated deficit (50,230 ) (1,146 ) (51,376 ) Accumulated other comprehensive loss (12,358 ) 3 (12,355 ) Total stockholders’ equity 250,546 (1,143 ) 249,403 Total liabilities and stockholders’ equity 279,002 (194 ) 278,808 The following table summarizes the effect of the Restatement on the condensed consolidated statement of operations for the three months ended March 31, 2021: As Reported Adjustment As Restated Revenue $ 27,842 $ (724 ) $ 27,118 Product and technology 4,850 393 5,243 General and administrative (1) 10,011 (2 ) 10,009 Depreciation and amortization 3,963 31 3,994 Total operating costs and expenses 31,644 422 32,066 Operating loss (3,802 ) (1,146 ) (4,948 ) Loss before income taxes (3,803 ) (1,146 ) (4,949 ) Net loss (4,464 ) (1,146 ) (5,610 ) Loss per share, basic and diluted $ (0.11 ) $ (0.02 ) $ (0.13 ) (1) Excludes depreciation and amortization The following table summarizes the effect of the Restatement on the condensed consolidated statement of cash flows for the three months ended March 31, 2021: As Reported Adjustment As Restated Net loss $ (4,464 ) $ (1,146 ) $ (5,610 ) Amortization of software and intangible assets 3,724 31 3,755 Accounts receivable (5,109 ) (225 ) (5,334 ) Other liabilities (644 ) 949 305 Net cash used in operating activities (4,145 ) (391 ) (4,536 ) Expenditures for capitalized software development costs (2,153 ) 391 (1,762 ) Net cash used in investing activities (95,017 ) 391 (94,626 ) |
ACQUISITION OF VINCENT GROUP _2
ACQUISITION OF VINCENT GROUP P.L.C. (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
SUMMARY OF CONSIDERATION TRANSFERRED | Fair value of the consideration transferred: SUMMARY OF CONSIDERATION TRANSFERRED Cash paid to Vincent Group shareholders $ 111,118 Restricted ordinary shares issued to Vincent Group shareholders (1) 106,683 Replacement equity-based awards to holders of Vincent Group equity-based awards (2) 297 Total $ 218,098 (1) The share consideration represents 5,260,516 20.28 (2) The replacement equity-based awards consist of options to purchase 67,830 |
SUMMARY OF FAIR VALUES OF ASSETS ACQUIRED AND LIABILITIES ASSUMED | Recognized amounts of identifiable assets acquired and liabilities assumed at fair value: SUMMARY OF FAIR VALUES OF ASSETS ACQUIRED AND LIABILITIES ASSUMED Cash $ 18,714 Prepaid expenses and other current assets 1,512 Property and equipment 343 Operating lease right-of-use assets 416 Intangible assets 48,370 Other noncurrent assets 73 Accounts payable (1,182 ) Liabilities to users (5,373 ) Other current liabilities (1,797 ) Operating lease liabilities (167 ) Deferred income taxes (2,265 ) Noncurrent operating lease liabilities (231 ) Total identifiable net assets 58,413 Goodwill 159,685 Total identifiable assets acquired and liabilities assumed including goodwill, net $ 218,098 |
SUMMARY OF INTANGIBLE ASSETS ACQUIRED | Identifiable intangible assets acquired as part of the acquisition, including their respective expected useful lives, were as follows: SUMMARY OF INTANGIBLE ASSETS ACQUIRED Estimated useful life (in years) Fair Value Trade names and trademarks 10.0 $ 5,800 Developed technology 3.0 28,100 In-process developed technology — 8,400 Customer relationships 3.0 5,600 Licenses various 470 $ 48,370 |
PRO FORMA OPERATING RESULTS | PRO FORMA OPERATING RESULTS Three Months Ended Revenues $ 14,815 Net loss $ (2,811 ) Loss per share – basic and diluted $ (0.10 ) |
CAPITALIZED SOFTWARE DEVELOPM_2
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Research and Development [Abstract] | |
SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET | Capitalized software development costs, net at March 31, 2021 and December 31, 2020 consisted of the following: SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET March 31, 2021 December 31, 2020 (Restated) Capitalized software development costs $ 27,074 $ 26,507 Development in progress 3,127 2,641 Total capitalized software development costs 30,201 29,148 Less: accumulated amortization (22,486 ) (22,500 ) Total $ 7,715 $ 6,648 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF GOODWILL | The changes in the carrying amount of goodwill, by segment, for the three months ended March 31, 2021 were as follows: SCHEDULE OF GOODWILL B2B B2C Total Balance at December 31, 2020 $ — $ — $ — Goodwill acquired in Coolbet acquisition 67,547 92,138 159,685 Effect of foreign currency translation (2,941 ) (4,010 ) (6,951 ) Balance at March 31, 2021 $ 64,606 $ 88,128 $ 152,734 |
SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS | Definite-lived intangible assets, net consisted of the following: SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS March 31, 2021 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Developed technology 3.0 $ 26,877 $ (2,240 ) $ 24,637 In-process technology — 8,034 — 8,034 Customer relationships 3.0 5,356 (446 ) 4,910 Trade names and trademarks 10.0 5,898 (486 ) 5,412 Licenses 6.7 1,860 (998 ) 862 $ 48,025 $ (4,170 ) $ 43,855 December 31, 2020 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade names and trademarks 3.0 $ 343 $ (343 ) $ — Licenses 5.3 1,366 (898 ) 468 $ 1,709 $ (1,241 ) $ 468 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCRUED EXPENSES | Accrued expenses consisted of the following: SCHEDULE OF ACCRUED EXPENSES March 31, 2021 December 31, 2020 Content licensing fees $ 2,103 $ 1,984 Sales taxes 929 756 Income taxes 890 17 Other 492 606 Total $ 4,414 $ 3,363 |
OTHER CURRENT LIABILITIES (Tabl
OTHER CURRENT LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
SCHEDULE OF OTHER CURRENT LIABILITIES | Other current liabilities consisted of the following: SCHEDULE OF OTHER CURRENT LIABILITIES March 31, 2021 December 31, 2020 (Restated) Revenue share due to SIM customers $ 2,486 $ 2,520 Contract liabilities 680 1,083 Operating lease liabilities 465 262 Other 102 202 Total $ 3,733 $ 4,067 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
SCHEDULE OF SHARE-BASED COMPENSATION, OPTION ACTIVITY | A summary of the stock option activity as of and for the three months ended March 31, 2021 is as follows: SCHEDULE OF SHARE-BASED COMPENSATION, OPTION ACTIVITY Number of Shares Weighted Average Exercise Price Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2020 3,061,859 $ 8.06 8.5 $ 37,410 Granted 1,216,140 24.35 Exercised (108,222 ) 2.40 Forfeited/expired or cancelled (3,080 ) 18.53 Outstanding at March 31, 2021 4,166,697 $ 12.96 9.2 $ 21,840 Options exercisable at March 31, 2021 1,820,667 $ 3.08 7.7 $ 27,524 |
SCHEDULE OF SHARE- BASED COMPENSATION, FAIR VALUE ASSUMPTIONS | The grant date fair value of each stock option grant was determined using the following weighted average assumptions: SCHEDULE OF SHARE- BASED COMPENSATION, FAIR VALUE ASSUMPTIONS Three Months Ended 2021 2020 Expected stock price volatility 61.50 % 67.60 % Expected term (in years) 4.95 5.00 Risk-free interest rate 0.72 % 0.44 % Dividend yield 0 % 0 % |
INCOME (LOSS) PER SHARE (Tables
INCOME (LOSS) PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Income (loss) per share | |
SCHEDULE OF THE COMPUTATION OF EARNINGS PER SHARE BASIC AND DILUTED | SCHEDULE OF THE COMPUTATION OF EARNINGS PER SHARE BASIC AND DILUTED 2021 2020 Three Months Ended March 31, 2021 2020 (Restated) Numerator: Net income (loss) $ (5,610 ) $ 694 Denominator: Weighted average ordinary shares outstanding, basic 41,986,083 21,512,225 Weighted average effect of potentially dilutive ordinary shares: Stock options — 1,528,120 Restricted stock awards — — Restricted stock units — — Weighted average ordinary shares outstanding, diluted 41,986,083 23,040,345 Income (loss) per share: Basic $ (0.13 ) $ 0.03 Diluted $ (0.13 ) $ 0.03 |
SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE | SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE 2021 2020 Three Months Ended March 31, 2021 2020 Stock options 4,166,697 — Restricted stock awards 93,680 — Restricted stock units 15,537 — Total 4,275,914 — |
REVENUES (Tables)
REVENUES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES | The following table reflects revenues recognized for the three months ended March 31, 2021 and 2020 in line with the timing of transfer of services SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES 2021 2020 Three Months Ended March 31, 2021 2020 (Restated) Revenues from services delivered at a point in time $ 17,312 $ — Revenues from services delivered over time 9,806 7,670 Total $ 27,118 $ 7,670 |
SCHEDULE OF ACTIVITY IN CONTRACT LIABILITIES | SCHEDULE OF ACTIVITY IN CONTRACT LIABILITIES 2021 2020 Three Months Ended March 31, 2021 2020 Balance at the beginning of the period $ 353 $ 86 Capitalized expenditures for the period 52 0 Amortization (22 ) (2 ) Effect of foreign currency translation 2 (6 ) Balance at the end of the period $ 385 $ 78 |
SCHEDULE OF CONTRACT WITH CUSTOMERS | The following table reflects contract liabilities arising from cash consideration received in advance from customers for the periods presented: SCHEDULE OF CONTRACT WITH CUSTOMERS Three Months Ended March 31, 2021 2020 (Restated) Contract liabilities from advance customer payments, beginning of the period $ 1,083 $ 3,023 Contract liabilities from advance customer payments, end of the period 1,840 2,095 Revenue recognized from amounts included in contract liabilities from advance customer payments at the beginning of the period 57 777 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue, Major Customer [Line Items] | |
SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS | Summarized financial information by reportable segments for the three months ended March 31, 2021 and 2020 is as follows: SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 B2B B2C Total B2B B2C Total (Restated) (Restated) Revenues $ 12,806 $ 14,312 $ 27,118 $ 7,670 $ — $ 7,670 Cost of revenues (1) 2,742 5,977 8,719 1,692 — 1,692 Segment gross profit (1) $ 10,064 $ 8,335 $ 18,399 $ 5,978 $ — $ 5,978 (1) Excludes depreciation and amortization |
SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT PROFIT TO CONSOLIDATED INCOME (LOSS) BEFORE INCOME TAXES | The following table presents a reconciliation of segment gross profit to consolidated income (loss) before income taxes for the three months ended March 31, 2021 and 2020: SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT PROFIT TO CONSOLIDATED INCOME (LOSS) BEFORE INCOME TAXES Three Months Ended March 31, 2021 2020 (Restated) Segment gross profit (1) $ 18,399 $ 5,978 Sales and marketing 4,101 863 Product and technology 5,243 1,024 General and administrative (1) 10,009 2,391 Depreciation and amortization 3,994 853 Interest expense, net 1 8 Income (loss) before income taxes $ (4,949 ) $ 839 (1) Excludes depreciation and amortization |
SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT | The following table disaggregates total revenue by product and services for each segment: SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT Three Months Ended March 31, 2021 2020 (Restated) B2B: Platform and content fees $ 9,184 $ 5,933 Development services and other 3,622 1,737 Total B2B $ 12,806 $ 7,670 B2C: Sportsbook $ 7,151 $ — Casino 6,471 — Poker 690 — Total B2C $ 14,312 $ — Total revenues $ 27,118 $ 7,670 |
SCHEDULE OF DISAGGREGATION OF REVENUE BY LOCATION | The following table reflects revenues recognized for the three months ended March 31, 2021 and 2020 in line with the timing of transfer of services SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES 2021 2020 Three Months Ended March 31, 2021 2020 (Restated) Revenues from services delivered at a point in time $ 17,312 $ — Revenues from services delivered over time 9,806 7,670 Total $ 27,118 $ 7,670 |
Customer [Member] | |
Revenue, Major Customer [Line Items] | |
SCHEDULE OF DISAGGREGATION OF REVENUE BY LOCATION | Revenue by location of the customer for the three months ended March 31, 2021 and 2020 was as follows: SCHEDULE OF DISAGGREGATION OF REVENUE BY LOCATION Three Months Ended March 31, 2021 2020 (Restated) United States $ 10,749 $ 6,251 Europe 11,064 1,410 Latin America 3,603 — Rest of the world 1,702 9 Total $ 27,118 $ 7,670 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
SCHEDULE OF INCOME TAX PROVISION | The provision for income taxes for the three months ended March 31, 2021 and 2020 consisted of the following: SCHEDULE OF INCOME TAX PROVISION Three Months Ended March 31, 2021 2020 Domestic (Bermuda) $ — $ — Foreign (Non-Bermuda) 661 145 Total $ 661 $ 145 |
NATURE OF OPERATIONS (Details N
NATURE OF OPERATIONS (Details Narrative) | 3 Months Ended |
Mar. 31, 2021Segments | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Operating segements | 2 |
SCHEDULE OF ERROR CORRECTIONS A
SCHEDULE OF ERROR CORRECTIONS AND PRIOR PERIOD ADJUSTMENTS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Accounts receivable, net of allowance for doubtful accounts of $178 at March 31, 2021 | $ 12,170 | $ 6,818 | |||
Capitalized software development costs, net | 7,715 | 6,648 | |||
Total assets | 278,808 | 173,246 | |||
Other current liabilities | 3,733 | 4,067 | |||
Other noncurrent liabilities | 1,719 | 370 | |||
Total liabilities | 29,405 | 17,682 | |||
Accumulated deficit | (51,376) | (45,766) | |||
Accumulated other comprehensive loss | (12,355) | (2,877) | |||
Total stockholders’ equity | 249,403 | $ 14,901 | 155,564 | $ 15,145 | |
Total liabilities and stockholders’ equity | 278,808 | $ 173,246 | |||
Revenue | 27,118 | 7,670 | |||
Product and technology | 5,243 | 1,024 | |||
General and administrative | [1] | 10,009 | 2,391 | ||
Depreciation and amortization | 3,994 | 853 | |||
Total operating costs and expenses | 32,066 | 6,823 | |||
Operating loss | (4,948) | 847 | |||
Loss before income taxes | (4,949) | 839 | |||
Net loss | $ (5,610) | 694 | |||
Loss per share, basic and diluted | $ (0.13) | ||||
Amortization of software and intangible assets | $ 3,755 | 792 | |||
Accounts receivable | (5,334) | (3,047) | |||
Other liabilities | 305 | (901) | |||
Net cash used in operating activities | (4,536) | (1,439) | |||
Expenditures for capitalized software development costs | (1,762) | (534) | |||
Net cash used in investing activities | (94,626) | $ (971) | |||
