Snail (SNAL 6.37%), best known for its popular ARK franchise in the gaming industry, released its second quarter 2025 results on August 19, 2025. The standout headline from this release was a top-line GAAP revenue of $22.2 million, missing Wall Street’s GAAP estimate of $26.0 million by 14.6%. While earnings per share (GAAP) matched analyst expectations at $(0.01), the GAAP revenue miss, rising operating costs, and a substantial net loss marked a period of financial pressure, despite strong player engagement across its flagship titles. The quarter saw noteworthy growth in bookings (non-GAAP) and daily active users, but margins came under pressure due to a combination of expense hikes and a major write-down in deferred tax assets.
Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
---|---|---|---|---|
EPS (GAAP) | $(0.44) | $(0.01) | $0.06 | (833.3%) |
Revenue (GAAP) | $22.2 million | $26.0 million | $21.6 million | 2.8% |
Bookings (Non-GAAP) | $27.1 million | $22.9 million | 18.4% | |
EBITDA (Non-GAAP) | $(2.4 million) | $3.1 million | N/A |
Source: Analyst estimates for the quarter provided by FactSet.
Snail is a developer and publisher in the gaming space, known for sandbox survival games and a growing portfolio of digital entertainment. It built much of its business around the ARK franchise, which spans PC, console, and mobile platforms. The franchise is central to the company’s finances, generating 85.1% of total revenue in 2024.
Recently, Snail sharpened its focus on a few key areas: maintaining the ARK series' dominance, advancing technology, building external partnerships, and diversifying into new game genres and digital media such as short films. Key success factors for the company include the ability to engage a large and active player community, manage licensing costs, and extend its technology into new offerings.
The ARK franchise stood out during the quarter. ARK: Survival Evolved, a sandbox survival game, sold approximately 1,196,583 units, while ARK: Survival Ascended reached 807,065 units. Mobile engagement also grew, with ARK Mobile surpassing 6.9 million downloads as of June 30, 2025 and averaging 104,135 daily active users. Notably, a PlayStation Plus promotion drove 8 million downloads for ARK: Survival Ascended in May 2025, reflecting new audiences gained through subscription channels.
Engagement metrics showed strong user activity: ARK: Survival Evolved averaged 156,947 daily players and peaked at 258,708 on a single day. ARK: Survival Ascended registered 84,585 average daily active users and a peak of 163,455. Despite this, revenue growth was limited by higher deferred revenue and a $3.0 million year-over-year decline in Bellwright sales, a previously hit indie title now seeing lower traction.
The period also marked a significant expansion of Snail’s game portfolio. It celebrated Bellwright’s one-year Early Access milestone, rolled out new content, and launched fresh titles—Robots of Midnight and Zombie Rollerz: The Last Ship (both adventure/indie games). The company’s Wandering Wizards publishing arm picked up rights for several new indie projects, broadening its reach beyond sandbox survival games into new genres.
Diversification reached outside gaming. Snail’s Interactive Films division signed a partnership with Mega Matrix Inc. (an entertainment platform) to launch short dramas globally, pushing into the digital video space. At the same time, the company announced plans to launch a USD-backed stablecoin—a digital asset pegged to the dollar—intending to use this both in its gaming economies and as a new business line. While this stablecoin effort is still in early days, it signals a strategic bet on digital finance, bringing new opportunities but also added regulatory and execution risks.
Underlying all these moves was a material increase in costs. General and administrative expenses increased to $3.5 million from $2.8 million, Research and development expenses were $3.3 million for the three months ended June 30, 2025, and marketing spend doubled to $1.5 million in Q1 2025 compared to the same period last year. The company also recorded a $12.9 million write-down of deferred tax assets, accounting for most of its $13.9 million income tax provision.
Financial health showed pressure points. Cash stood at $7.9 million, a slight increase from the previous year-end but below first quarter levels. Accounts receivable jumped to $17.7 million. Most worrying for long-term stability, current liabilities (GAAP) grew sharply to $55.2 million—much higher than total assets—resulting in negative stockholder equity (GAAP) of $(13.5) million.
Management did not provide new financial guidance for the third quarter or the full year. Instead, it emphasized continuing the stablecoin project and preparing for the launch of upcoming ARK content, especially the ARK: Lost Colony expansion in the second half of 2025.
Investors and observers should pay attention to several areas: the impact of new game and digital media launches on diversification efforts. Special attention will be needed for Snail’s move into digital assets, as execution risks and changes in regulation could significantly affect both financial results and strategic direction.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
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