Thank you for standing by, and welcome to Snail Inc.'s Second Quarter 2025 Earnings Conference Call and Webcast. I would now like to turn the call over to Steven Shinmachi with Investor Relations.

Thank you, and good afternoon, everyone. Welcome to Snail Inc.'s Second Quarter 2025 Earnings Conference Call and Webcast. Joining us for today's call are Snail Inc.'s Co-CEO, Tony Tian; Senior Vice President, Director of Business Development and Operations, Peter Kang; and Chief Financial Officer, Heidy Chow. The company's second quarter 2025 earnings press release was filed earlier today and is available on the Investor Relations section of Snail Inc.'s website at www.snail.com or the SEC's website at www.sec.gov/edgar. During this call, management may make forward-looking statements regarding future events and the future financial performance of the company. Actual events or results may differ materially from our expectations and forward-looking statements are subject to certain risks and uncertainties. Please refer to the company's Form 10-Q that has been filed with the SEC, the most recent Form 10-K that was filed with the SEC on March 26, 2025, and other SEC filings. The company makes these forward-looking statements as of today and disclaims any duty or obligation to update them or to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any statement is based. Additionally, on today's call, we refer to bookings and EBITDA, which are non-GAAP financial measures and provide useful information for the company's investors. You will find a historical reconciliation of bookings and EBITDA to the corresponding GAAP measures in the earnings press release and the company's SEC filings. And now I will turn the call over to Tony Tian, Co-Chief Executive Officer of Snail. Sir, please proceed.

Thank you, and good afternoon, everyone. Thank you for joining us today to review our financial and operating results for the second quarter ended June 30, 2025. The second quarter was a transformative quarter for Snail, highlighted by the official announcement of our proprietary stablecoin project. We believe this project positions Snail as one of the pioneers within the gaming industry to embrace and adopt such initiatives. Heidy will provide a detailed overview of the strategic rationale behind our entering into stablecoins later in the call. But at a high level, the decision reflects strong alignment with our business model and external opportunities. As a gaming company, we see clear synergies and compelling use cases that make this move not just innovative, but also one with substantial long-term ROI potential. Snail's vision remains rooted in delivering innovative products and content to the evolving gaming landscape. Our pursuit of launching our proprietary stablecoin reflects that vision and offers a path to generate meaningful value for our business and shareholders. We have been intentional in selecting and retaining the right partners to establish a strong foundation for success and have initiated our capital formation strategy through the recent ATM offering filed with the SEC, marking the first step in our broad capital raising efforts tied directly to this stablecoin project. We remain committed to transparency, and we'll continue to share regular updates as the project progresses. We are confident in the transformative impact this stablecoin initiative will have once fully launched. Turning to our second quarter results. We saw a modest year-over-year increase in revenues, but more notably, meaningful growth in both bookings and units sold. Bookings rose by 18.5% to 27.1 million and units sold increased by 58.4% to 2.1 million for the quarter. This growth was largely driven by strong performance in June, supported by our annual publisher sale and the successful launch of new content, celebrating the 10-year anniversary of ARK. The publisher sale event featured steep discounts across several of our most popular titles, driving a surge of new players across ARK and other games in our portfolio. A key highlight was ASE, which was discounted for the first time since 2023, resulting in significant uplift in its user base during the promotional period. Additionally, the ARK 10-year anniversary celebration brought substantial new content updates to ASA further fueling engagement and growth. We also launched the presale for ARK: Lost Colony in June, which contributed significantly to our bookings. Presale performance slightly exceeded our internal projections and was the primary driver of the growth in bookings during Q2. Beyond the ARK franchise, we continue expanding our Indie publishing portfolio and the Wandering Wizard label. In the quarter, we released several new Indie titles and strategically acquired publishing rights to additional promising projects. Peter will share more detailed insights into a gaming portfolio and roadmap here shortly. A quick note on our subsidiary, Interactive Films and other short films business. We are continuing to progress on our MOU we announced a few months ago on the joint development, production and global distribution of at least 10 short dramas. Both sides are collaboratively working across the development phase and look forward to releasing these short-film dramas together over the next couple of months. We also announced just last week that Interactive Films will be developing and publishing a new dating simulation title called The Fame Game: Welcome to Hollywood. This marks the first for Snail within this genre, and the project benefits from the streamlined mechanics that allow for cost-effective development and rapid iteration, we are also preserving the game's emotional depth. The barrier to entry for the game is low, making it accessible to casual players and for those who have an interest in narrative-focused games. We expect a quick turnaround from development to launch and look forward to officially releasing this game later this year. Looking ahead to the future strategy of Snail, we will aim to execute a dual strategy where we not only continue to drive growth in our core gaming business, but also steadily advance our stablecoin roadmap. Our gaming operations remain the cornerstone of our near-term focus and the foundation of our company. At the same time, the stablecoin initiative represents a long-term strategic opportunity with clear synergies across our portfolio. While external use cases of the stablecoin will remain fluid over time, we see the potential of these two pillars to become increasingly interconnected, enabling us to deliver new user experiences, innovative solutions and unlock long-term value, something only a few of our competitors have been able to activate. Our team remains highly optimistic about Snail's future across both gaming and stablecoin initiatives. We are committed to executing on our vision and delivering sustained, meaningful results for our shareholders. I will now hand it over to Peter to dive deeper into our gaming operations. Peter.