Previously Reported [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Accounts receivable, net of allowance for doubtful accounts of $178 at March 31, 2021 | 11,945 | ||||
Capitalized software development costs, net | 8,134 | ||||
Total assets | 279,002 | ||||
Other current liabilities | 3,944 | ||||
Other noncurrent liabilities | 559 | ||||
Total liabilities | 28,456 | ||||
Accumulated deficit | (50,230) | ||||
Accumulated other comprehensive loss | (12,358) | ||||
Total stockholders’ equity | 250,546 | ||||
Total liabilities and stockholders’ equity | 279,002 | ||||
Revenue | 27,842 | ||||
Product and technology | 4,850 | ||||
General and administrative | [2] | 10,011 | |||
Depreciation and amortization | 3,963 | ||||
Total operating costs and expenses | 31,644 | ||||
Operating loss | (3,802) | ||||
Loss before income taxes | (3,803) | ||||
Net loss | $ (4,464) | ||||
Loss per share, basic and diluted | $ (0.11) | ||||
Amortization of software and intangible assets | $ 3,724 | ||||
Accounts receivable | (5,109) | ||||
Other liabilities | (644) | ||||
Net cash used in operating activities | (4,145) | ||||
Expenditures for capitalized software development costs | (2,153) | ||||
Net cash used in investing activities | (95,017) | ||||
Revision of Prior Period, Adjustment [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Accounts receivable, net of allowance for doubtful accounts of $178 at March 31, 2021 | 225 | ||||
Capitalized software development costs, net | (419) | ||||
Total assets | (194) | ||||
Other current liabilities | (211) | ||||
Other noncurrent liabilities | 1,160 | ||||
Total liabilities | 949 | ||||
Accumulated deficit | (1,146) | ||||
Accumulated other comprehensive loss | 3 | ||||
Total stockholders’ equity | (1,143) | ||||
Total liabilities and stockholders’ equity | (194) | ||||
Revenue | (724) | ||||
Product and technology | 393 | ||||
General and administrative | [2] | (2) | |||
Depreciation and amortization | 31 | ||||
Total operating costs and expenses | 422 | ||||
Operating loss | (1,146) | ||||
Loss before income taxes | (1,146) | ||||
Net loss | $ (1,146) | ||||
Loss per share, basic and diluted | $ (0.02) | ||||
Amortization of software and intangible assets | $ 31 | ||||
Accounts receivable | (225) | ||||
Other liabilities | 949 | ||||
Net cash used in operating activities | (391) | ||||
Expenditures for capitalized software development costs | 391 | ||||
Net cash used in investing activities | $ 391 | ||||
[1] | Excludes depreciation and amortization | ||||
[2] | Excludes depreciation and amortization |
SCHEDULE OF ERROR CORRECTIONS_2
SCHEDULE OF ERROR CORRECTIONS AND PRIOR PERIOD ADJUSTMENTS (Details) (Parenthitical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accounting Changes and Error Corrections [Abstract] | ||
Allowance for doubtful accounts | $ 178 | $ 100 |
BASIS OF PRESENTATION (Details
BASIS OF PRESENTATION (Details Narrative) £ / shares in Units, £ in Thousands, $ in Thousands | May 05, 2020USD ($)shares | May 05, 2020GBP (£)£ / sharesshares |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Shares issued per share of acquiree | shares | 4 | 4 |
Aggregate cash paid for partial shares | $ 2,525 | £ 2,004 |
Cash paid for partial shares | £ / shares | £ 2.32 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021USD ($)SegmentsProduct | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Property, Plant and Equipment [Line Items] | |||
Foreign currency transaction and remeasurement gains and losses, net | $ 9,478 | $ 1,320 | |
Amounts due to customers, current | $ 2,486 | $ 2,520 | |
Number of third-party iGaming products available | Product | 1,600 | ||
Liabilities to users | $ 6,916 | ||
Number of reporting units | Segments | 2 | ||
Software and Software Development Costs [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Weighted Average Amortization Period | 3 years | ||
Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Contract with customer duration | 3 years | ||
Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Contract with customer duration | 5 years |
SUMMARY OF CONSIDERATION TRANSF
SUMMARY OF CONSIDERATION TRANSFERRED (Details) - Vincent Group P.L.C. [Member] $ in Thousands | Jan. 02, 2021USD ($) | |
Business Acquisition [Line Items] | ||
Cash paid to Vincent Group shareholders | $ 111,118 | |
Restricted ordinary shares issued to Vincent Group shareholders | 106,683 | [1] |
Replacement equity-based awards to holders of Vincent Group equity-based awards | 297 | [2] |
Total | $ 218,098 | |
[1] | The share consideration represents 5,260,516 20.28 | |
[2] | The replacement equity-based awards consist of options to purchase 67,830 |
SUMMARY OF CONSIDERATION TRAN_2
SUMMARY OF CONSIDERATION TRANSFERRED (Details) (Parenthetical) - Vincent Group P.L.C. [Member] | Jan. 02, 2021$ / sharesshares |
