The future of Motorsport Games remains in doubt, now more than ever.
Ahead of the company’s full year earnings call for 2023, it published its annual report SEC filing that includes all of the latest information surrounding the company. Well, almost all of it.
According to the report, Motorsport Games lost $14.3 million in 2023 with an accumulated deficit of $87 million. In addition to the money lost and deficit, the company currently has just $1.3 million cash on hand as of March 29, 2024 with a monthly burn rate of $1.1 million.
“As a result of our financial condition, management has concluded that there is substantial doubt in our ability to continue as a going concern,” the report reads.
Should the company not be able to secure the additional funding necessary to continue, it suggests a number of other options such as “selling additional assets or operations” or “discontinuing operations”.
“We will require additional capital to meet our financial obligations, and this capital might not be available on acceptable terms or at all,” the company said.
“We expect to continue to incur losses for the foreseeable future as we continue to incur significant expenses.”
Back in October, Motorsport Games sold its NASCAR license to iRacing for $6 million total. With the NASCAR license no longer in house, Motorsport Games says it will have to look for additional revenue streams once it’s limited license to sell its current NASCAR products expires at the end of 2024.
In 2023, NASCAR gaming products accounted for 73% of all Motorsport Games revenue. That’s a number the company says will drop over time.
In addition to the money lost from losing the NASCAR license, Motorsport Games was involved in multiple lawsuits that were filed against the company for unpaid wages in 2023. Those specific lawsuits, which were filed in Russia, aren’t mentioned in the report.
As far as future game planning, Motorsport Games says that it may look more into the free-to-play and mobile market. The studio also is continuing support for rFactor 2 and the recently released Le Mans Ultimate.
Currently, the company has no planned releases for 2024. The studio employees 71 people as of December 31, 2023, 52 of which are developers.