Thanks, Tony, and good afternoon, everyone. The second quarter proved to be a strong engagement driver across many of our titles, building on the momentum we highlighted in our previous earnings call. During this past quarter, average DAU for ARK: Survival Evolved and ARK: Survival Ascended reached approximately 157,000 and 85,000, respectively. As of quarter end, ARK has been played for a cumulative 4.1 billion hours with the average screen time for users reaching 161 hours. Our mobile game also continues to grow due to delivering consistent new content, with the mobile title surpassing 6.9 million downloads across iOS and Android and average DAU of approximately 104,000 during the quarter. These encouraging engagement results are a direct reflection of our deliberate efforts through Q2, including the rollout of new content updates, strategic releases and our publisher sale event that kept our communities consistently engaged and drove in new players. Starting in April, we kicked off the quarter with the seasonal excellent adventure event for ARK: Survival Ascended and launched the Extinction map on ARK Mobile. April also marked the one-year early access anniversary of Bellwright, where we introduced substantial new content and player-requested features to support the franchise's long-term growth. On the Indie front, we launched two new titles, The Cecil: The Journey Begins and Chasmal Fear in April, and three more new titles to close out the quarter, Castle of Secrets, Robots at Midnight and Zombie Rollerz: The Last Ship. Building on this momentum, May was highlighted by ARK: Survival Ascended's participation in the PlayStation Plus subscription program, PS Plus. During the month, ARK: Survival Ascended was downloaded over 8 million times via PlayStation Plus signaling strong and growing engagement from our console player base. June emerged as the most impactful month of the quarter, marked by the 10-year anniversary of the ARK franchise and our annual Steam publisher sale event. The 10-year anniversary of ARK marked an important moment for both our team and our global community of players. As discussed last quarter, ARK's continued ability to attract a global audience across multiple platforms speaks to the franchise's enduring relevance and our commitment to serving the loyal player base that has supported us over the past decade. We're proud of the enduring position ARK holds in today's Sandbox survival market and remain focused on delivering consistent content updates and new DLCs that drive engagement and support long-term growth. To celebrate the anniversary, we rolled out several key updates across ARK, including the first major update to Astraeos' DLC on ARK: Survival Ascended, the launch of ARK Ragnarok on ARK: Survival Ascended, and the release of Genesis: Part 1 on ARK Mobile. These activations led to a sharp rise in player engagement. ARK: Survival Ascended achieved its highest peak concurrent users and daily active users on Steam in 2025, while ARK Mobile saw a 27.4% increase in first-time downloads and a 17.8% increase in daily active users during the launch week of Genesis: Part 1 compared to the previous week. Complementing the anniversary momentum, we also held our annual Steam Publisher sale event in June, which served as a critical driver for both player acquisition and engagement across our portfolio. Starting with ARK. ARK: Survival Ascended, ARK: Survival Evolved, PixARK and ARK Park were all discounted during this event. This was also the first time since 2023 that ARK: Survival Evolved was on discount. ARK: Survival Evolved saw a strong resurgence in both sales and engagement. Total units sold increased by 3.8x and average daily sales rose over 3,000% compared to the prior month in 2025. Peak concurrent players reached approximately 66,000 demonstrating the franchise's continued global resonance even a decade after launch. Other games in our portfolio also saw a significant uplift with deep discounts and new content updates supporting titles like Bellwright, West Hunt, The Cecil, Chasmal Fear and Survivor Mercs. These promotions reinforce our ongoing strategy to increase the visibility, traction and engagement of our smaller scale Indie games. Our publisher sale event remains a cornerstone of our annual engagement and monetization strategy. This year's event drove daily unit sales 10.8x the average non-promotional periods in 2025. With the steepest discounts to date on key titles and the expanded portfolio featuring recent launches and updates, these sale events are powerful discovery engines bringing in new players, reinvigorating our back catalog and helping build long-term engagement and monetization across both established and emerging titles. In regards to Aquatica, our team is working diligently to address the issues that came with the launch. We've made a pre-Aquatica branch available on Steam, so players can roll back to the version of ARK: Survival Evolved prior to the DLC launch. We'll continue sharing updates on the Steam forums as we