Business Acquisition [Line Items] | |
Shares issued as partial consideration for acquisition, shares | 5,260,516 |
Share price of ordinary shares issued | $ / shares | $ 20.28 |
Replacement equity-based awards, shares | 67,830 |
SUMMARY OF FAIR VALUES OF ASSET
SUMMARY OF FAIR VALUES OF ASSETS ACQUIRED AND LIABILITIES ASSUMED (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Jan. 02, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Goodwill | $ 152,734 | ||
Vincent Group P.L.C. [Member] | |||
Business Acquisition [Line Items] | |||
Cash | $ 18,714 | ||
Prepaid expenses and other current assets | 1,512 | ||
Property and equipment | 343 | ||
Operating lease right-of-use assets | 416 | ||
Intangible assets | 48,370 | ||
Other noncurrent assets | 73 | ||
Accounts payable | (1,182) | ||
Liabilities to users | (5,373) | ||
Other current liabilities | (1,797) | ||
Operating lease liabilities | (167) | ||
Deferred income taxes | $ (2,265) | (2,265) | |
Noncurrent operating lease liabilities | (231) | ||
Total identifiable net assets | 58,413 | ||
Goodwill | 159,685 | ||
Total identifiable assets acquired and liabilities assumed including goodwill, net | $ 218,098 |
SUMMARY OF INTANGIBLE ASSETS AC
SUMMARY OF INTANGIBLE ASSETS ACQUIRED (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Vincent Group P.L.C. [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Fair Value | $ 48,370 | ||
Trademarks and Trade Names [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life (in years) | 10 years | 10 years | 3 years |
Fair Value | $ 5,800 | ||
Developed Technology [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life (in years) | 3 years | ||
Fair Value | $ 28,100 | ||
In Process Developed Technology [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life (in years) | |||
Fair Value | $ 8,400 | ||
Customer Relationships [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life (in years) | 3 years | 3 years | |
Fair Value | $ 5,600 | ||
License [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life (in years) | 6 years 8 months 12 days | 5 years 3 months 18 days | |
Fair Value | $ 470 | ||
Estimated useful life, description | various |
PRO FORMA OPERATING RESULTS (De
PRO FORMA OPERATING RESULTS (Details) - Vincent Group P.L.C. [Member] $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($)$ / shares | |
Business Acquisition [Line Items] | |
Revenues | $ 14,815 |
Net loss | $ (2,811) |
Loss per share – basic and diluted | $ / shares | $ (0.10) |
ACQUISITION OF VINCENT GROUP _3
ACQUISITION OF VINCENT GROUP P.L.C. (Details Narrative) - USD ($) $ in Thousands | Jan. 02, 2021 | Mar. 31, 2021 | Jan. 01, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 152,734 | |||
Business To Consumer Segment (B2C) [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 88,128 | $ 92,138 | ||
Vincent Group P.L.C. [Member] | ||||
Business Acquisition [Line Items] | ||||
Deferred income tax liability | $ 2,265 | 2,265 | ||
Goodwill | 159,685 | |||
Acquisition related costs | $ 1,309 | $ 290 | ||
Vincent Group P.L.C. [Member] | Business To Consumer Segment (B2C) [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 67,547 |
SCHEDULE OF CAPITALIZED COMPUTE
SCHEDULE OF CAPITALIZED COMPUTER SOFTWARE COSTS, NET (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Research and Development [Abstract] | ||
Capitalized software development costs | $ 27,074 | $ 26,507 |
Development in progress | 3,127 | 2,641 |
Total capitalized software development costs | 30,201 | 29,148 |
Less: accumulated amortization | (22,486) | (22,500) |
Total | $ 7,715 | $ 6,648 |
CAPITALIZED SOFTWARE DEVELOPM_3
CAPITALIZED SOFTWARE DEVELOPMENT COSTS, NET (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Research and Development [Abstract] | ||
Amortization expense | $ 760 | $ 756 |
SCHEDULE OF GOODWILL (Details)
SCHEDULE OF GOODWILL (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Indefinite-lived Intangible Assets [Line Items] | |
Goodwill, beginning balance | |
Goodwill acquired in Coolbet acquisition | 159,685 |
Effect of foreign currency translation | (6,951) |
Goodwill, ending balance | 152,734 |
Business to Business (B2B) [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Goodwill, beginning balance | |
Goodwill acquired in Coolbet acquisition | 67,547 |
Effect of foreign currency translation | (2,941) |
Goodwill, ending balance | 64,606 |
Business To Consumer Segment (B2C) [Member] | |
Indefinite-lived Intangible Assets [Line Items] | |
Goodwill, beginning balance | |
Goodwill acquired in Coolbet acquisition | 92,138 |
Effect of foreign currency translation | (4,010) |
Goodwill, ending balance | $ 88,128 |
SCHEDULE OF FINITE - LIVED INTA
