In a recent financial report aimed at breaking down the firm’s 2022 performance, FaZe Clan reported a loss of $53.2 million. Recently, the company has found itself slipping dramatically, and since going public and being listed on the NASDAQ, the firm’s stock prices have continued to plummet at an alarming rate. FaZe Clan’s net loss equals a whopping $168.5 million, but the majority of this includes a one-off ‘debt extinguishment charge’ that came about by going public.
However, despite the staggering losses, FaZe Clan’s leadership insists that their ‘topline revenue figure’ was in a good place by the end of the year and that they’d almost hit expectations. There was reportedly a 70% increase in brand sponsorship revenue that fuelled most of the firm’s positive performance figures. Not only that but owing to the ongoing success of FaZe Clan’s esports teams, there’s a more or less consistent stream of income being brought in through winnings and merchandise sales.
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FaZe Clan won the Intel Grand Slam just days ago (Image Credit: ESL)
It often seems bizarre that an organisation that started as friends making sniping montages on now-retro Call of Duty titles could report figures like this. Once upon a time, FaZe Clan uploaded YouTube videos for a few thousand subscribers, and today, it’s revealing that in Q4 of 2022, it racked up a $19.1 million net loss. In August 2021, FaZe Clan’s stock value hit an all-time high following its listing on the NASDAQ, but since then, things have turned sour.
At present, the lifestyle brand’s stock value sits at around 0.59 USD, slightly up from the all-time low of 0.40 that was secured a little more than a week ago. Suggestions are circulating that FaZe Clan will need to go private, pulling out of the NASDAQ and reverting to its previous state.
In February, the company was forced to lay off 20% of its staff force to recoup losses and move towards that industry-wide goal of profitability.
Looking at the esports side of things, FaZe’s fortunes appear to be turning around. There was a dry spell for the organisation’s CSGO squad, but following a win at the ESL Pro League Season 17 just days ago, FaZe Clan was crowned the winner of the Intel Grand Slam, netting a $1 million prize. In February, Atlanta FaZe won its first Call of Duty League Major since 2021, securing an admirable prize worth $200,000.
It’s hard to say what the future looks like for FaZe Clan at present, but the organisation had advised that it currently boasts more than $37 million in cash and assets that it can lean on to finance operations long into 2023 and beyond. It’s poised to weather the global economic downturn, but for how long, it’s tough to say.
With layoffs occurring left and right and entire organisations – like The Guard – shutting up shop, it’s a hard time for any company involved in the industry.
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