Strategic Transition and Performance Drivers

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• Management is transitioning Snail from a single-IP company focused on ARK into a fully integrated developer and publisher supporting multiple global franchises.

• Revenue growth of 35.7% was primarily driven by ARK: Survival Ascended (ASA) and the successful launch of the Lost Colony DLC, alongside strong performance from Bellwright.

• The company has entered the final development phase for three AAA titles—For the Stars, Nine Yin Sutra: Immortal, and Nine Yin Sutra: Wushu—which are intended to compete in the same tier as ARK.

• Strategic diversification includes a 'two-product strategy' for the Nine Yin Sutra IP to capture both legacy MMORPG fans and the rapidly growing cultivation subgenre in the Chinese market.

• Operational efficiency was bolstered by amending software license agreements for ASA, which is expected to reduce annual licensing fees by $6 million.

• Management intends to reinvest the $6 million in annual licensing savings directly into the development of the upcoming AAA pipeline to accelerate the company's inflection point.

Pipeline Roadmap and Revenue Evolution

• Management anticipates a shift in revenue mix over the next few years as the company moves away from ARK-dependency toward a multi-franchise model.

• The ARK roadmap is secured through 2027, with the upcoming ASA Genesis Part 1 release expected to trigger the recognition of approximately $11 million in deferred revenue.

• For the Stars is being developed with a phased approach, starting as a co-op experience before evolving into a long-term MMO-style ecosystem.

• The company plans to leverage major industry events like Gamescom, Bilibili World, and ChinaJoy later in 2026 to unveil critical updates for the AAA pipeline.

• Guidance assumes continued stability in the core ARK franchise while scaling the indie portfolio and preparing for the launch of the new flagship titles.

New Business Ventures and Risk Factors

• The SaltyTV short-form video business has expanded its content library by 5.7x, growing from 49 to 279 IPs through licensing and internal development.

• Management is integrating vertical dramas with interactive games, targeting 1 million units in sales for two interactive titles scheduled for Q3 2026 release.

• The USDO stablecoin project is moving from building to launch readiness, with money transmitter license applications currently progressing across multiple states.

• A proprietary gaming digital goods platform, Noise Digital Warehouse, will serve as the primary go-to-market channel for the USDO integration.