work toward a full resolution. Looking ahead to the content roadmap for the remainder of the year. We have a strong slate of updates and releases designed to sustain player engagement and expand our portfolio. For the ARK franchise, we will continue rolling out seasonal events, community-driven mods and regular content updates to ensure a steady stream of fresh experiences for our players. A major focus will be on the preparation and launch of ARK: Lost Colony, the first map built exclusively for ARK: Survival Ascended and a storyline that bridges ARK Extinction, ARK Genesis and ARK 2. Following the preorder sales launch in June, we've seen encouraging early results. Sales tracked slightly ahead of our internal projections during the first month, contributing meaningfully to our Q2 bookings growth. During the publisher sale event, the Lost Colony expansion pass was the #1 preorder on PlayStation as well. Beyond ARK, we are also preparing to launch several new titles across different genres and platforms, including Honeycomb, Echoes of Elysium, Rebel Engine and The Fame Game: Welcome to Hollywood, a new relationship sim game to be developed in-house under Interactive Films. Together, these initiatives underscore our commitment to delivering high-quality content, nurturing our core franchises and building the next generation of titles that will shape Snail's long-term success. With that, I will now turn the call over to Heidy to discuss our financial results and the direction of our stablecoin initiative. Heidy?

Thank you, Peter, and hello, everyone. Thank you for joining us today. I'm pleased to share the details of our financial results for the second quarter ended June 30, 2025. Net revenue for the second quarter increased to $22.2 million compared to $21.6 million in the same period last year. The increase was primarily due to an increase in total ARK sales of $3.3 million, $3 million recognized for the inclusion of ARK: Survival Ascended in the platform subscription program in 2025, an increase in sales of the ARK Mobile of $600,000 that was driven by the release of ARK: Ultimate Mobile Edition and an increase in revenues related to other games of $400,000 due to the release of various games. These increases were partially offset by the increase in deferred revenue of $3.7 million and a decrease in revenue related to Bellwright of $3 million in the three months ended June 30, 2025, compared to the same period last year. Net revenues for the six months ended June 30, 2025, increased by 18.4% to $42.3 million compared to $35.7 million in the same period last year. The increase was primarily due to an increase in total ARK sales of $6.1 million, $3 million in revenues for the inclusion of ARK: Survival Ascended in a platform subscription program and an increase in sales of the ARK Mobile of $1.9 million that was driven by the release of ARK: Ultimate Mobile Edition. These increases were partially offset by the decrease in revenue specific to Bellwright of $2.2 million, a nonrecurring Angela Game settlement of $1.2 million occurring in 2024, the related decrease in Angela Games revenue of $700,000 and the increase in deferred revenue of $300,000 during the six months ended June 30, 2025, compared to the same period last year. Net loss for the three months ended June 30, 2025, was negative $16.6 million compared to net income of $2.3 million in the same period last year, primarily due to increases in the cost of revenues and operating expenses, a result of the company's increased headcount, research and development and marketing expenses, and the recognition of a valuation allowance against the company's deferred tax assets of $12.9 million during the quarter ended June 30, 2025. Net loss for the six months ended June 30, 2025 was negative $18.5 million compared to $500,000 in the same period last year primarily due to increases in the cost of revenues and operating expenses, a result of the company's increased headcount, research and development and marketing expenses and an increase in income tax provision of $12.3 million, as a result of the valuation allowance recognized against the company's deferred tax assets during the six months ended June 30, 2025. Bookings for the second quarter increased 18.5% to $27.1 million compared to $22.9 million from the same period last year. The increase was primarily driven by various sale promotions in 2025 that did not occur in 2024, specifically around ARK: Survival Evolved and the release of ARK: Lost Colony to presale in 2025. Bookings for the six months ended June 30, 2025, increased 16.3% to $49.4 million compared to $42.4 million in the same period last year. The increase was primarily driven by the release of ARK: Survival Ascended DLC Astraeos in the first quarter of 2025, sales promotions that were the first of their kind of ARK: Survival Evolved in 2025, and the release of ARK: Lost Colony to presale in 2025. EBITDA for the second quarter was negative $2.4 million compared to $3.1 million in the same period last year. The