Digital Domain Reports 2022 Results: Turns to Positive EBITDA of Media Entertainment Business Segment Driven by Record Revenue in 30 Years of the Business and Laser Focus on Core VFX business
HONG KONG, March 31, 2023 /PRNewswire/ -- Digital Domain Holdings Limited ("Digital Domain" or the "Group"), Hong Kong listed visual effects ("VFX") and virtual human technology company, reports full year results for 2022 that reflect the Group's largely completed reorganization plan aimed to refocus its business on providing the highest quality VFX services to the world's leading content producers (mostly Hollywood studios and global game publishers).
In 2022, the Group has recorded a revenue of HK$959 million (US$123 million), compared to HK$864 million (US$111 million) or 11% increase from the same period in 2021 – this is the all-time highest revenue in the 30 years of the Group's operations.
Following Digital Domain's refined focus on VFX services, closure of loss-making activities, combined with achieving over HK$780 million (US$100 million) in sustainable revenue scale of the business and significant investment in high-quality or lower-cost production hubs in Canada and India, the Group has transformed itself into a firmly profitable operation with a gross margin of 23% in 2022 compared to 14% in 2021 and 11% in 2020. This systemic change in the profitability of Digital Domain led to the Group reporting positive EBITDA of Media Entertainment Business Segment for first the time since 2014; in 2022, Digital Domain generated positive HK$6.15 million (US$0.8 million) EBITDA of Media Entertainment Business Segment versus the negative HK$304.7 million (US$39.2 million) in 2021. On the net basis Digital Domain reporting HK$215 million (US$28 million) net loss in 2022 (a reduction by 72% compared to 2021 net loss of HK$781 million (US$100 million) – those losses largely explained by impairments and write-offs of multiple non-core legacy activities accumulated by Digital Domain over the years before the Group's focus shifted to building profitable and scalable VFX operations in 2021.
"Our 2022 results evidence successful completion of the Group's reorganization aimed to build scale and profitability in our core VFX business," commented Daniel Seah, CEO of Digital Domain. "We intend to preserve focus on profitability and positive operating cash flows and we'll look for further profitable growth opportunities both in our core VFX business and in the commercial exploitation of our highly relevant technologies for artificial intelligence" added Mr. Seah.
About Digital Domain
Digital Domain Holdings Limited ("Digital Domain") is the pioneer of creating transportive experiences. Throughout the last 30 years, Digital Domain has grown to lead the visual effects industry, expanding the arm of virtual humans and visualization globally. Digital Domain's rich legacy consists of hundreds of feature films and episodes, thousands of advertising, game cinematics, and immersive experimental experiences. A creative force in cutting-edge technologies, Digital Domain, has brought exceptional artistry to Academy Award-winning blockbusters of Titanic, What Dreams May Come, and The Curious Case of Benjamin Button, Marvel Cinematic Universe titles crushed all time worldwide box office, such as the Avengers franchise, and Stranger Things made a splash with Season IV.
As the first independent visual effects studio to successfully enter Greater China, Digital Domain has further paved the way towards virtual race since 2016. Leaning into technologies of artificial intelligence and virtual reality allows Digital Domain to create photorealistic and emotionally expressive virtual humans, all in real-time, -and provides an advanced medium for human-computer and human-human interactions in diverse virtual scenarios.
Digital Domain Holdings Limited is listed on the Hong Kong Stock Exchange (Stock code: 547). Digital Domain has ten locations, including Los Angeles, Vancouver, Montreal, Beijing, Shanghai, and Hyderabad.
Digital Domain Official Website - WWW.DIGITALDOMAIN.COM
SOURCE Digital Domain Holdings Ltd.
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