MPL’s Loss Surges 3X YoY To $149 Mn In FY22 As Marketing Expenses Jump To $92 Mn

MPL (Mobile Premier League), India’s third most-valued gaming startup, reported a 3X surge in its loss to $149.3 Mn in the financial year 2021-22 (FY22) from $48.3 Mn in FY21.

M-League Pte Ltd, the Singapore-based parent entity of MPL, saw its revenue from operations increase only 29% to $65.6 Mn in FY22 from $50.8 Mn in FY21, a year when mobile gaming peaked as people stayed indoors amidst COVID-19 lockdowns. 

The parent entity has two main streams of revenue – gaming and sale of merchandise. It gets most of its revenue by rendering gaming experience to users on its gaming platform. The company retains a part of the entry fees deposited by users for organising the gameplay. Besides, it also organises various contests, events, and leaderboard awards within its gaming platform. 

MPL earned $63.8 Mn through online gaming in FY22, a rise of 25.5% from $50.8 Mn in FY21. The startup offers real-money gaming in over 60 games such as ludo, chess, fantasy sports, card, carrom, among others. 

Meanwhile, the parent entity sells merchandise through its subsidiary Nereus Sport Products Private Limited – the entity that operates MPL Sports. As per the filings, Nereus Sport earned $1.4 Mn from sale of merchandise in FY22 as against $93K in the previous fiscal year. 

India continued to remain the top market for MPL, contributing more than 88% to the startup’s total revenue of $66.8 Mn. Revenue from India stood at $58.3 Mn in FY22, while Europe – the startup’s latest bet – generated revenue of $6.7 Mn. The US contributed $557K in revenue in FY22. 

It must be noted that MPL acquired German game studio GameDuell in February this year to expand its business operations in Europe. 

On the expenses front, total expenses jumped 116.2% to $215 Mn from $99.4 Mn in FY21. Advertising and promotional expenses, which rose 81% to $92.2 Mn from $50.9 Mn in FY21, contributed 43% of the total expenses. 

Notably, MPL Sports, which replaced Nike as the sponsor for the Indian cricket team jersey, is now reportedly looking to exit the sponsorship agreement it signed with the Board of Control for Cricket in India (BCCI). 

MPL which is cofounded by Sai Srinivas and Shubh Malhotra also spent $58.6 Mn on employee benefit expenses in FY22, a 255% jump from $16.5 Mn in FY21. Employee benefit expenses comprise employee salaries, gratuity, PF contribution, and other employee benefits. 

Amid the ongoing funding winter, MPL, like many other startups, has been trying to cut costs and become profitable. In May this year, the gaming unicorn laid off more than 100 employees and exited Indonesia, one of its cash guzzling markets.  

According to a TechCrunch report, MPL was also in talks to raise a new round of investment from now bankrupt crypto exchange FTX. However, the deal couldn’t be finalised. 

MPL, which turned unicorn in 2021, has also been involved in legal battles with various state governments over a host of issues in the absence of clear regulations for online gaming. While Dream11 is the primary competitor of MPL, the latter has also been facing a stiff challenge from WinZo games and Junglee Games.

MPL is currently doubling down on its gaming studio Mayhem Studios. However, the gaming studio, launched last year, is yet to come out with a game that becomes a hit amongst its users.

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