Motorsport Games Inc.

First-half 2026 revenue was $7.6 million, up 74% year over year. Gross profit was $6.4 million, up 86.9% year over year, with gross margin expanding to 84.7% from 78.8%. Q2 adjusted EBITDA was $0.8 million versus $1.4 million in Q2 2025, and adjusted diluted EPS was $0.19 versus $0.25 a year ago. For the first half, adjusted EBITDA was $2.2 million versus $1.0 million last year, and adjusted diluted EPS was $0.33 versus $0.24. RaceControl subscription revenue was about $1.4 million in H1 versus about $0.3 million a year ago, and paid subscribers ended June at over 40,500. The company said it generated operating cash flow of about $0.5 million per month over the first half, ended June with $3.9 million in cash and cash equivalents, and had $1.2 million drawn on its $3 million Citi revolver. Management did not provide formal forward guidance, but said U.S. Track Pack 2 and 3 are expected in September and December, respectively, and that additional Le Mans Ultimate content is being explored for 2027.

Stephen Hood framed the quarter as further proof that the business model is working, emphasizing six consecutive profitable quarters, rising efficiency, and the growing importance of RaceControl. He said Le Mans Ultimate engagement accelerated, with April as the highest-ever month for average daily active users and ongoing DLC monetization showing the game resonates with players. His tone was upbeat and strategic, focusing on the company moving from recovery to growth, expanding addressable audience, and building a broader ecosystem around sim racing.

Peter Hansen-Chambers focused on the mechanics behind the growth: RaceControl subscription revenue was about $1.4 million in H1, annual recurring revenue was about $2.9 million, and paid subscribers exceeded 40,500. He highlighted H1 revenue of $7.6 million, gross profit of $6.4 million, and gross margin of 84.7%, while noting Q2 adjusted EBITDA of $0.8 million and H1 adjusted EBITDA of $2.2 million. On the balance sheet, he said operating cash flow averaged about $0.5 million per month, cash and cash equivalents were $3.9 million at June 30, 2026, and the company had $1.2 million drawn on its $3 million Citi revolver, which was extended to February 2028.

Analysts asked about the July U.S. Track Pack, RaceControl’s subscription trajectory and retention, subscriber acquisition costs, and the competitive environment. Management said the U.S. Track Pack has been received very well and is outperforming expectations, with two more content releases planned later in the year; on RaceControl, they said the run rate is $2.9 million, retention initiatives are working, and organic acquisition keeps costs very low. They also said conversion is already above a 5% benchmark they cited from mobile free-to-play, so they are not focused on paid acquisition right now.