Motorsport Games Reports First Quarter 2026 Financial Results
Rhea-AI Summary
Motorsport Games (NASDAQ: MSGM) reported Q1 2026 revenue of $4.0 million, up 129.3% from $1.8 million a year earlier. Gross profit rose to $3.5 million with an 87.2% margin. Net income was $1.0 million, matching Q1 2025, while Adjusted EBITDA increased to $1.53 million.
The company averaged about $0.5 million positive monthly operating cash flow and secured a $3.0 million Citibank revolving credit line. It repurchased 904,395 Class A shares and cancelled all Class B shares, funded partly by a $1.2 million loan draw.
Positive
- Revenue increased 129.3% year-over-year to approximately $4.0 million
- Gross profit rose to $3.5 million with 87.2% gross margin
- Adjusted EBITDA grew to $1.53 million from $0.61 million
- Average operating cash flow about $0.5 million per month in Q1 2026
- Secured a $3.0 million revolving credit line with Citibank
- Repurchased 904,395 Class A shares and cancelled all Class B shares
Negative
- Net income flat year-over-year at approximately $1.0 million
- Net income per Class A share declined to $0.06 from $0.33
- Cash and equivalents fell from $5.9 million to $3.8 million after April repurchase
News Market Reaction – MSGM
In the May 14 session, MSGM declined 11.24%, reflecting a significant negative market reaction. Argus tracked a trough of -38.2% from its starting point during tracking. Our momentum scanner triggered 25 alerts that day, indicating elevated trading interest and price volatility. Trading volume was above average at 1.5x the daily average, suggesting increased trading activity.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Mar 10 | FY25 earnings | Positive | -10.1% | Reported FY2025 profit with revenue growth and improved cash position. |
| Nov 06 | Q3 2025 earnings | Positive | +70.8% | Strong Q3 2025 revenue growth, margin expansion and positive EPS. |
| Aug 13 | Q2 2025 earnings | Positive | -11.2% | Q2 2025 profit and higher revenue but with noted liquidity concerns. |
| May 09 | Q1 2025 earnings | Neutral | -4.4% | Turned profitable in Q1 2025 despite lower revenue and liquidity issues. |
| Mar 20 | FY24 earnings | Neutral | -0.8% | Mixed FY2024 with higher revenue but continuing net loss and funding needs. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Earnings releases have often produced sharp but inconsistent moves, with multiple instances of negative reactions to seemingly strong results.
Over the past year, MSGM’s earnings reports have marked a transition from losses in 2024 to profitability in 2025. Events on Mar 10, 2026 and earlier quarters highlighted rising revenue, expanding margins, and improving cash. Market reactions have been volatile and sometimes counterintuitive, with both strong rallies (e.g., Q3 2025) and sizable selloffs following positive financial updates. Today’s Q1 2026 results continue the profitability trend, with higher revenue and margins versus prior-year quarters.
Key Terms
adjusted EBITDA financial
EBITDA financial
non-GAAP financial measures financial
U.S. GAAP regulatory
stock-based compensation financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
MIRAMAR, Fla., May 13, 2026 (GLOBE NEWSWIRE) -- Motorsport Games Inc. (NASDAQ: MSGM) (“Motorsport Games” or “the Company”) today reported financial results for its first quarter ended March 31, 2026. The Company has also posted the first quarter 2026 earnings slides highlighting key milestones that occurred during and subsequent to the period, which are accessible on the Company’s investor relations website.
“We are very pleased to report another quarter of strong financial performance, with revenues more than doubling year on year. The progress we have made in transforming this business is now visibly consistent. We have once again generated positive operating income, supported by the ongoing momentum of our Le Mans Ultimate title and the steady expansion of our RaceControl subscription platform,” commented Stephen Hood, President and Chief Executive Officer of Motorsport Games.
“Player engagement with Le Mans Ultimate has continued to accelerate into 2026. In March, we recorded an all-time peak of more than 8,800 concurrent players upon the release of Version 1.3. This update introduced Circuit de Barcelona-Catalunya, the Duqueine D09 LMP3 race car, and Logitech Trueforce support, amongst other improvements, and has been particularly well received, reinforcing the consistent relentless cadence of meaningful improvements our community has come to expect from our development team. Within this release we also saw the fruit of some early console development improvements with a new user interface framework that is vital for release on these platforms.”
