GameSquare receives Nasdaq compliance extension

GameSquare Holdings, Inc. (NASDAQ:GAME), an entertainment and esports company with a market capitalization of $28.5 million and current stock price of $0.87, has been granted an extension by the Nasdaq to address compliance issues related to the timing of its annual shareholder meeting. According to InvestingPro data, the company’s shares have declined 44% over the past year, while trading at relatively low revenue multiples. On January 23, 2025, GameSquare received a notification from Nasdaq stating that the company had not held an annual meeting within twelve months following the end of its fiscal year on December 31, 2023, as required by Nasdaq Listing Rules.

The company, which conducted a special shareholders meeting on February 27, 2024, believes it has complied with the rules, citing its previous status as a British Columbia entity before changing its domicile to Delaware on March 7, 2024. GameSquare argues that its governance under former Articles of Incorporation should be taken into account. InvestingPro analysis reveals concerning financial metrics, including negative EBITDA of -$22.8 million and weak gross profit margins of about 20%.

Despite the notification, GameSquare’s securities continue to be listed on the Nasdaq Capital Market without immediate impact. The company has proactively scheduled its annual meeting for March 12, 2025, in anticipation of resolving the issue and had informed Nasdaq of this planned meeting before receiving the notice.

Nasdaq has provided GameSquare until the scheduled annual meeting date to regain compliance with the listing requirements. GameSquare remains committed to fulfilling all necessary conditions to maintain its listing status.

This report is based on a press release statement and does not include any assumptions or predictions about the company’s future performance or market position.

In other recent news, GameSquare Holdings, Inc. reported significant financial developments. The company announced a 10% year-over-year increase in its third-quarter revenue for 2024, reaching a record $26.4 million. In addition, GameSquare saw a substantial decrease in its adjusted EBITDA loss, dropping to $2.2 million from a pro forma loss of $10.4 million in the same quarter of the previous year.

GameSquare has also settled its outstanding convertible note and terminated its standby equity purchase agreement with Yorkville Advisors Global L.P. The company issued a zero-coupon, 60-day promissory note to Yorkville, financed by GameSquare’s existing cash reserves.

In other company news, GameSquare successfully integrated the gaming organization FaZe Clan, acquired in March 2024, into its operations. This acquisition has aided in securing significant investments and is expected to contribute to GameSquare’s goal of achieving profitability by 2025.

The company’s CEO, Justin Kenna, highlighted growth in higher-margin business areas and a strong pipeline of 7-figure deals. He also expressed confidence in the company’s future performance and plans to provide further updates in Q4 2024. These recent developments are part of GameSquare’s ongoing efforts to expand its market presence and improve profitability.

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