OverActive Media's second-quarter revenue falls 40% to C$5.0 million

Two arena weekends come first among the company's explanations. In the second quarter of 2025, OverActive Media hosted a League of Legends weekend at the Madrid Arena and the final weekend of the Call of Duty League season in Ontario. In the same months of 2026 it hosted neither, and the company that owns Movistar KOI and Toronto KOI reported on August 27, 2026 that its revenue for the second quarter came to 5.0 million Canadian dollars (C$), against C$8.4 million a year earlier.

The press release, issued from Toronto, sets a second number beside that one: operating costs fell 17%. The saving was smaller than the lost revenue. The net loss for the quarter was C$3.1 million, about the same as the C$3.0 million of the second quarter of 2025, and the company ended June with C$2.2 million in cash.

All amounts are in Canadian dollars. OverActive Media is listed on the TSX Venture Exchange in Toronto, on the over-the-counter market in the United States and in Frankfurt, and publishes its accounts every quarter.

The quarter in figures

The fall in revenue is about 40%: C$5.03 million against C$8.36 million by the unrounded amounts of the company's filing, as reported by Sheep Esports on August 28. Gross profit, which is revenue minus the direct cost of earning it, went from C$4.0 million to C$2.2 million. The gross margin, that profit as a share of revenue, slipped from 48% to 43%.

Adjusted EBITDA is the measure the company uses for its running performance: earnings before interest, taxes, depreciation and amortization, with some items removed by its own definition. The loss on that measure doubled because the gross profit that disappeared, C$1.8 million, was twice the C$0.9 million saved on costs. The release says so in its own terms: the lost gross profit outpaced the savings.

On the last line, the company names two opposite forces. Lower gross profit and higher finance costs, the interest on what it has borrowed, pushed the loss up; lower operating costs held it down.

Three reasons for the fall

The release gives three causes for the drop in revenue.

The first is the calendar of live events. In 2025 the second quarter included LEC on the Road in Madrid, a weekend of the League of Legends EMEA Championship played in an arena, and the Call of Duty League Championship Weekend in Kitchener, Ontario. The company's annual results gave their scale: more than 18,000 fans at the Madrid Arena and more than 11,000 in Kitchener. Neither event was held by the company in the second quarter of 2026.

The second is what the release calls a strong quarter a year earlier for Agencies, the part of the company that does marketing work for brands.

The third is the end of its place in the VCT EMEA, the European league of Riot Games' shooter Valorant. The company left that league in the fourth quarter of 2025, and the release says the exit reduced league revenue and also reduced team costs.

The geography of the accounts shows the first cause plainly. Revenue from North America fell 78%, to C$641,000 from C$2.96 million, according to the filing figures reported by Sheep Esports, which links the fall mainly to the missing Championship Weekend. Revenue from Europe fell 19%, to C$4.39 million. Europe therefore brought in about 87% of the quarter's sales.

The chart also shows that the second quarter of 2026 was the smallest of the six, level with the first quarter of 2025, and that the first quarter of 2026, which the company called a record for a first quarter, had been 7% above its equivalent.

Teams earn little of the revenue

OverActive Media splits its activity in two. Team Operations is the income that comes from fielding teams. Sheep Esports, reading the filing, lists what it holds: the shares of league revenue paid by the LEC and the Call of Duty League, payments tied to performance and prize winnings. Business Operations is everything the company sells around its brands: sponsorships, partnerships, agency work, content and live events, in the description of its first-quarter release.

In the second quarter, Team Operations revenue was C$602,000, down 48%, and Business Operations revenue was C$4.43 million, down 39%, by the figures Sheep Esports reports from the filing. The teams' own line was therefore about 12% of the quarter's revenue. Gross profit of Business Operations fell 46%, to C$1.66 million.

Under the model Riot Games set out on March 14, 2024 for its League of Legends leagues, teams receive a fixed stipend and a share of the revenue from the game's esports digital content, in place of the earlier arrangement in which they committed about US$10 million to join and received half of certain league revenues. The August release notes that the company had less of this high-margin league-share revenue in the quarter, one of the reasons the margin fell.

Where the 17% was saved

Operating costs were C$4.3 million, against C$5.2 million. The release names the sources: lower roster and team payroll after the Valorant exit, lower corporate payroll and lower team operations costs.