“With the financial stability we have now established, we have begun to explore the next phase of growth for Motorsport Games. Le Mans Ultimate has demonstrated that our technology platform, our development approach and our community engagement strategy can deliver a profitable, scalable business, and we continue to work on plans to expand our portfolio, taking Le Mans Ultimate to console and future possible titles. Our recent share repurchase from Driven Lifestyle Group LLC is a direct reflection of how far the Company has come – our strengthened financial position has given us the ability to act, returning greater ownership and strategic influence to the Company and ultimately to the benefit of all shareholders.”
First Quarter 2026 Highlights and Subsequent Business Update
| ● | Generated revenues of | |
| ● | Generated net income of | |
| ● | Net income attributable to Class A common stock was | |
| ● | Adjusted EBITDA of | |
| ● | Released Le Mans Ultimate Version 1.3 in March 2026, introducing Circuit de Barcelona-Catalunya, the Duqueine D09 LMP3 race car, new track layouts, Logitech Trueforce support and performance improvements. | |
| ● | Secured a | |
| ● | Entered into a Share Repurchase Agreement with Driven Lifestyle Group LLC on April 22, 2026, pursuant to which the Company purchased 904,395 shares of its Class A Common Stock and cancelled all outstanding shares of its Class B common stock. |
Select Financial Highlights for the Three Months Ended March 31, 2026
Revenue for the first quarter of 2026 was approximately
Net income for the first quarter of 2026 and 2025 was approximately
Adjusted EBITDA(1) for the first quarter of 2026 was
The following table provides a reconciliation from net income to Adjusted EBITDA(1) for the first quarter of 2026 and 2025, respectively:
| Three Months Ended March 31, 2026 | Three Months Ended March 31, 2025 | ||||||||
| Net income | $ | 951,573 | $ | 1,022,613 | |||||
| Interest expense, net | 3,205 | 13,010 | |||||||
| Depreciation and amortization (1) | 176,049 | 252,057 | |||||||
| EBITDA | 1,130,827 | 1,287,680 | |||||||
| Gain from settlement of purchase commitment liabilities | - | (175,460 | ) | ||||||
| Gain from Settlement Agreement | - | (500,000 | ) | ||||||
| Impairment of intangible assets | 27,928 | - | |||||||
| Stock-based compensation | 375,031 | - | |||||||
| Adjusted EBITDA | $ | 1,533,786 | $ | 612,220 | |||||
| (1) | Includes | ||||||||
Cash Flow and Liquidity
As of March 31, 2026, the Company had cash and cash equivalents of approximately
(1)Use of Non-GAAP Financial Measures
Adjusted EBITDA (the “Non-GAAP Measure”) is not a financial measure defined by U.S. generally accepted accounting principles (“U.S. GAAP”). Reconciliations of the Non-GAAP Measure to net income, its most directly comparable financial measure, calculated and presented in accordance with U.S. GAAP, are presented in the tables above.
Adjusted EBITDA, a measure used by management to assess the Company’s operating performance, is defined as EBITDA, which is net income plus interest expense, depreciation and amortization, less income tax benefit (if any), adjusted to exclude: (i) gain from settlement of license liabilities and other agreements; (ii) gain from sale of gaming licenses; (iii) impairment of intangible assets; (iv) loss contingency expenses; and (v) stock-based compensation expenses.
The Company uses the Non-GAAP Measure to manage its business and evaluate its financial performance, as Adjusted EBITDA eliminates items that affect comparability between periods that the Company believes are not representative of its core ongoing operating business. Additionally, management believes that using the Non-GAAP Measure is useful to its investors because it enhances investors’ understanding and assessment of the Company’s normalized operating performance and facilitates comparisons to prior periods and its competitors’ results (who may define Adjusted EBITDA differently).
