Embracer’s Q1 shows year-on-year revenue drops across mobile, PC, console and more

• The company’s restructure strategy is saving the day alongside revenue drops in every division
• CEO Lars Wingefors remains optimistic about the company’s immediate prospects however

Stay Informed

Embracer’s interim Q1 2024 report shows a company out of freefall and making some smart moves to recovery following an ongoing rough ride. But it’s clear that the road to pure profit is still some distance ahead.

In the first quarter of 2024 net sales decreased to SEK 7,933 million from 10,450 million in the same period last year – a drop of 24%. And drops were reported across the full board of the company’s four reporting divisions with all delivering minus figures when compared year-on-year.

A significant portion of the total drop is accounted for by a decrease in PC and console game contributions. This sector decreased by 34% to SEK 2,656 million, down from 3,996 million. However, even this is eclipsed by the drop in the company’s Entertainment & Services division, being down 54% to SEK 848 million from 1,832 in the same period last year.

Mobile and tabletop save the day

There was slightly better news for the company’s mobile and tabletop games with mobile down just 3% to SEK 1,389 million (from 1,438 million) and tabletop dames down 5% to SEK 3,039 million (from 3,184 million last year).

They’re a difficult set of numbers to spin but Embracer’s official release does just that, citing an expectation and preparation for PC and console drops, significantly improved cash flow and lowered net debt as reasons to be cheerful.

Lars Wingefors, Embracer CEO said, “We started FY 2024/25 in line with management expectations, growing profitability YoY in both the Mobile and Tabletop segments. As expected, the performance in PC/Console and Entertainment & Services was softer YoY due to a lower release activity.

The transformation continues

“The transformation of our PC/Console business continues, and the pipeline of games looks solid. We still expect to release completed games with a value of SEK 3.9 billion for the financial year. Our highly anticipated game Kingdom Come: Deliverance II [on PC and console] is now confirmed for global release on February 11, 2025.

“The process to separate into three standalone publicly listed entities is progressing according to plan. Asmodee will host a capital markets day during the third quarter of the current financial year ahead of its spin-off.”

Wingefors described the net sales drop as “in line with management expectations” being “primarily due to tough comparisons and few new product releases within PC/Console Games and Entertainment & Services.”

“We are confident in our pipeline for the financial year, and still expect the value of completed game development for the year to be around SEK 3.9 billion,” Wingefors continues. “In Q2, we expect a solid Adjusted EBIT growth YoY for Tabletop Games and broadly stable development for Mobile Games.” 

You can get a full version of their latest report here.