Devolver Digital Unaudited Preliminary Results: Year Ended 31 December 2023

Key insights

6 takeaways

01
FY23 revenue fell 31% to US$92.4m, and Adjusted Gross Profit fell 42% to US$27.0m, reflecting the quieter major-title release schedule.See it on page 7
02
Devolver released three major titles in 2023 compared with five in 2022, which the company says was a quieter release schedule.See it on page 4
03
Revenue in 2H 2023 grew 10% over 1H 2023, and Adjusted EBITDA before impairments moved to a US$1.7m profit in 2H 2023.See it on page 8
04
Back catalogue titles accounted for 83% of total 2023 revenues, and back catalogue revenue rose 25% year-over-year, driven mainly by Cult of the Lamb.See it on page 4
05
Cash and cash equivalents were US$42.7m at 31 December 2023, down from US$79.5m a year earlier, mainly due to lower operating cash generation, US$28.0m of game development investment, US$6.8m to the EBT, and US$18m for System Era.See it on page 8
06
The company expects a return to profitable growth in 2024, which it says reflects its planned release schedule and back catalogue momentum.See it on page 8

Summary

Devolver Digital, Inc., a Wilmington, Delaware-based indie video game publisher and developer, released unaudited preliminary results for the year ended 31 December 2023, prepared under IFRS and approved by the Board on 17 April 2024. Revenue for FY23 was US$92.4m, down 31% year-over-year from US$134.6m in 2022. Adjusted Gross Profit was US$27.0m, down 42%, with a pre-impairment margin of 29.2% versus 34.4% in 2022. Adjusted EBITDA before performance-related impairments was US$1.7m, compared with US$23.2m in 2022, and the statutory loss for the year was US$12.7m attributable to equity holders of the parent (2022: US$91.5m loss).

The company attributed the weaker year to a quieter release schedule, with three major titles out of 11 games released in 2023 compared with five major titles out of 12 in 2022. Revenue in 2H 2023 rose 10% over 1H 2023, and Adjusted EBITDA before impairments moved to a US$1.7m profit in 2H 2023 from a US$2.5m loss in 1H 2023. Cash and cash equivalents stood at US$42.7m at year end, down from US$79.5m in 2022.

The company expects 2024 to deliver profitable growth, citing ten planned new titles and System Era, acquired in late October 2023 for initial consideration of US$18m net of cash acquired. Back catalogue revenue rose 25% year-over-year in 2023, with back catalogue titles accounting for 83% of total revenues.