Second quarter 2024

• Net sales amounted to SEK 40.2 million (43.2).
  PAYDAY 2 accounted for SEK 9.2 million (42.7).
  PAYDAY 3 accounted for SEK 22.0 million (0).
  Third-party publishing accounted for SEK 8.8 million (0).
• EBITDA* amounted to SEK 8.1 million (14.1), including items affecting comparability of SEK -3.5 million.
• Cash flow from operating activities amounted to SEK 2.7 million (20.1).
• Depreciation, amortization and impairment amounted to SEK 78.9 million (17.0).
• Profit/loss before taxes amounted to SEK -70.6 million (24.1).
• Basic and diluted earnings per share amounted to SEK -0.05 (0.03).

January-June 2024

• Net sales amounted to SEK 96.8 million (69.9).
  PAYDAY 2 accounted for SEK 20.1 million (69.1).
  PAYDAY 3 accounted for SEK 45.3 million (0).
  Third-party publishing accounted for SEK 26.2 million (0).
• EBITDA* amounted to SEK 56.6 million (18.1), including items affecting comparability of SEK 16.3 million.
• Cash flow from operating activities amounted to SEK 81.1 million (40.8).
• Depreciation, amortization and impairment amounted to SEK 150.7 million (32.7).
• Profit/loss before taxes amounted to SEK -91.5 million (-0.6).
• Basic and diluted earnings per share amounted to SEK -0.06 (-0.00).
• Cash and cash equivalents amounted to SEK 334.6 million (498.8).

Significant events during the quarter

• April 15, a content update was released for Roboquest with new content, new functionality, and improvements.
• May 2, third “Operation Medic Bag” patch was released for PAYDAY 3
• May 15, Starbreeze CFO Mats Juhl was appointed acting CEO
• May 15, Starbreeze's Annual General Meeting 2024 was held.
• May 23, version 1.0 of The Tribe Must Survive was released.
• May 30, fourth “Operation Medic Bag” patch was released for PAYDAY 3.
• June 6, a content update was released for Roboquest – “Super Update” – with new content, new functionality, and improvements.
• June 7, Starbreeze announced changes in Group management.
• June 13, “Explorer Update” was released for The Tribe Must Survive with new content, new functionality, and improvements.
• June 28, release of PAYDAY™ 3: “Chapter II: Boys in Blue”, a new DLC with a new heist, content, functionality, and improvements.

CEO’s Message
Continued focus – quarter in line with expectations
Starbreeze's main focus is PAYDAY 3 and continuing to develop and expand the game to grow the player base and increase our sales as a result. We are seeing major improvements in both player sentiment and engagement based on the updates that have already been made, and the new content we have released has been well received. We will continue on the same path during the fall. In addition to PAYDAY 3, our Dungeons & Dragons® game is now in full production, a fantastic project that is growing as planned. I look forward to telling you more about this game later in the year.  Game development has relatively long cycles making it important to be able to look ahead and plan for projects to be carried out both in parallel and after titles that have already been announced. Our strategy is still to become a true multi-title studio with a favorable risk profile.  In order to achieve our goal, there are several prongs to our strategy: developing and refining our proprietary brands, licensing strong brands from which to develop games and, finally, taking on projects that enable us to optimize the use of our own resources and benefit from the broad competence we have within the company.

RESULTS AND FINANCIAL POSITION
Starbreeze continues to be financially strong, with a healthy balance sheet light on debt and cash holdings to execute our strategy. Sales and earnings were in line with the first quarter of the year, and as previously communicated, we expect sales to increase in the third quarter of the year, as we increase the frequency of content updates for PAYDAY 3.

PAYDAY 3
At the end of the quarter, we successfully released our second DLC - “Chapter II: Boys in Blue”. As well as a new heist, the update also included new weapons, cosmetics and updates under the “Operation Medic Bag” initiative. Each new release has a directly noticeable effect on player activity and at the end of the quarter, PAYDAY 3 had around 300,000 monthly active users (MAU). We are moving in the right direction and will continue to work hard to increase activity, broaden the player base and in the process also increase sales. In addition to two more major DLCs during the fall, we will also be releasing a free heist to all players in August. We have released five major updates under the “Operation Medic Bag” initiative so far this year and we have a long-term plan for more updates in future months and years. Coming soon are a number of major content updates and functional improvements which are planned for release in August, September, and October. Our PAYDAY team has also started on plans and project launch for the content we are planning to release during PAYDAY 3’s second year on the market.

PROJECT BAXTER – DUNGEONS & DRAGONS®
Production of Baxter continues at full speed, while we prepare to create the best possible commercial conditions for the game once it is released in 2026. Starbreeze will publish the game, but our ambition is to enter into partnerships where this is beneficial for the game and Starbreeze. These partnerships could be for marketing, physical distribution or other purposes that increase both the quality and potential of the project, whilst balancing the risk for Starbreeze.

THIRD-PARTY PUBLISHING
Roboquest continues to perform strongly, to the delight of both Starbreeze and our partners at RyseUp Studios. Two content updates were released during the quarter and another one after the end of the period. It is in line with our overall strategy that games published by Starbreeze should increase the players’ perceived value of our titles over time.
The full 1.0 version of The Tribe Must Survive was released during the quarter and also received its first major content update that included a new game mode as well as more content for players who want an additional level of challenge.
 
ORGANIZATION
We continue to hire specific skills, particularly for positions on Project Baxter, while keeping the organization efficient and fit for purpose to manage all our ongoing projects. We work constantly on the company’s competence structure to ensure that we have the right people and skills in all positions. At the end of the quarter, the number of employees was 192; the majority of these are employed at our head office in Stockholm.

CLOSING WORDS
We continue to deliver at a high pace according to our plan, both long-term as per our strategy and short-term as per the plans for our games. In regards to PAYDAY 3, we are looking forward to revealing the result of everyone’s hard work with the release of new DLCs during both August and September. In addition, we have a number of major updates planned under “Operation Medic Bag”, which we are convinced will fulfill our players’ hopes and expectations. Project Baxter will enter a phase in the fall where we will be more proactive in searching for and holding discussions with suitable partners. All with a view to creating the most favorable commercial conditions for the project.

With a solid financial position, strong cash position and strong projects both under development and on the market, we have the best possible conditions to make Starbreeze an even better company in the long term through successful releases.
 
MATS JUHL, acting CEO

Presentation
The company will hold a webcast at 10 AM, August 20, 2024. To join the presentation–click here