decrease was primarily due to an increase in net loss of $18.9 million partially offset by an increase in the provision of income taxes of $13.3 million and a decrease in interest income and interest income related parties of $100,000. EBITDA for the six months ended June 30, 2025, was negative $5.8 million compared to $1.2 million in the same period last year. The decrease was primarily due to an increase in net loss of $19 million; a decrease in interest expenses of $300,000 was partially offset by an increase in the provision for income taxes of $12.3 million. As of June 30, 2025, unrestricted cash and cash equivalents was $7.9 million. To review our detailed financial statements, please refer to the earnings press release and also the Form 10-Q filed with the SEC. Now on to our stablecoin project. The adoption of a crypto treasury strategy was accelerated significantly, especially over the past year. On brand with the ethos of our organization, innovation has been at the heart of our approach and the growing market validation of these treasury models for us to thoroughly explore how we can potentially adopt and incorporate a similar framework. After several months of internal analysis and discussion, we identified a unique opportunity to chart our own path, one that centers on the development and issuance of a proprietary U.S. dollar-backed stablecoin rather than simply following prevailing models. We saw the potential to design a solution tailored specifically to our business ecosystem. We believe this initiative represents a natural evolution of our innovation strategy, offering the potential to address current market gaps in digital payments and financial infrastructures by delivering a secure, regulated and scalable solution. Our decision to pursue this stablecoin project was both deliberate and timely, aligning closely with the strong regulatory momentum generated by the passage of the GENIUS Act. This legislation established a regulatory framework for U.S. dollar-backed stablecoins, offering clarity and consistency in how such assets are governed. We believe this Act is a tailwind across the digital asset space and reinforces the strategic relevance of our stablecoin initiatives. To that end, we have taken several foundational steps to accelerate the launch of this project. A top priority has been identifying and engaging the right strategic partners and advisers to ensure long-term success. We are pleased to have retained Dr. George Cao, Founder and CEO of AscendEX, a full-stack cryptocurrency financial platform as an external consultant. Dr. Cao brings deep industry expertise and will play a crucial role in helping us implement the core infrastructure of our stablecoin. In parallel, we have engaged an experienced legal adviser including a nationally recognized law firm run by Chambers FinTech Legal USA as a leading adviser to cryptocurrency and blockchain clients. Their support will be essential in building a robust and fully compliant legal and regulatory framework. Additionally, we have formed Snail Coins LLC, a wholly owned subsidiary of Snail, which will serve as the dedicated entity responsible for the issuance, management and operational oversight of our stablecoins. This structure also provides flexibility to explore broader opportunities in digital asset management as the ecosystem evolves. And more recently, we have initiated our capital formation strategy through our At The Market Offering to begin building the necessary reserves backing needed for our stablecoin. Looking ahead, we intend to stay transparent and maintain an open dialogue with our shareholders to ensure the public remains up to date on any material developments and key milestones achieved as the project progresses. At this stage, the project remains full of ongoing internal discussions around the regulatory framework, infrastructure and additional potential use cases that could enhance the coin's value and utility. In parallel, we are actively engaging with potential partners, consultants and advisers to support key aspects of the project. At the same time, we are assessing future hiring needs for experts in blockchain, stablecoin and digital asset strategy to determine which capabilities should be built in-house and which will benefit from external expertise. As Tony mentioned at the onset of the call, Snail is now pursuing a dual-pronged growth strategy. This involves both the continued execution of our core gaming business, including the ongoing growth of the ARK franchise and the expansion of our Indie game portfolio, as well as a long-term approach to our stablecoin initiatives. Our team remains excited about the future of Snail, and we look forward to the continued execution on all fronts to maximize shareholder value. Thank you all for joining us today.

At this time, this concludes Snail Inc.'s Second Quarter 2025 Conference Call. If your question was not taken, please contact Snail Inc.'s IR team at [email protected]. Thank you for your participation, and you may now disconnect.