Embracer Group Q3 numbers: 30% Drop

Embracer Group just released their Q3 numbers per their earnings call yesterday and the company is seeing a 30% drop on the Swedish Stock exchange.

Key highlights from the earnings call:

• Net Sales: The company reported net sales of SEK 7.4 billion for the quarter, reflecting a 7% organic growth.

• Adjusted EBIT: Adjusted EBIT amounted to SEK 1,175 million, slightly below the previous year’s SEK 1,318 million but above management expectations.

• Sale of Easybrain: Embracer Group announced the sale of Easybrain to Miniclip for $1.2 billion (USD), with the transaction expected to close any time now.

• Strategic Focus: The sale of Easybrain aligns with Embracer’s strategy to streamline operations and focus on core assets. However, they saw just a 2% increase on mobile and a 23% drop on PCC revenues so I am not sure how this will effect them long term (money in bank from the sale is king I guess!)

• Restructuring Progress: The company reported SEK 1.2 billion in free cash flow during the quarter, indicating progress in its restructuring efforts.

All in all, there is definitely still a large amount of financial pressure which obviously brought the EasyBrain sale around despite exceeding management expectations.

So yeah, they’re not out the woods yet!