Embracer Reports 128% Sales Increase in Q3, Despite Organic Growth Decline

Embracer Group has released its Q3 FY 22/23 financial report, covering the period ended December 31, 2022. The company saw net sales reach SEK 11.6 billion ($1.1 billion), representing a 128% year-over-year increase, although organic growth decreased by 3%. PC and console sales contributed SEK 3.57 billion ($339 million), up 64% year-over-year, while mobile sales added SEK 1.57 billion ($149 million), with a 2% year-over-year increase. Net profit stood at SEK 1.49 billion ($141 million). According to CEO Lars Wingefors, the quarter was 'stable' and 'in line with management expectations.' However, the decline in organic growth was attributed to fewer new releases on PC and console, as well as 'tough year-on-year comparisons.' Wingefors noted that consumers are spending less, particularly when compared to the pandemic years of 2020 and 2021. Goat Simulator 3 was identified as a primary sales driver for the quarter among Embracer's new releases. The company expects to secure more third-party funding and close additional deals by the end of the financial year. Embracer has appointed Careen Yapp as chief strategic partnerships officer to bolster its 'partnership approach.' The firm invested SEK 1.69 billion ($160 million) in game development during the quarter, reflecting a shift towards internal development projects. The number of game developers at Embracer has grown to 11,152, and the company is working on 224 projects, including 31 AAA titles. Embracer anticipates its EBIT to be between SEK 8 billion ($760 million) and SEK 10 billion ($950 million) for the full financial year.