Pixel boomed during covid and the overall market it plays in has been declini.g the last couple of years. They show on one of the slides that Pixel has outperformed the broader industry. Reducing investment is probably a function of trying to maintain profits in a subdued environment. They mentioined reducing other costs in Pixel.
The focus on "quality" DAU is obviously about improving margins by cultivating longer term players, players that create sunk costs for themselves and play titles for years. I dont know if reducing overall player numbers will hurt them, but I take the point about the funnel into the games reducing.
Having said all that, Pixel is a lower quality segment mainly because 30% of revenue on the app stores is paid in commissions, it also has lower barriers to entry. Only the social slots segment within Pixel has a moat in my opinion, outside of that its just scale which others in the industry also have.
The company is pivoting into iGaming as the next big growth avenue, as well as nurturing the powerhouse land based business. Digital helped a lot during covid shut downs in 2020, but it clearly needs a bit of a shake up. They spent a lot of money on Palarium and BigFish...
Your comment about governments requiring revenue could actually help the gaming industry in the US, but I also take your point adverse regulation is always a threat.
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