Bidstack Group (AIM: BIDS.L) outlined in a trading update this morning that it is on track to exceed market expectations in respect of revenues for the year ending 31 December 2020.
The native in-game advertising platform said it has experienced ‘significantly increased demand’ from advertisers in the second half of 2020. The company informed investors that it has been ‘working hard’ on both the demand and supply side strategies of its business.
On the supply side, Bistack continues to work closely with several global international ad agencies and brands. It said it was now receiving advertising briefs evolving from test spend to being "on plan" ‘as the desire to reach the attractive video gaming audience grows.’
Commenting on the group’s trading performance, James Draper, CEO of Bidstack, said: "In the second half of 2020 we have been conducting our work with quiet efficiency. Over that period we have seen a step change in interest from brands wanting to activate within gaming.”
Its supply-side strategy continues to focus on working with a number of the world's largest video games developers and publishers to incorporate Bidstack’s technology into their games.
He added, “We are witnessing average order values increasing significantly and experiencing advertising agencies now including in-game advertising as a component in large media plans. We believe this is a meaningful shift from where the market was 12 months ago.”
Bidstack said the strategy has proved complex but that it is now placing advertising and successfully generating revenues in core markets with some of the world's largest video games publishing groups.
In addition, Bidstack said it is considering a number of new commercial opportunities “where its technical offering and insight may be of interest to some global technology led companies.”
Draper said, “We are at the beginning of a new industry, where brands will continue to explore and invest in ways to activate and protect their IP in and around interactive entertainment.
He added, “The diligent work of our growing team, the knowledge we have accumulated, and the demonstrable acceleration of revenue being run through our products put Bidstack in a strong position to capitalise on this growth."
The Company said it intends to make a further announcement with ‘a more detailed update’ on the Group's performance for the year ending 31 December 2020 in early 2021.
Shares in Bidstack Group have increased by nearly 18% this morning following the announcement.
Bidstack provides in-game advertising for the global video games industry across multiple platforms. Its proprietary technology is capable of inserting adverts into natural advertising space within video games.
Bidstack's customers are games publishers and developers (on the supply side), and advertising agencies, brands and programmatic advertising platforms (on the demand side).
Back in September 2020, Bidstack signed an exclusive partnership agreement with Ubisoft, a leading video game cfirm, to deliver native in-game advertising for video game, Hyper Scape.
The partnership followed Bidstack's strategy to focus on working with leading video games developers and publishers to incorporate its proprietary technology into their games.
"This deal shows the progress the business has made over the last two years,” said CEO, James Draper, adding, “The team at Ubisoft has become a close partner, and together we're excited to empower advertisers to run campaigns within the cross-platform battle royale Hyper Scape.”
In a half-year results published last month, Draper said Bidstack has made material progress on the demand-side in its first half as it sees advertisers moving beyond initial test spends.
Financially, the group posted revenues for 1H20 of £0.3m up from £0.03m for the period ended 30 June 2019 with £5.9m of cash after an oversubscribed £5.7m equity raise in June.
Bidstack said the proceeds leave it in ‘a healthy cash position’ to pursue its business plans, which clearly include working exclusively with Ubisosft on HyperScape.
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