**Animoca Brands Reports a 30% Decrease in Bookings in 2023**
Animoca Brands, a Web3 gaming company, recently announced that its bookings dropped by 30% from $402 million in 2022 to $280 million in 2023. This decline in bookings can be attributed to the slowdown of economic activities in the Web3 market and the challenges faced by crypto-related businesses following events like the FTX scandal and the collapse of Luna and TerraUSD. These events contributed to the crypto winter that persisted throughout 2023.
Despite the decrease in bookings, Animoca Brands mentioned that its performance improved towards the end of 2023 as digital asset markets strengthened. In fact, the company reported a 59% increase in bookings in Q4 2023 compared to the previous quarter.
**Business Segments Contributing to Bookings**
In 2023, Animoca Brands generated bookings from various business segments. The company reported $77 million in bookings from digital asset advisory activity, which includes fees from token advisory, trading, and blockchain node operations. It also reported bookings of $182 million from sales made by subsidiaries and projects incubated by Animoca Brands, such as token sales, NFT sales, in-app purchases, and other non-blockchain sales.
Additionally, Animoca Brands saw $21 million in bookings from investment activity, which includes realized gains from digital asset investments and investment management fees from Animoca Ventures. These revenue streams accounted for 35% of the company’s total bookings for 2023.
**Operating Expenses and Company Assets**
Animoca Brands reported operating expenses of $246 million for the year ending December 31, 2023, which is slightly higher than the $234 million reported in 2022. This increase can be attributed to the addition of new subsidiaries operating under Animoca Brands as a result of acquisitions in 2022. However, cost reduction initiatives across all subsidiaries and the introduction of a new business line offering digital asset advisory services helped offset this increase. In fact, operating expenses decreased by 9% in the second half of 2023 compared to the first half.
As of December 31, 2023, Animoca Brands had cash and stablecoin balances of $175 million and digital assets held on the balance sheet worth $203 million. The company also had off-balance sheet token reserves of approximately $1.6 billion, which included liquid tokens and lower-liquidity tokens. These reserves consisted of tokens listed on top-tier exchanges as well as lower-tier exchanges or decentralized exchanges.
**Key Business Highlights**
Throughout 2023, Animoca Brands focused on developing, expanding, and funding its products, services, and subsidiaries to further diversify its business. The company successfully expanded its Digital Asset Advisory (DAA) business, which accounted for 27% of total bookings in 2023. The DAA business provides token advisory, tokenomics, marketing, listing, node operation, and trading services to Web3 projects sourced from Animoca Brands’ minority investment portfolio.
Animoca Brands also made significant advancements in its other key business lines. It launched Open Campus, a decentralized platform that aims to revolutionize the education sector by connecting learners, educators, content creators, and educational institutions using blockchain technology. The platform’s governance and utility token, EDU Token, has gained traction and has been used for various educational purposes.
The company’s Mocaverse initiative aims to build the largest Web3 game publishing platform by leveraging its ecosystem of subsidiaries, projects, portfolio companies, shareholders, and partners. Mocaverse has attracted numerous users and partners since its launch and continues to grow.
**Partnerships and Thought Leadership**
Animoca Brands formed strategic partnerships with various organizations to advance the Web3 and gaming ecosystems. It partnered with TON Foundation to integrate Web3 gaming into Telegram, a platform with over 800 million users. The company also entered into a strategic partnership with Neom in Saudi Arabia to drive regional Web3 initiatives and establish a physical Web3 hub in Riyadh.
The thought leadership of Animoca Brands’ executives was recognized as well. Yat Siu, the co-founder and Executive Chairman of Animoca Brands, gave a TED Talk titled “The Dream of Digital Ownership, Powered by the Metaverse,” which received positive reception. Robby Yung, CEO of Investments at Animoca Brands, was invited to present to the United Kingdom All Party Parliamentary Group on Metaverse and Web3 and the United Kingdom All Parliamentary Group on Blockchain Technologies, where he shared insights on Web3 adoption and growth.
**Q1 2024 Financial Highlights**
In the first fiscal quarter of 2024, Animoca Brands reported unaudited bookings of $90 million, representing a 72% increase compared to the first quarter of 2023. The majority of these bookings came from the Digital Asset Advisory business and other projects driven by Animoca Brands headquarters.
Operating expenses for the first quarter of 2024 were $55 million, a 14% decrease compared to the same period in 2023. This reduction in expenses reflects the company’s cost reduction initiatives.
As of March 31, 2024, Animoca Brands had cash and stablecoin balances of $291 million and liquid third-party digital assets of $558 million. The company also reported off-balance sheet token reserves of $1.8 billion, which included tokens issued by its majority-owned Web3 subsidiaries.
**Conclusion**
Despite facing challenges in the Web3 market and experiencing a decrease in bookings in 2023, Animoca Brands has demonstrated resilience and adaptability. The company has successfully expanded its business lines, formed strategic partnerships, and received recognition for its thought leadership. With its strong financial position and continued growth in Q1 2024, Animoca Brands is well-positioned to capitalize on the opportunities presented by the evolving Web3 landscape.