The Non-GAAP Measure is not a recognized term under U.S. GAAP and does not purport to be an alternative to revenue, income/loss from operations, net (loss) income, or cash flows from operations or as a measure of liquidity or any other performance measure derived in accordance with U.S. GAAP. Additionally, the Non-GAAP Measure is not intended to be a measure of free cash flows available for management’s discretionary use, as it does not consider certain cash requirements, such as interest payments, tax payments, working capital requirements and debt service requirements. The Non-GAAP Measure has limitations as an analytical tool, and investors should not consider it in isolation or as a substitute for the Company’s results as reported under U.S. GAAP. Management compensates for the limitations of using the Non-GAAP Measure by using it to supplement U.S. GAAP results to provide a more complete understanding of the factors and trends affecting the business than would be presented by using only measures in accordance with U.S. GAAP. Because not all companies use identical calculations, the Non-GAAP Measure may not be comparable to other similarly titled measures of other companies.
Conference Call and Webcast Details
The Company will host a conference call and webcast at 5:00 p.m. ET today, May 13, 2026, to discuss its financial results. The live conference call can be accessed by dialing 1-800-267-6316 or 1-203-518-9783 and using Conference ID “MOTOR”. Alternatively, participants may access the live webcast on the Motorsport Games Investor Relations website at https://ir.motorsportgames.com under “Events.”
About Motorsport Games:
Motorsport Games is a racing game developer, publisher and esports ecosystem provider of official motorsport racing series. Combining innovative and engaging video games with exciting esports competitions and content for racing fans and gamers, Motorsport Games strives to make racing games that are authentically close to reality. The Company is the officially licensed video game developer and publisher for iconic motorsport racing series including the 24 Hours of Le Mans and the FIA World Endurance Championship, recently releasing Le Mans Ultimate Version 1.3 featuring new cars, updated content and additional improvements. Motorsport Games also owns the industry leading rFactor 2 and KartKraft simulation platforms. rFactor 2 also powers F1® Arcade through a partnership with Kindred Concepts. Motorsport Games is also an award-winning esports partner of choice for the 24 Hours of Le Mans, creating the renowned Le Mans Virtual Series. Motorsport Games is building a virtual racing ecosystem where each product drives excitement, every esports event is an adventure, and every race inspires.
For more information about Motorsport Games visit: www.motorsportgames.com.
Forward-Looking Statements
Certain statements in this press release, the related conference call and webcast which are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are provided pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements or information in this press release, the related conference call and webcast that are not statements or information of historical fact may be deemed forward-looking statements. Words such as “continue,” “will,” “may,” “could,” “should,” “expect,” “expected,” “plans,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, but are not limited to, statements concerning the ongoing momentum of the Le Mans Ultimate title and the steady expansion of the RaceControl subscription platform; the cadence of meaningful improvements from the Company’s development team; the next phase of the Company’s growth; the potential of the Company’s technology platform, development approach, and community engagement strategy to deliver a profitable, scalable business; plans to expand the Company’s portfolio, including taking Le Mans Ultimate to console; and the Company’s strengthened financial position, ability to act, and their benefit to the Company’s shareholders.
All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside of the Company’s control and are difficult to predict. Examples of such risks and uncertainties include, but are not limited to: (i) difficulties, delays or less than expected results in achieving the Company’s growth plans, objectives and expectations, including delays in the release of new game versions and features, the Company’s inability to deliver new products and/or new content or features for existing products, and/or the Company’s inability, in whole or in part, to continue to execute its business strategies and plans, such as due to less than anticipated customer acceptance of its new game titles and/or less than anticipated benefits from its future technologies, the Company experiencing difficulties or the inability to launch its games as planned, less than anticipated performance of the games impacting customer acceptance and sales and/or greater than anticipated costs and expenses to develop and launch its games, including, without limitation, higher than expected labor costs, the Company’s inability to establish partnerships with additional service providers to come onboard to the Company’s ecosystem and, (ii) difficulties, delays in or unanticipated events that may impact the timing and scope of new or planned products, features, events or other offerings; (iii) less than expected benefits from implementing the Company’s management strategies and/or adverse economic, market and geopolitical conditions that negatively impact industry trends, such as significant changes in the labor markets, an extended or higher than expected inflationary environment, a higher interest rate environment, tax increases impacting consumer discretionary spending and/or quantitative easing that results in higher interest rates that negatively impact consumers’ discretionary spending; and (iv) greater than anticipated negative operating cash flows such as due to higher than expected development costs, higher interest rates and/or higher inflation.
