Stillfront Group AB (publ)

Stillfront reported net revenue of SEK 1.323 billion, down 1.3% organically and down 8% on an absolute basis, with FX and divestments weighing on reported revenue. Adjusted EBITDAC was SEK 387 million, up 3% year over year, and the adjusted EBITDAC margin improved to 29% from 23% in Q1. Gross margin rose to 84%, up 2 percentage points year over year, and DTC bookings were 46% of bookings versus 39% in Q2 last year. Free cash flow was SEK 519 million, including about SEK 196 million from the Gameberry settlement. On a franchise basis, Jawaker grew 11%, Supremacy declined 2%, BIG grew 79%, BitLife declined 19%, Empire grew 2%, Albion grew 10%, Board grew 24%, and Other games declined 24% organically. For the balance sheet, total net debt ended at SEK 4.6 billion including all earn-outs, down SEK 621 million from the prior quarter, while net debt including next 12-month cash earn-outs was SEK 4.4 billion and leverage was 2.2x. Management did not provide numeric next-quarter or full-year guidance.

Alexis Bonte said the company is becoming a more focused, franchise-led business and emphasized that the strategy is working, pointing to two consecutive quarters of double-digit organic growth in key franchises. He highlighted major franchise-specific progress in Jawaker, BIG, Albion, and Empire, while noting that Big Farm: Homestead showed that launch investments can keep producing returns after the initial ramp. His tone was confident but measured, especially around the CEO transition and strategic review, saying the company is now better set up and that he remains committed until a successor is in place.

Emily Villate focused on the financial improvements: net revenue of SEK 1.3 billion, adjusted EBITDAC of SEK 387 million, margin of 29%, gross margin of 84%, and UAC of SEK 340 million versus SEK 436 million a year ago. She said lower UAC, higher DTC mix, and the Gameberry settlement supported cash generation, with cash flow from operations at SEK 644 million and free cash flow at SEK 519 million. She also detailed capital allocation and balance sheet progress, including SEK 1.307 billion in LTM free cash flow, SEK 404 million directed toward deleveraging, SEK 220 million in share repurchases tied to earn-out settlement, and net debt falling to SEK 4.6 billion including earn-outs. She noted the refinancing and liquidity actions: a SEK 1 billion bond refinancing, a SEK 2 billion revolving credit facility through June 2028, and extension of a EUR 60 million term loan to 2028.

Analysts focused on whether lower UAC signaled a weaker revenue environment ahead and whether Alexis Bonte’s CEO succession meant he was leaving for a specific reason. Management said UAC was lower mainly because Big Farm: Homestead launch spending normalized and because Supremacy faced a less favorable UA environment toward quarter end, but stressed they use strict ROAS criteria and will still deploy UA when returns are attractive. On the CEO question, Bonte said the board brought him in to execute a turnaround and that, after two quarters showing the strategy is working and the team is in place, it is the right moment to pass the baton when a successor is found. In a separate exchange, management said Jawaker’s rebound was not a surprise and reflected the franchise’s resilience, strong brand, and limited dependence on UA.