Q2 2026: Half Year report Beyond Frames Entertainment AB (publ)

Second Quarter, April 1 - June 30, 2026

• Sales amounted to 20,426 (34,204) kSEK.
• Operating profit before depreciation and amortization and shares in associated companies' earnings (EBITDA) amounted to -2,404 (6,021) kSEK.
• Profit after financial items amounted to -9,137 (-2,923) kSEK, impacted by depreciation of capitalized development costs, which starts already during development.
• EBITDA per share amounted to -0.13 (0.32) SEK.
• Profit per share after financial items amounted to -0.49 (-0.16) SEK
• Cash and cash equivalents at the end of the quarter amounted to 9,621 (8,608) kSEK. Cash and cash equivalents amounted to 11,259 kSEK at the end of the previous quarter.
• After the quarter, new project funding of USD 1.9 million was secured from an undisclosed partner for a new title currently scheduled for release in 2028. This proves our capability to leverage our experience, capabilities, and strategic relationships developed in recent years.

First half year, Jan 1 - June 30, 2026 

• Sales amounted to 42,562 (73,336) kSEK.
• Operating profit before depreciation and amortization and shares in associated companies' earnings (EBITDA) amounted to -2,971 (9,082) kSEK.
• Profit after financial items amounted to -16,502 (-6,681) kSEK, impacted by depreciation of capitalized development costs, which starts already during development.
• EBITDA per share amounted to -0.16 (0.49) SEK.
• Profit per share after financial item amounted to -0.89 (-0.36) SEK

CEO Comments

Building Towards a Stronger Future.
Q2 was softer than expected. Compared with Q2 2025, lower game sales, project funding, and capitalized development work had a combined negative impact. TMNT launched during the quarter, but launch-period revenue did not offset these declines. In response, we accelerated measures to align our cost base with the current revenue outlook, strengthen liquidity, and create a more focused foundation for Beyond Frames' next phase, while exploring higher-margin opportunities across XR and adjacent areas.

Studios
We entered the launch of TMNT with strong pre-release sentiment, positive player feedback, and encouraging wishlist activity. Initial player reception was stronger than for any previous Cortopia launch. However, sales conversion and organic momentum were below our expectations. As communicated in May, we consequently withdrew the previously announced long-term sales target for the title. Although the launch did not deliver the commercial returns we had anticipated for our shareholders and licensing partners, player reception remains encouraging. We will continue targeted organic support for the game with the IP owner, marketing partners, and platform holders to evaluate opportunities to expand its audience. After the quarter, we secured USD 1.9 million in project funding from an undisclosed partner for a new title currently scheduled for release in 2028. Again, this proves our capability to leverage our experience, capabilities, and strategic relationships developed in recent years.

Strengthening Our Financial Position
Following the launch, our immediate priority was to align the organization with the company's revised revenue outlook. Lower game sales, project funding, and capitalized development work had a combined negative impact of SEK 17.0 million in Q2 compared to last year: SEK 10.2 million from game sales, SEK 3.6 million from project funding, and SEK 3.2 million from lower capitalization. The measures announced during and after the quarter target annual operating-cost reductions of SEK 27-36 million.

After the quarter, we also sold select publishing rights for USD 1 million, payable in installments through the first quarter of 2029. The initial USD 300,000 payment is scheduled for the third quarter of 2026. After the quarter we have also carried out a directed share issue of approximately 3.1 MSEK and intend to carry out an additional share issue, subject to the decision of the EGM. Selling these publishing rights and the directed share issue gives us a stronger cash position near-term and allows us to invest in new projects and focus on our evolving strategy long-term. Taken together, the cost reductions, project funding, and rights sale have extended our expected liquidity runway. Based on our current operating plan, we expect to fund operations through the first half of 2028, when the newly financed title is currently scheduled to launch. Our goal is to secure even more project funding in the future.

Evolving Our Strategy
The portfolio-led strategy pursued since 2022 helped us to build valuable partnerships, production capabilities, market knowledge, and a broad catalog. Our near- and medium-term focus is now to apply these capabilities to higher-margin opportunities across XR and adjacent areas of interactive entertainment, including PC and console projects, as well as non-gaming enterprise partnerships. This represents an evolution of our operations while remaining grounded in the expertise and relationships developed over the past several years. With financing secured for a new project, revenue from our retained portfolio, and a more cost-efficient organization, we believe Beyond Frames enters this next phase on stronger footing.

Thank you to our players, team members, partners, and shareholders for your continued support.

Ace St. Germain,
CEO Beyond Frames Entertainment AB (publ)

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