Flexion Mobile (FLEXM) Q1 2025 earnings summary

Executive summary

• Achieved high end of Q1 revenue guidance with strong momentum continuing into Q2.

• Five high-profile game launches in Q1, including titles from King, EA, MY.GAMES, Wildlife Studios, and Microfun.

• Distribution business grew organically, offsetting a decline in marketing revenue.

• Portfolio expanded to 35 revenue-generating games, with new titles contributing 25% of Q1 revenue.

• Regulatory changes and new channel partnerships, including Epic Game Store, expected to drive future growth.

Financial highlights

• Total revenue decreased by 2% year-over-year to GBP 17.9m (GBP 18.3m).

• Gross profit fell 20% year-over-year to GBP 3.2m (GBP 4.0m); gross margin declined from 22% to 18%.

• Adjusted EBITDA dropped 57% year-over-year to GBP 0.7m (GBP 1.6m).

• Operating result was GBP -0.9m (GBP -0.4m); EPS at -1.88 pence (-0.94 pence) year-over-year.

• Operating cash flow was GBP 1.5m (GBP 2.7m); cash and cash equivalents increased to GBP 14.4m (GBP 13.8m).

Outlook and guidance

• Q2 sales expected in the range of USD 22m–25m, supported by newly launched games.

• Margins anticipated to decline slightly through H1 2025 due to changes in framework deal terms, then stabilize.

• Ongoing focus on operational efficiency, with a 7% reduction in overheads.

• Robust sales pipeline and continued selective sourcing of top-tier games.