gpbullhound-2022年第1季度数字媒体洞察（英）-2022-28页_1mb

Q1 2022 Digital Media Sector Summary

Core Content and Key Trends

The Digital Media sector in Q1 2022 continued to evolve with a focus on data capture, audience engagement, and technological innovation. Key trends include:

• Media vs. Big Tech: Media companies are increasingly leveraging their scale and audience data to compete with Big Tech. With the unification of digital ad stacks and the ability to reach large audiences, media giants like Disney and the union of Comcast and NBC Universal are closing the gap with tech giants in terms of data and ad revenue.
• Non-News Content Growth: Readers are shifting their interest from news to lifestyle and culture content. News publishers are adapting by investing in non-news content and using data-driven strategies to convert readers to subscribers.
• Gaming M&A Surge: The gaming industry saw a significant increase in M&A activity, with major deals in Q1 2022 already surpassing the total value of 2021's Western gaming acquisitions. Companies are consolidating to gain scale, IP, and talent, with Web3 and blockchain expected to play a growing role.
• Web3 in Music and Photo: Web3 technologies are reshaping the music industry by enabling direct monetization for artists through NFTs and DAOs. These technologies also offer a secondary market for digital content, though long-term sustainability remains to be seen.

Major M&A Deals

Acquisitions

• AdYouLike – Acquired by OpenWeb (Insight Partners) for $100M
• Busuu – Acquired by Chegg for $436M
• Pinkbike – Acquired by Outside (Undisclosed)
• SpeedTree – Acquired by Unity (Undisclosed)
• Astragon Entertainment – Acquired by Team17 for €100M
• Venatus – Investment by Livingbridge (Undisclosed)
• Photon (Exit Games) – Investment by Skillz for $50M
• GameRefinery – Acquired by Vungle (Undisclosed)

Notable Deals

• Activision Blizzard – Acquired by Microsoft for $68.7B
• Bungie – Acquired by Sony for $3.6B
• Zynga – Acquired by Take Two Interactive for $12.7B

Key Digital Media Investments

• Games | 24 Seven – Invested by Malabar Investments for $75M
• FanCrazy – Invested by Capital Group for $100M
• FRVR – Invested by Hiro Capital for $76M
• Logically. – Invested by Vitruvian for $24M
• linktree – Invested by Coatue for $151M
• VACORP – Invested by Paratus Investment for $80M
• iIMMUTABLE – Invested by Temasek for $200M
• thatgamecompany – Invested by TPG Sequoia for $160M
• triplodot – Invested by 20VC for $180M
• PIXEL – Invested by (01.Advisors) for $100M
• ONE – Invested by TigerGlobal for $60M
• dailyhunt – Invested by The Carlyle Group for $478M
• animoca Brands – Invested by Liberty City Ventures for $359M
• GoStudent – Invested by Prosus Ventures for $340M

Digital Media Indices and Performance

Q1 2022 Index Performance

• Diversified online content and social media: -0.6% decline
• Music, video, photos: -33.7% market cap loss
• Western gaming: +4.1% market cap increase
• Asian gaming: -18.9% market cap loss

2022E EBITDA Margins

• Diversified content: Flat EBITDA margins
• Music, video, photos: Increased EBITDA margin by 10bp
• Western gaming: Increased EBITDA margin by 390bp
• Asian gaming: Flat EBITDA margins

Rule of 60 Analysis

• No company beat the Rule of 60 in Q1 2022, as most experienced a slowdown in revenue growth despite user growth.
• Match Group led in DAU growth with 48% YoY increase.
• Tencent remained flat, and Pinterest saw a 6% contraction.
• Weibo came closest to meeting the Rule of 60 with 57% growth.
• Meta, Twitter, Snapchat were close with 54%, 54%, and 52% growth, respectively.

Notable Digital Media Companies

• Discord – Invested in by GP Bullhound Fund V (Active)
• Spotify – Invested in by GP Bullhound Fund III (Realised)
• Unity – Invested in by GP Bullhound Fund IV (Active)
• Quixel – Invested in by GP Bullhound Fund IV (Realised)
• The New York Times – Acquired The Athletic for $550M
• Direct Digital – 48.0% down since IPO
• entertainment SKonec – 46.9% up since IPO

Public Comparables

Company Name	HQ	Employees	Share Price 31-03-22	EV/Revenue	EV/EBITDA	CY Revenue Growth	CY22E Margins
Meta Group	US	71,970	222.36	4.8x	10.4x	12.4%	79.2%
Tencent	CN	112,771	47.78	5.5x	17.2x	11.2%	42.5%
Naspers	ZA	28,445	113.74	10.6x	NM	29.8%	1.1%
Snapchat	US	5,661	35.99	13.9x	NM	40.8%	61.8%
Twitter	US	7,500	38.69	5.9x	43.1x	18.2%	65.2%

Conclusion

The Digital Media sector in Q1 2022 showed mixed performance, with media companies increasingly challenging Big Tech through data unification and audience scale. The gaming industry continued to experience robust M&A activity, while Web3 technologies are beginning to reshape the music industry. Investment activity remains strong, with both acquisitions and investments in emerging platforms. Despite challenges in profitability and market valuations, the sector continues to show promise with a focus on non-news content and technological innovation.