SCHEDULE OF FINITE - LIVED INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 48,025 | $ 1,709 | |
Accumulated Amortization | (4,170) | (1,241) | |
Net Carrying Amount | 43,855 | $ 468 | |
In-Process Technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 8,034 | ||
Accumulated Amortization | |||
Net Carrying Amount | $ 8,034 | ||
Developed Technology Rights [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period | 3 years | ||
Gross Carrying Amount | $ 26,877 | ||
Accumulated Amortization | (2,240) | ||
Net Carrying Amount | $ 24,637 | ||
Customer Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period | 3 years | 3 years | |
Gross Carrying Amount | $ 5,356 | ||
Accumulated Amortization | (446) | ||
Net Carrying Amount | $ 4,910 | ||
Trademarks and Trade Names [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period | 10 years | 10 years | 3 years |
Gross Carrying Amount | $ 5,898 | $ 343 | |
Accumulated Amortization | (486) | (343) | |
Net Carrying Amount | $ 5,412 | ||
License [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period | 6 years 8 months 12 days | 5 years 3 months 18 days | |
Gross Carrying Amount | $ 1,860 | $ 1,366 | |
Accumulated Amortization | (998) | (898) | |
Net Carrying Amount | $ 862 | $ 468 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense related to capitalized development costs | $ 2,995 | $ 36 |
Estimated amortization expense, remainder of fiscal year | 8,636 | |
Estimated amortization expense, 2022 | 11,500 | |
Estimated amortization expense, 2023 | 11,481 | |
Estimated amortization expense, 2024 | 639 | |
Estimated amortization expense, 2025 | $ 625 |
SCHEDULE OF ACCRUED EXPENSES (D
SCHEDULE OF ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Content licensing fees | $ 2,103 | $ 1,984 |
Sales taxes | 929 | 756 |
Income taxes | 890 | 17 |
Other | 492 | 606 |
Total | $ 4,414 | $ 3,363 |
SCHEDULE OF OTHER CURRENT LIABI
SCHEDULE OF OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | ||
Revenue share due to SIM customers | $ 2,486 | $ 2,520 |
Contract liabilities | 680 | 1,083 |
Operating lease liabilities | 465 | 262 |
Other | 102 | 202 |
Total | $ 3,733 | $ 4,067 |
SCHEDULE OF SHARE-BASED COMPENS
SCHEDULE OF SHARE-BASED COMPENSATION, OPTION ACTIVITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | ||
Number of Shares, Beginning balance | 3,061,859 | |
Weighted Average Exercise Price, Beginning balance | $ 8.06 | |
Weighted Average Contractual Term, Outstanding | 9 years 2 months 12 days | 8 years 6 months |
Aggregate intrinsic value, Beginning balance | $ 37,410 | |
Number of Shares, Granted | 1,216,140 | |
Weighted Average Exercise Price, Granted | $ 24.35 | |
Number of Shares, Exercised | (108,222) | |
Weighted Average Exercise Price, Exercised | $ 2.40 | |
Number of Shares, Forfeited/expired or cancelled | (3,080) | |
Weighted Average Exercise Price, Forfeited/expired or cancelled | $ 18.53 | |
Number of Shares, Ending balance | 4,166,697 | 3,061,859 |
Weighted Average Exercise Price, Ending balance | $ 12.96 | $ 8.06 |
Aggregate intrinsic value, Ending balance | $ 21,840 | $ 37,410 |
Number of Shares, exercisable | 1,820,667 | |
Weighted Average Exercise Price, exercisable | $ 3.08 | |
Weighted Average Contractual Term, Exercisable | 7 years 8 months 12 days | |
Aggregate intrinsic value, exercisable | $ 27,524 |
SCHEDULE OF SHARE- BASED COMPEN
SCHEDULE OF SHARE- BASED COMPENSATION, FAIR VALUE ASSUMPTIONS (Details) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | ||
Expected stock price volatility | 61.50% | 67.60% |
Expected term (in years) | 4 years 11 months 12 days | 5 years |
Risk-free interest rate | 0.72% | 0.44% |
Dividend yield | 0.00% | 0.00% |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details Narrative) - USD ($) | 3 Months Ended | ||||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Apr. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected period of recognition for replacement stock option awards | 4 years 11 months 12 days | 5 years | |||
Capitalized Computer software | $ 7,715,000 | $ 6,648,000 | |||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount | $ 22,945,000 | ||||
Period of recognition for unrecognized share based compensation | 3 years 7 months 6 days | ||||
Weighted average grant date fair value of options granted | $ 12.86 | $ 4.72 | |||
Decrease in financial liability fair value option | $ 93,000 | ||||
Acquisition Agreement [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares issued, issued | 67,830 | ||||
Acquisition Agreement [Member] | Minimum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected period of recognition for replacement stock option awards | 1 year | ||||
