- Revenue Decreases 20% Year-Over-Year to $4.4 Million

- Bookings^* Decreases 14% Year-Over-Year to $4.6 Million

- Net Income of $38k Compared to Previous Year Net income of $285k

- Adjusted EBITDA^* Decreases 29% Year-Over-Year to $890k

- Basic and Fully Diluted EPS of $0.01

NEW YORK, March 12, 2024 /PRNewswire/ -- Tapinator, Inc. (OTC:TAPM) ("Tapinator," the "Company," "we," "our" or "us"), a developer and publisher of category leading games for mobile platforms, today announced unaudited financial results for the period ended December 31, 2023, and the filing of its annual report for the years ended December 31, 2023 and 2022.

The annual report and financial statements have been published on OTC Markets and may be found at http://www.otcmarkets.com/stock/TAPM/disclosure. The results provided below replace, in their entirety, any guidance or projections previously issued by the Company.

For the year ended December 31, 2023, Tapinator achieved revenue of approximately $4.4 million, bookings^* of approximately $4.6 million, net income of approximately $38,000 and adjusted EBITDA^* of approximately $890,000. The Company's annual revenue, bookings^*, net income and adjusted EBITDA^* represent year-over-year declines of 20%, 14%, 87% and 29%, respectively. For the full year, the Company also announced basic and fully diluted net income of $0.01 per share.

For the three months ended December 31, 2023, Tapinator achieved revenue of approximately $1.2 million, bookings^* of approximately $1.1 million, net income of approximately $41,000 and adjusted EBITDA^* of approximately $217,000. The Company's quarterly revenue, bookings and adjusted EBITDA^* represent year-over-year declines of 0%, 3%, and 20%, respectively. For the quarter, the Company also announced basic and fully diluted net income of $0.02 per share.

^*A table has been included in this press release with non-GAAP adjustments to the Company's revenue resulting in bookings (a non-GAAP measure) and non-GAAP adjustments to the Company's net income, resulting in adjusted EBITDA (a non-GAAP measure) for the relevant periods.

Financial Highlights

	Three Months Ended			Year Ended
	December 31			December 31
	2023	2022	*% Ch.*	2023	2022	*% Ch.*
GAAP Results:
Revenue	$1,157,609	$1,153,179	0 %	$4,435,777	$5,536,328	-20 %
Operating Income	($40,220)	$96,028	-142 %	$220,841	$521,819	-58 %
Net Income (Loss)	$41,122	($591,821)	NM⁽¹⁾	$37,691	$285,267	-87 %
Net Income (Loss) margin %	4 %	-51 %		1 %	5 %

Net Income (Loss) Per Share - Basic	$0.02	($0.22)		$0.01	$0.10
Net Income (Loss) Per Share - Diluted	$0.02	($0.22)		$0.01	$0.10

Weighted avg. common shares outstanding - basic	2,725,439	2,725,439		2,725,439	2,802,109
Weighted avg. common shares outstanding - diluted	2,725,439	2,726,105		2,725,439	2,869,878

Non-GAAP Results:
Bookings:
Category Leading Games	$1,093,386	$1,065,476	3 %	$4,427,212	$4,735,486	-7 %
Rapid-Launch Games	24,681	53,929	-54 %	190,910	359,811	-47 %
NFT Publishing	-	28,192	-100 %	-	258,246	-100 %
Total Bookings	$1,118,067	$1,147,597	-3 %	$4,618,122	$5,353,543	-14 %

Adjusted EBITDA	$216,646	$269,580	-20 %	$890,205	$1,259,827	-29 %
Adjusted EBITDA Margin %	19 %	23 %		20 %	23 %

⁽¹⁾ Percentage change not meaningful.

Ilya Nikolayev, CEO of Tapinator, commented, "Year-over-year, we saw a 9% decrease in bookings for our games business, with a 2% decrease in our core Video Poker Classic property. These results can be attributed to: (1) marketing challenges facing the mobile industry based on privacy changes that have made player targeting and tracking more difficult; (2) the continuing decline of our legacy Rapid Launch Games business; and (3) a mobile games industry that continues to mature and which has become increasingly competitive.

