Embracer misses quarterly profit forecast on higher costs, weak box office
Feb 13 (Reuters) - Swedish games developer Embracer's (EMBRACb.ST), opens new tab third-quarter operating profit came below market expectations on Thursday, as higher user acquisition costs in mobile games and weaker-than-expected box office performance weighed on results.
WHY IT'S IMPORTANT
Embracer, like other gaming groups, benefited from growing demand for video games during COVID-19 lockdowns, but has since been hit by development delays, falling demand and poor reception for some of its new titles.
In recent years, Embracer has begun to divest some of its studios as part of restructuring efforts aimed at reducing costs and managing debt, and is charting a new course by splitting into three publicly traded entities.
The Swedish group owns more than a hundred studios worldwide and is known for popular game franchises, such as Tomb Raider, The Lord of the Rings and Kingdom Come: Deliverance.
KEY QUOTES
"The industry is still in a consolidation phase where there are layoffs driven by lack of capital and new technology tools in efficiency progress... We will make sure we are adapting to the changes in the industry and consumer demands," CEO Lars Wingefors told Reuters.
"Delays are always part of the industry, and we will give (games) more time if needed. For 'Kingdom Come: Deliverance II', for example, we delayed from releasing in November to now in February, and I think that three months gave a much more polished, bug-free experience for players", Wingefors added.
BY THE NUMBERS
The owner of the Tomb Raider franchise said its adjusted operating profit fell 11% to 1.18 billion Swedish crowns ($109.05 million) in the quarter through December, lagging analysts' forecast of 1.73 billion crowns seen in a company-provided consensus, opens new tab.
Embracer's PC/Console games segment fell 23% to 2.6 billion crowns from 3.38 billion a year ago.
Looking into the upcoming three financial years, Embracer said it has 10 AAA games under development, of which eight are from internal studios and two from external studios.
($1 = 10.8210 Swedish crowns)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
9 minutes ago
- Reuters
China says it will remove all tariffs on African exports to boost trade
NAIROBI, June 12 (Reuters) - China will negotiate and sign a new economic pact with Africa that will get rid of all tariffs on the 53 African states it has diplomatic ties with, it said, a move that could benefit middle-income nations. The Asian economic giant offers duty- and quota-free market access to least developed countries (LDCs), including many in Africa, but the new initiative will level the playing field by also offering middle-income countries similar market access. "China is ready to... welcome quality products from Africa to the Chinese market", China's foreign ministry said after a meeting of senior Chinese officials with African foreign ministers in Changsha to review implementation of commitments made during a summit in Beijing last September. In recognition of the significant disadvantages that businesses from LDCs like Tanzania or Mali could face from their more developed counterparts like South Africa once the market is fully opened, China pledged additional measures to support LDCs, including training and marketing promotion. Beijing's move could help relatively advanced countries, with significant manufacturing bases for value added products, to take advantage of the vast Chinese market, analysts said. "It enables middle-income countries like Kenya, South Africa, Nigeria, Egypt and Morocco... to be able to now enter the Chinese market duty-free," said Hannah Ryder, founder of Development Reimagined, an Africa-focused consultancy. Trade between China and Africa has been growing in recent years, but it has been heavily skewed in favour of China, which had a surplus of $62 billion last year. "Unless we have an equivalent increase of African exports to China, then trade deficits will continue to increase," Ryder said, adding that the initiative announced by Beijing could help to balance trade. During last year's summit in Beijing, China pledged 360 billion yuan ($50 billion) to African economies over three years in credit lines and investments, marking its return to big-ticket funding deals for the continent after a pandemic-related hiatus. ($1 = 7.1747 Chinese yuan renminbi)
Reuters
19 minutes ago
- Reuters
UK to invest 200 million pounds in Acorn carbon capture project in Scotland
LONDON, June 12 (Reuters) - Britain will invest 200 million pounds ($272 million) in the Acorn carbon capture and storage (CCS) project in Scotland, the government said on Thursday, fleshing out details of funding for the technology announced in a spending review on Wednesday. Britain has a climate target to reach net zero emissions by 2050 and has said CCS will be needed to curb emissions from energy-intensive industrial sectors. Acorn, being developed by Storegga, Shell UK (SHEL.L), opens new tab, Harbour Energy (HBR.L), opens new tab and North Sea Midstream Partners, in St Fergus, Scotland, will capture carbon dioxide emissions from industry and store them under the North Sea. "This vital support will enable the critical work needed to reach Final Investment Decision (FID) and marks a major step forward — not only for Acorn, but for the development of Scotland's CCS infrastructure and the growth of a UK-wide carbon capture and storage industry," Tim Stedman, CEO of Storegga, said in an emailed statement. The government said it would also back the Viking CCS project in the Humber region, in the north of England, without specifying how much it would receive. "This (funding) will support industrial renewal in Scotland and the Humber with thousands of highly-skilled jobs at good wages to build Britain's clean energy future," Britain's energy minister, Ed Miliband, said in a release from Britain's Department for Energy Security and Net Zero. Once operational, the two projects could capture up to 18 million tonnes of carbon dioxide a year, the government said. The funding is part of 9.4 billion pounds the government pledged to carbon capture technology over the spending review period and the 21.7 billion pounds it last year said would be spent on CCS over 25 years. ($1 = 0.7352 pounds)
Reuters
19 minutes ago
- Reuters
Mali hearing on Barrick's Loulo-Gounkoto gold complex adjourned to June 16
BAMAKO, June 12 (Reuters) - A Malian court adjourned until June 16 a hearing on whether to put Barrick Mining's ( opens new tab gold mining complex, suspended since January due to a dispute over taxes and ownership, under provisional administration, a presiding judge said on Thursday. The Malian government, a shareholder in the Loulo-Gounkoto gold mining complex, in May asked the Bamako Commercial Court to appoint an administrator, signaling its desire to end the ongoing standoff and reopen the complex as global gold prices soar. If reopened, the mine could bring in revenues worth at least $1 billion over the next 12 months due to record high gold prices, according to Reuters estimates. Due to the standoff, however, Mali risks repelling potential investors, while Barrick's shares have lagged those of its peers. The government and the Canadian miner have been at odds since 2023 over the implementation of a new mining code that raises taxes and gives the government a greater share in the gold mines. Barrick suspended operations at the complex in mid-January after authorities blocked its exports and seized three metric tons of its gold stock. It has since removed the Malian gold complex from its overall output forecast for 2025. Outside of court, negotiations between the two sides continue, according to people close to the talks. Mali has agreed to allow Barrick to repatriate 20% of its earnings into an international bank account, an exception that was not made for any other foreign miners who recently renegotiated contracts with the state, two people familiar with the matter said. In December, Barrick launched international arbitration proceedings over the dispute. In May, it asked the World Bank's arbitration court to halt the Bamako Commercial Court proceedings. According to two people aware of the development, the tribunal rejected that request.
