GameSquare 2025 Q2 Earnings Narrowed Losses But Misses Revenue Targets

GameSquare (GAME) reported its fiscal 2025 Q2 earnings on August 14, 2025, with revenue falling short of expectations and losses narrowing. The company posted a net loss of $3.02 million, representing a 74.9% reduction from the $12 million loss in the same period last year. While this marks a significant improvement, the results still reflect ongoing financial challenges.

Revenue
GameSquare’s total revenue in Q2 2025 declined by 11.1% year-over-year to $15.85 million. The SaaS and Advertising segment remained the largest contributor, bringing in $11.84 million, while the Teams and Agency segments generated $1.81 million and $2.21 million, respectively. Despite strategic cost-cutting measures, the company faced revenue headwinds, with no segment showing a notable increase compared to the prior year.

Earnings/Net Income
GameSquare narrowed its per-share loss to $0.08 in Q2 2025, compared to $0.38 in Q2 2024, representing a 78.9% improvement. However, the company still posted a net loss of $3.02 million for the quarter, continuing a streak of losses over the last eight years. While the reduction in losses is a positive sign, the earnings do not represent a significant turnaround in profitability.

Price Action
The stock price of GameSquare has declined sharply in recent periods, with a 1.13% drop on the latest trading day and a 7.97% loss for the week. Over the past month, the share price has plummeted by 41.07%, reflecting continued investor skepticism and a challenging market environment for the company.

Post Earnings Price Action Review
A strategy of buying GameSquare shares on the date of its quarterly revenue announcement and holding for 30 days has historically resulted in a -10% return over the past three years. The company’s quarterly revenue has shown significant variability, with Q2 2025 following a downward trend that has persisted since 2023. While there have been brief periods of positive movement, such as Q1 2025 when the Ethereum-based treasury strategy launched, the overall trend has been negative. Holding shares post-announcement has consistently underperformed, underscoring the risks associated with investing in GameSquare during its current financial phase.

CEO Commentary
CEO Justin Kenna emphasized the company’s strong operating momentum and progress in reducing SG&A expenses by 15% and improving gross margin by 120 basis points, leading to a 16% adjusted EBITDA improvement year-over-year. He highlighted the successful divestiture of FaZe Media and the Ethereum-based treasury strategy, which has generated $19 million in unrealized gains. Kenna expressed optimism about Q3 and Q4 2025 growth, citing a robust sales pipeline, new wins like the Azuki deal, and ongoing restructuring efforts.

Guidance
GameSquare anticipates stronger revenue in the second half of 2025, with Q3 expected to exceed Q2 and Q4 to build on that growth. The company expects 60% of its 2025 revenue to be generated in the back half of the year, supported by seasonal trends and a more profitable revenue mix. Additional restructuring initiatives are projected to yield $5 million in annualized savings by the end of Q3. The company plans to reintroduce full-year guidance in Q3, reflecting confidence in its operating business and onchain yield strategy, which is targeting annualized returns of 8% to 14%.

Additional News
On August 15, 2025, Nigeria’s inflation rate dropped to 21.88% in July, according to the National Bureau of Statistics. Meanwhile, the Economic and Financial Crimes Commission (EFCC) arrested five individuals in Akwa Ibom state for illegal mining. In politics, Nigeria’s two dominant parties, the PDP and APC, rejected a Canadian court judgment labeling them as terrorist organizations. In entertainment, gospel singer Mercy Chinwo welcomed her second child, and Chocolate City Group announced a new vice president.