We have previously communicated that, from a product perspective, our focus is threefold.

Continue to execute on our Video Poker Classic roadmap, to further optimize our flagship product
Port features that have been proven within Video Poker Classic to Keno Vegas and Lucky Lotto, with the goal of pushing the metrics of these titles closer to that of Video Poker Classic, and
Launch a new mobile game that focuses on the blackjack space, Blackjack Live Casino

We are pleased to report that we are executing on all three initiatives. We launched Blackjack Live Casino four months ago. The game is a social product at its core and features "stadium" gameplay. This means that all online players are dealt the same initial two cards and are then able to independently make decisions on how to play the hand, with the goal of beating the dealer in heads up gameplay. To add to the social experience, the game features real-time, live hosts who engage with players, via voice, and provide commentary on gameplay, strategy, player chat, and more. Currently, live hosts are present 18 hours per day, 7 days per week. We are encouraged by the monetization metrics that we are seeing and are very focused on improving retention which, we believe, is key to success.

As noted previously, given the maturation of mobile gaming, we are also seeking alternative growth opportunities for our shareholders within other industries/markets that can offer more significant growth prospects for the Company. We have evaluated numerous other opportunities to drive shareholder value over the past year and continue to evaluate such opportunities."

Non-GAAP Financial Measures*

We have provided in this release the non-GAAP financial measures of Bookings and adjusted EBITDA as a supplement to the measures of Revenue and Operating which are prepared in accordance with United States generally accepted accounting principles ("GAAP"). Management uses Bookings and adjusted EBITDA internally in analyzing our financial results to assess operational performance and liquidity. The presentation of Bookings and adjusted EBITDA is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. We believe that both management and investors benefit from referring to Bookings and adjusted EBITDA in assessing our performance and when planning, forecasting, and analyzing future periods. We believe Bookings and adjusted EBITDA are useful to investors because it allows for greater transparency with respect to key financial metrics we use in making operating decisions and because our investors and analysts use them to help assess the health of our business. Below, we have provided reconciliations between our historical Bookings and adjusted EBITDA to the most directly comparable GAAP financial measures. Some limitations of Bookings and adjusted EBITDA are as follows:

Bookings do not reflect that we defer and recognize online game revenue over the estimated life of durable virtual goods;
Adjusted EBITDA does not include the impact of stock-based expense, impairment of previously capitalized software or intangible assets previously acquired, gain on digital asset dividends & airdrops, gain on sale of digital assets and gain on sale of investments;
Adjusted EBITDA does not reflect income tax expense;
Adjusted EBITDA does not include other income or expenses, which includes foreign exchange gains and losses, interest income or expense, and gain on extinguishment of debt;
Adjusted EBITDA excludes depreciation and amortization of intangible assets and impairment of capitalized software. Although depreciation, amortization, and impairment of capitalized software are non-cash charges, the assets being depreciated, amortized, or impaired may have to be replaced in the future; and
Other companies, including companies in our industry, may calculate adjusted EBITDA differently or not at all, which will reduce their usefulness as a comparative measure.

Because of these limitations, you should consider Bookings and adjusted EBITDA, along with other financial performance measures, including Revenue, Net Income (Loss), Basic and Diluted Net Income (Loss) Per Share, Cash Flow from Operations, Operating Income (Loss), and our other financial results presented in accordance with GAAP.