Acquisition Agreement [Member] | Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected period of recognition for replacement stock option awards | 3 years | ||||
Share-based Payment Arrangement, Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expiration period of options | 10 years | ||||
Shares issued, issued | 1,148,310 | ||||
Share-based Payment Arrangement, Expense | $ 1,139,000 | $ 295,000 | |||
Capitalized Computer software | $ 48,000 | $ 23,000 | |||
Share-based Payment Arrangement, Option [Member] | Share-based Payment Arrangement, Tranche One [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percentage | 25.00% | ||||
Restricted Stock Units (RSUs) [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percentage | 25.00% | ||||
Shares issued, issued | 15,537 | ||||
Share-based Payment Arrangement, Expense | $ 25 | ||||
Vesting period | 1 year | ||||
Grant date fair value of restricted stock | $ 25.10 | ||||
Unrecognized share-based compensation expense | $ 365 | ||||
Restricted Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares issued, issued | 93,680 | ||||
Share-based Payment Arrangement, Expense | $ 420 | ||||
Vesting period | 1 year | ||||
Grant date fair value of restricted stock | $ 18.19 | ||||
Unrecognized share-based compensation expense | $ 350 | ||||
2020 Equity Incentive Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares available for grant | 4,400,000 | ||||
Percentage increase based on prior year's outstanding shares | 4.00% | ||||
Number of shares remaining for future issuance | 726,581 |
SCHEDULE OF THE COMPUTATION OF
SCHEDULE OF THE COMPUTATION OF EARNINGS PER SHARE BASIC AND DILUTED (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Net income (loss) | $ (5,610) | $ 694 |
Weighted average ordinary shares outstanding, basic | 41,986,083 | 21,512,225 |
Weighted average ordinary shares outstanding, diluted | 41,986,083 | 23,040,345 |
Basic | $ (0.13) | $ 0.03 |
Diluted | $ (0.13) | $ 0.03 |
Share-based Payment Arrangement, Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock units | 1,528,120 | |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock units | ||
Restricted Stock Units (RSUs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock units |
SCHEDULE OF ANTI-DILUTIVE STOCK
SCHEDULE OF ANTI-DILUTIVE STOCK EXCLUDED FROM COMPUTATION OF DILUTED EARNINGS PER SHARE (Details) - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Restricted stock units | 4,275,914 | |
Total | 4,275,914 | |
Equity Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Restricted stock units | 4,166,697 | |
Total | 4,166,697 | |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Restricted stock units | 93,680 | |
Total | 93,680 | |
Restricted Stock Units (RSUs) [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Restricted stock units | 15,537 | |
Total | 15,537 |
SCHEDULE OF REVENUE RECOGNIZED
SCHEDULE OF REVENUE RECOGNIZED IN LINE WITH THE TIMING OF TRANSFER OF SERVICES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenues from services delivered over time | $ 27,118 | $ 7,670 |
Total | 27,118 | 7,670 |
Transferred at Point in Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues from services delivered over time | 17,312 | |
Total | 17,312 | |
Transferred over Time [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenues from services delivered over time | 9,806 | 7,670 |
Total | $ 9,806 | $ 7,670 |
SCHEDULE OF ACTIVITY IN CONTRAC
SCHEDULE OF ACTIVITY IN CONTRACT LIABILITIES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||
Balance at the beginning of the period | $ 353 | $ 86 |
Capitalized expenditures for the period | 52 | 0 |
Amortization | (22) | (2) |
Effect of foreign currency translation | 2 | (6) |
Balance at the end of the period | $ 385 | $ 78 |
SCHEDULE OF CONTRACT WITH CUSTO
SCHEDULE OF CONTRACT WITH CUSTOMERS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | ||
Contract liabilities from advance customer payments, beginning of the period | $ 1,083 | $ 3,023 |
Contract liabilities from advance customer payments, end of the period | 1,840 | 2,095 |
Revenue recognized | $ 57 | $ 777 |
REVENUES (Details Narrative)
REVENUES (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 27,118,000 | $ 7,670,000 | |
Revenue generated, percentage | 10.00% | ||
Contract liability | $ 6,916,000 | ||
Other Current Liabilities [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Contract liability | 680 | ||
Other Liabilities [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Contract liability | 1,160 | ||
Business to Business (B2B) [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 12,806,000 | 7,670,000 | |
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Customer One [Member] | Business to Business (B2B) [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 3,995,000 | $ 4,348,000 | |