Factors other than those referred to above could also cause the Company’s results to differ materially from expected results. Additional examples of such risks and uncertainties include, but are not limited to: (i) the Company’s ability (or inability) to maintain existing, and to secure additional, licenses and other agreements with various racing series; (ii) the Company’s ability to successfully manage and integrate any joint ventures, acquisitions of businesses, solutions or technologies; (iii) unanticipated operating costs, transaction costs and actual or contingent liabilities; (iv) the ability to attract and retain qualified employees and key personnel; (v) adverse effects of increased competition; (vi) changes in consumer behavior, including as a result of general economic factors, such as increased inflation, higher energy prices and higher interest rates; (vii) the Company’s inability to protect its intellectual property; and/or (vii) local, industry and general business and economic conditions.
Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the Company’s filings with the SEC, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2025, subsequent Quarterly Reports on Form 10-Q and current reports on Form 8-K filed with the SEC. The Company anticipates that subsequent events and developments may cause its plans, intentions and expectations to change. The Company assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law. Forward-looking statements speak only as of the date they are made and should not be relied upon as representing the Company’s plans and expectations as of any subsequent date.
Website and Social Media Disclosure
Investors and others should note that we announce material financial information to our investors using our investor relations website (ir.motorsportgames.com), SEC filings, press releases, public conference calls and webcasts. We use these channels, as well as social media and blogs, to communicate with our investors and the public about our company and our products. It is possible that the information we post on our websites, social media and blogs could be deemed to be material information. Therefore, we encourage investors, the media and others interested in our company to review the information we post on the websites, social media channels and blogs, including the following (which list we will update from time to time on our investor relations website):
| Websites | Social Media | |
| motorsportgames.com | Twitter: @msportgames | |
| Instagram: msportgames | ||
| Facebook: Motorsport Games | ||
| LinkedIn: Motorsport Games |
The contents of these websites and social media channels are not part of, nor will they be incorporated by reference into, this press release.
Contacts:
Investors:
Media:
Appendix:
The following tables provide a comparative summary of the Company’s financial results for the periods presented:
| MOTORSPORT GAMES INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | |||||||||
| Three Months Ended March 31 , | |||||||||
| 2026 | 2025 | ||||||||
| Revenues [1] | $ | 4,031,289 | $ | 1,758,453 | |||||
| Cost of revenues | 517,137 | 465,386 | |||||||
| Gross profit | 3,514,152 | 1,293,067 | |||||||
| Operating expenses: | |||||||||
| Sales and marketing | 210,319 | 97,701 | |||||||
| Development | 514,337 | 601,953 | |||||||
| General and administrative [2] | 1,698,631 | 1,168,482 | |||||||
| Impairment of intangible assets | 27,928 | - | |||||||
| Depreciation and amortization | 6,516 | 18,126 | |||||||
| Total operating expenses | 2,457,731 | 1,886,262 | |||||||
| Other operating income | - | 500,000 | |||||||
| Income (loss) from operations | 1,056,421 | (93,195 | ) | ||||||
| Interest expense, net | (3,205 | ) | (13,010 | ) | |||||
| Other (expense) income, net | (101,643 | ) | 1,128,818 | ||||||
| Net income | 951,573 | 1,022,613 | |||||||
| Less: Net income (loss) attributable to non-controlling interest | 635,746 | (18,445 | ) | ||||||
| Net income attributable to Motorsport Games Inc. | $ | 315,827 | $ | 1,041,058 | |||||
| Net income per Class A common share attributable to Motorsport Games Inc.: | |||||||||
| Basic | $ | 0.06 | $ | 0.33 | |||||
| Diluted | $ | 0.06 | $ | 0.33 | |||||
| Weighted-average shares of Class A common stock outstanding: | |||||||||
| Basic | 5,456,286 | 3,183,558 | |||||||
| Diluted | 5,482,458 | 3,183,558 | |||||||
| [1] | Includes related party revenues of | ||||||||
| [2] | Includes related party expenses of | ||||||||
A photo accompanying this announcement is available at:
https://www.globenewswire.com/NewsRoom/AttachmentNg/f1e0e6b9-22c0-4625-9815-e7ed1545d623