The filing puts numbers on each, as reported by Sheep Esports. Roster and team payroll, the salaries of players and staff, fell 31% to C$1.62 million from C$2.33 million. Corporate payroll fell 11% to C$1.51 million. Team operation costs fell 30% to C$257,000. One line went up: general and administrative costs rose 18% to C$782,000.

Adam Adamou, chief executive and co-founder, puts the weight on that side of the accounts in the release. "The cost side of the business is doing what we planned," he said. In April, presenting the 2025 results, he had summed up the year ahead as one of margin and cash.

Six months: lower sales, smaller loss

Over the first half of 2026 the picture is less sharp than in the quarter alone. Revenue was C$10.4 million against C$13.4 million, down 22%. The first quarter had grown, to C$5.4 million from C$5.0 million, before the second fell.

The gross margin for the half was about 52%, against 50%, because a larger part of what was sold early in the year came from the higher-margin commercial businesses, the company says. Operating costs were C$9.1 million against C$10.1 million, down 10%, a figure that includes the restructuring costs of an efficiency program. The adjusted EBITDA loss was C$3.4 million against C$3.3 million.

The net loss for the six months was C$5.6 million against C$6.6 million, an improvement of 16%. The improvement was made in the first quarter, when the loss narrowed to C$2.5 million from C$3.7 million.

Cash of C$2.2 million and three loans

The line that changed most since the start of the year is cash. The company held C$6.8 million at the end of 2024, C$4.4 million at the end of 2025, C$5.1 million on March 31, 2026 and C$2.2 million on June 30. The second quarter therefore used C$2.9 million of cash, in a period when the company also borrowed.

A promissory note is a written promise to repay a loan; a secured one is backed by assets of the borrower. A warrant gives its holder the right to buy shares later at a set price. The two financings of 2026 add up to about C$2.45 million. They carry interest of 12% a year and were placed with entities controlled by the chairman and another director, with Spanish shareholders and with one other lender, Sheep Esports reports from the filing. The release describes the lenders as entities controlled by certain directors and shareholders.

The filing figures reported by Sheep Esports describe the position at June 30. Current assets, what the company holds in cash or expects to turn into cash within a year, were C$7.8 million. Current liabilities, what it must pay within a year, were C$11.47 million. The gap, a working-capital deficit of C$3.68 million, is more than C$2.2 million wider than six months earlier. Contractual payments due within twelve months come to C$8 million, of which C$7.19 million is owed to suppliers and in accrued liabilities; cash on hand covers less than a third of that. Total assets exceed C$60 million, about 80% of it goodwill and intangible assets, accounting values that cannot be spent.

The company states in its filing that it cannot guarantee it has sufficient funds to operate for the next twelve months, according to Sheep Esports. The release lists the ability to raise financing and to continue as a going concern, the accounting term for a business expected to keep operating, first among its risks.

The second half

Management gives two priorities for the rest of 2026: closing its financing plan and converting its pipeline of partnerships into signed business. The company expects revenue, gross profit and adjusted EBITDA to improve in the second half, Sheep Esports reports, and points to three sources: the Esports World Cup, the Madrid Roadtrip and the Bell Esports Challenge.

The first is already played. At the Esports World Cup, Movistar KOI finished between 13th and 16th in League of Legends, and the Toronto roster, competing under the Movistar KOI name, finished between fifth and eighth in Call of Duty, the release says. Sheep Esports counts US$120,000 of gross prize money for the company's teams across three games at the event: Teamfight Tactics, Call of Duty and League of Legends.

The Bell Esports Challenge, hosted by Toronto KOI at the Metro Convention Centre in Toronto, opened on the day of the release and runs until August 30. Toronto KOI finished third at the third Major of the Call of Duty League season and in the top six at the fourth, and the team has an agreement with Video Game Live Expo for a weekend event in October 2026.

The Madrid Roadtrip, an LEC weekend hosted by Movistar KOI at the Madrid Arena, is set for September 4 to 6 on Riot Games' calendar; the spring edition drew about 12,000 people. Sheep Esports reports that Movistar KOI will not play in their own home weekend after their results in the summer regular season, while they can still reach the summer playoffs.

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