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Customer Two [Member] | Business to Business (B2B) [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 3,633,000 | ||
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Customer [Member] | Business to Business (B2B) [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk, percentage | 28.10% | 56.70% | |
Development Services And Other [Member] | Business to Business (B2B) [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 3,622,000 | $ 1,737,000 | |
Transferred at Point in Time [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 17,312,000 | ||
Transferred at Point in Time [Member] | Gaming Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | 14,312,000 | ||
Transferred at Point in Time [Member] | Development Services And Other [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues | $ 3,000,000 |
SCHEDULE OF FINANCIAL INFORMATI
SCHEDULE OF FINANCIAL INFORMATION FOR REPORTABLE SEGMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Segment Reporting Information [Line Items] | |||
Revenues | $ 27,118 | $ 7,670 | |
Cost of revenues | [1] | 8,719 | 1,692 |
Segment gross profit | [2] | 18,399 | 5,978 |
Business to Business (B2B) [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 12,806 | 7,670 | |
Cost of revenues | [2] | 2,742 | 1,692 |
Segment gross profit | [2] | 10,064 | 5,978 |
Business To Consumer Segment (B2C) [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 14,312 | ||
Cost of revenues | [2] | 5,977 | |
Segment gross profit | [2] | $ 8,335 | |
[1] | Excludes depreciation and amortization | ||
[2] | Excludes depreciation and amortization |
SCHEDULE OF RECONCILIATION OF C
SCHEDULE OF RECONCILIATION OF CONSOLIDATED SEGMENT PROFIT TO CONSOLIDATED INCOME (LOSS) BEFORE INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Segment Reporting [Abstract] | |||
Segment gross profit | [1] | $ 18,399 | $ 5,978 |
Sales and marketing | 4,101 | 863 | |
Product and technology | 5,243 | 1,024 | |
General and administrative | [2] | 10,009 | 2,391 |
Depreciation and amortization | 3,994 | 853 | |
Interest expense, net | 1 | 8 | |
Income (loss) before income taxes | $ (4,949) | $ 839 | |
[1] | Excludes depreciation and amortization | ||
[2] | Excludes depreciation and amortization |
SCHEDULE OF DISAGGREGATION OF R
SCHEDULE OF DISAGGREGATION OF REVENUE BY PRODUCTS AND SERVICES FOR EACH SEGMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue from External Customer [Line Items] | ||
Revenues | $ 27,118 | $ 7,670 |
Business to Business (B2B) [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenues | 12,806 | 7,670 |
Business To Consumer Segment (B2C) [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenues | 14,312 | |
Platform And Content Fees [Member] | Business to Business (B2B) [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenues | 9,184 | 5,933 |
Development Services And Other [Member] | Business to Business (B2B) [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenues | 3,622 | 1,737 |
Sports [Member] | Business To Consumer Segment (B2C) [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenues | 7,151 | |
Casino [Member] | Business To Consumer Segment (B2C) [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenues | 6,471 | |
Poker [Member] | Business To Consumer Segment (B2C) [Member] | ||
Revenue from External Customer [Line Items] | ||
Revenues | $ 690 |
SCHEDULE OF DISAGGREGATION OF_2
SCHEDULE OF DISAGGREGATION OF REVENUE BY LOCATION (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 27,118 | $ 7,670 |
UNITED STATES | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 10,749 | 6,251 |
Europe [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 11,064 | 1,410 |
Latin America [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 3,603 | |
Rest Of The World [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 1,702 | $ 9 |
SCHEDULE OF INCOME TAX PROVISIO
SCHEDULE OF INCOME TAX PROVISION (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Total | $ 661 | $ 145 |
BERMUDA | ||
Total | ||
Other Tax Localities [Member] | ||
Total | $ 661 | $ 145 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Jan. 02, 2021 | |
Operating Loss Carryforwards [Line Items] | |||
Effective income tax rate | (13.40%) | 17.30% | |
Vincent Group P.L.C. [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Deferred income tax liability | $ 2,265 | $ 2,265 | |
Minimum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Effective income tax rate | 0.00% | ||
Maximum [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Effective income tax rate | 5.00% | ||
BERMUDA | Foreign Tax Authority [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Effective income tax rate | 0.00% |