Stillfront Group (SF) Q2 2024 earnings summary

Executive summary

• Net revenue for Q2 2024 was SEK 1,744 million, down 4% year-over-year and flat sequentially, with organic net revenue also declining 4%.

• EBITDA/EBITDAC margin reached 29%, the highest in three years, up 8 percentage points quarter-over-quarter, driven by lower user acquisition costs and improved efficiency.

• Gross profit margin improved to 80%, up two percentage points year-over-year, supported by a higher share of DTC bookings.

• Free cash flow for the quarter was SEK 272 million, nearly doubling sequentially and enabling share buybacks and deleveraging.

• Staff costs fell 12% year-over-year, reflecting efficiency measures and cost reductions.

Financial highlights

• Net revenue: SEK 1,744 million, down 4% year-over-year; gross profit: SEK 1,396 million, gross margin 80%.

• EBITDA/EBITDAC margin at 29%, up 8 percentage points quarter-over-quarter and 0.5 points year-over-year.

• Free cash flow for the quarter was SEK 272 million, with cash position at SEK 895 million.

• CapEx was SEK 852 million (8.7% of net revenues), down SEK 40 million from last year.

• Net result: -107 MSEK; EPS: -0.22 SEK.

Outlook and guidance

• Lower activity levels expected to continue into Q3 due to seasonality, with plans to reaccelerate user acquisition and scale new titles in late Q3 and Q4.

• Profitability measures and cost-saving initiatives are ongoing to improve efficiency.

• UA levels expected to average 27–28% of net revenues over the next 12 months, higher than previously guided, but offset by gross margin gains.