NFT500 Supplemental Information – Summary Collection Metrics

	Totals as of 12/31/2022	Q1 2023	Q2 2023	Q3 2023	Q4 2023	Cumulative Totals as of 12/31/2023
# of NFTs Collected	581	110	14	19	0	724
# of NFTs Sold	-54	-80	-99	-6	-53	-292
# of NFTs Held, Cumulatively	527	557	472	485	432	432
Cost of NFTs Collected	$ 2,665,445	$ 142,054	$ 22,711	$ 95,018	$ -	$ 2,925,228
Proceeds from Sale of Collected NFTs	(1,191,354)	(277,504)	(51,391)	(9,139)	$ (71,094)	(1,600,482)
Proceeds from Sale of Digital Asset Dividends	(185,816)	-	-	-	-	(185,816)
Cost of NFTs Collected, Net of Sales Proceeds	$ 1,288,275	$ (135,450)	$ (28,680)	$ 85,879	$ (71,094)	$ 1,138,930

Reconciliation of GAAP to Non-GAAP Results

	Three Months Ended		Year Ended
	December 31		December 31
	2023	2022	2023	2022
Reconciliation of Revenue to Bookings:
Revenue	$1,157,609	$1,153,179	$4,435,777	$5,536,328
Change in deferred revenue	(39,542)	(5,582)	182,345	(182,785)
Bookings	$1,118,067	$1,147,597	$4,618,122	$5,353,543

Reconciliation of Net Income to Adjusted EBITDA:
Net income (loss)	$41,122	($591,821)	$37,691	$285,267
Interest expense, net	(1,834)	-	(6,088)	(322)
Impairment of capitalized software	$37,464	$143,805	$37,464	$143,805
Income tax expense, net	(37,518)	-	17,382	-
Gain on digital asset dividends & airdrops	-	-	-	(145,681)
Amortization of capitalized software development costs	215,557	120,485	609,667	367,959
Depreciation and amortization of other assets	3,212	3,212	12,849	13,892
Impairment of digital assets	-	578,811	449,514	1,031,656
Gain (loss) on sale of digital assets	(41,992)	(8,113)	(274,061)	(569,104)
Gain on sale of investments	-	-	(3,596)	(5,091)
Stock-based compensation	635	23,201	9,383	137,446
Adjusted EBITDA	$216,646	$269,580	$890,205	$1,259,827

About Tapinator

Tapinator Inc. (OTC:TAPM) develops and publishes category leading games for mobile platforms. Tapinator's library includes more than 300 titles that, collectively, have achieved over 500 million mobile downloads, including notable properties such as Video Poker Classic, Keno Vegas, and Blackjack Live Casino. We generate revenues from our mobile games via consumer transactions, including in-app purchases and subscriptions, and through the sale of branded advertisements. Founded in 2013, we are headquartered in New York, with product teams located in North America and Europe.

Forward Looking Statements

To the extent that statements contained in this press release are not descriptions of historical facts regarding Tapinator, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as "believe," "goal," "seek," "plan," "feel," "opinion," "may," "will," "expect," "anticipate," "estimate," "intend," "target," and similar expressions (as well as other words or expressions referencing future events, conditions, or circumstances) are intended to identify forward-looking statements. These forward-looking statements include, among other things, our belief that Blackjack Live Casino is uniquely positioned within the blackjack gaming category and in the game's potential, our belief that all three strategic components summarized in the bullets points above are important for the growth of our business and our belief that there is significant opportunity for a third type of experience in the mobile blackjack gaming space, focused on live, community play. Forward-looking statements are subject to risks and uncertainties that could cause our future results, performance or achievements to differ significantly from those expressed or implied by the forward-looking statements. Except as required by law, Tapinator undertakes no obligation to update or revise any forward-looking statements. The quoting and trading of the Company's common stock on the OTC Marketplace is often thin and characterized by wide fluctuations in trading prices, due to many factors that may have little to do with the Company's operations or business prospects. As a result, there may be volatility in the market price of the shares of the Company's common stock for reasons unrelated to operating performance. Moreover, the OTC Marketplace is not a stock exchange, and trading of securities on it is often more sporadic than trading of securities listed on a national securities exchange. Accordingly, stockholders may have difficulty reselling any of their shares. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of the Company, please see the Company's Supplemental Information Report as filed with the OTC Markets on October 20, 2021 and as updated from time to time.

CONTACT:

Tapinator Investor Relations

investor.relations@tapinator.com

914.930.6232

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SOURCE Tapinator, Inc.