THQ Nordic Interim Report: 1 January - 31 March 2017

THQ Nordic’s interim report for the first quarter of 2017 highlights a period of significant financial growth and operational expansion. The company’s primary objective remains the capitalization of its extensive portfolio of acquired franchises through an active asset care program and the development of new sequels. By the end of the quarter, the firm was managing 32 active development projects, reflecting a strategic shift toward internal production and the preparation of major sequels for the latter half of the year.

Financial performance for the quarter was strong, with net sales increasing by 90% to SEK 81.9 million compared to the same period in the previous year. Operating profit (EBIT) saw a substantial rise of 125%, reaching SEK 31.9 million, which yielded an EBIT margin of 39%. Owned titles accounted for 67% of total net sales, underscoring the success of the company’s intellectual property strategy. EBITDA grew by 81% to SEK 41.9 million, driven by increased sales volume and realized economies of scale.

The company maintains a global publishing reach with operations centered in Sweden and Austria, employing over 90 staff members and collaborating with more than 400 individuals across four in-house studios. During the first quarter, the company launched five owned titles and one publishing title, while also finalizing the acquisition of the Rad Rodgers intellectual property. Despite this growth, management maintains a cautious outlook, acknowledging the company's status as a smaller participant in a highly competitive global industry. Key risks identified include potential delays in game development, market reception of new titles, and dependence on a limited number of major digital and physical distribution channels.