Stillfront Group Aktie

Good morning, and welcome to Stillfront's Q2 presentation. I am Alexis Bonte, and I'm joined by our CFO, Emily Villate today.

Before we go into financials, I will start by taking you through the key franchise in the quarter, including the progress that we've made and key developments.

Looking at the second quarter, we continue to make progress in building a more focused and franchise-led Stillfront. Net revenue amounted to SEK 1.323 billion, corresponding to an organic decline of 1.3%. This means that organic growth remained broadly stable despite the significant lower level of user acquisition investments compared with the first quarter.

Profitability strengthened clearly in the quarter. Adjusted EBITDAC increased to SEK 387 million. That corresponds to a margin of 29%, which is up from 23% in Q1. This was mainly driven by the normalization of launch investments in Big Farm: Homestead as well as a broader reduction in user acquisition costs.

We also saw continued double-digit growth in our key franchises, which grew organically by 10% in the quarter. This was the second consecutive quarter of double-digit organic growth in the key franchises. And this is a statement to our strategy to focus on our key franchises and the fact that, that strategy is working.

Finally, cash generation was strong. Free cash flow amounted to SEK 519 million in the quarter, supported by the underlying businesses as well as the upfront settlement with Gameberry. This strengthens our ability to continue reducing debt while investing selectively in our key franchises.

I will now go through the financial development in more detail, starting with Jawaker. So Jawaker delivered a strong quarter, returned to double-digit organic growth.

Net revenue amounted to SEK 223 million, corresponding to organic growth of 11%. This represents a clear rebound from the slowdown in commercial activity you saw in the first quarter.

Looking ahead, our focus remains on expanding Jawaker's presence in Syria and Iraq, supported by reseller partnerships and marketing initiatives. We continue to see long-term growth opportunities in the franchise, supported by its very strong local relevance, it's very loyal player base and a strong, established market position and brand.

We move on to Supremacy now. Supremacy reported net revenues of SEK 214 million, corresponding to an organic decline of 2% in the quarter. This development reflected a more challenging user acquisition environment for the existing titles compared with the favorable marketing conditions that we saw in the first quarter. At the same time, the team continued to focus on technical improvements and on preparing Supremacy: Warhammer 40,000 for global launch. The game is now currently in soft launch, and the focus is on refining the player experience, improving technical performance and -- in order to ensure a high-quality global rollout.

If you move on to BIG now. BIG continues to perform very strongly in the second quarter. Net revenues amounted to SEK 172 million, corresponding to organic growth of 79%. This was driven by the continued momentum in Big Farm: Homestead after a successful global launch as well as continued strong performance in Sunshine Island.

So the franchise maintained positive momentum. This is despite significantly lower user acquisition investments compared with the launch-intensive first quarter when we launched Big Farm: Homestead. This shows that the investments made during the launch phase continue to deliver even as investments level normalized. So this is a definition of a successful launch.

As we have said before, we do not expect the same pace of growth to continue quarter after quarter, but the performance in Q2 confirms that Big is developing well and that we've been able to build on the strength of the franchise through both new games development and strong live ops execution.

We now move on to BitLife. BitLife reported net revenues of SEK 109 million. This corresponds to an organic growth decline of 19%. The year-on-year decline was mainly driven by challenging comparison figures and the more disciplined user acquisition approach in the franchise. If we look ahead, comparison figures are less challenging. At the same time, revenue actually improved sequentially compared with the first quarter and it was supported by strong live ops execution. Some of you may recall that we stated that we'll be investing in live ops kind of engine there.

And actually, as a result during the quarter, BitLife released the Ultimate Fighter Mode feature, which actually became the franchise's best-selling expansion pack to date. So clear indications that the franchise is starting to head in the right direction.

Empire. Empire delivered a strong quarter with net revenue of SEK 104 million and organic growth of 2%. This was the franchise's highest quarterly net revenue since 2024, which is a strong achievement for a game that has been live for 14 years. The performance was supported by strong monetization, live ops and a very good execution of in-game events.

Empire continues to demonstrate the strength of long-lived player communities and the value of operating established games with discipline and consistency. At the same time, the team continued to invest in new game development within the franchise with the development of the new upcoming game, Empire: Titans and Dragons. So very excited about Empire and its future.

If we move on to Albion. Albion returned to growth in the second quarter. Net revenue amounted to SEK 95 million. This corresponds to an organic growth of 10%. The growth was supported by the successful launch of the title on the Xbox Series X in April, which marked Albion's first expansion into console. This is an important milestone for the franchise as it broadens Albion's addressable player base and gives the game access to a new platform.

The quarter was also supported by strong feature releases and player engagement. Albion continues to benefit from an established and engaged community and the console launch provide broader foundation for the franchise going forward.

So with Albion clearly delivering on the strategy that we had set.

In terms of Board. Board continued strong development in the second quarter. Net revenue amounted to SEK 71 million, corresponding to an organic growth of 24%. The performance was driven by strong development in Ludo Club, which remains an important contributor to the franchise. The team also continued to roll out live ops improvements, including greater automation of in-game events and offers.

If we move on to Other games. Other games reported net revenue of SEK 334 million. That corresponds to an organic decline of 24%. The decline reflects the continued underlying development in the remaining portfolio, but also really a deliberate reduction in user acquisition as we continue to focus on profitability and disciplined capital allocation.

In addition, we successfully divested OFM Studios during the quarter and the Gameberry settlement. And this, of course, impacts the reported net revenues in Other games from June onwards.

And with that, I will hand to Emily to take you through the financials in more details.

Thank you, Alexis, and good morning, everyone. Let's jump right into the financial details. We reported net revenues of SEK 1.3 billion for the quarter, representing an organic decline of 1.3%. As Alexis noted, this was driven by strong performance by our key franchises, which grew organically by 10% year-on-year, offset by a decline of 24% in our Other games portfolio.

On an absolute basis, net revenue was down 8% year-on-year, driven by negative FX impact of 3 percentage points as well as the recent divestments of narrative, OFM and the Gameberry settlement, together having a negative 3 percentage point impact.

While organic growth was broadly stable compared to Q1 the last quarter, our strategic focus on our direct-to-consumer channel keeps yielding results, and our gross margin increased by 2 percentage points year-on-year, reaching a strong 84%.

DTC,our direct-to-consumer revenue, now accounts for 46% of bookings, a proper step-up from the 39% we saw in Q2 of last year. And this is strengthening, not just our margins, but also our direct engagement with our player communities.

On to UAC, which amounted to SEK 340 million in the quarter, down from SEK 436 million in Q2 of 2025. This corresponds to 26% of net revenue spent in UAC in this quarter compared to 30% last year. And the year-on-year decrease was driven by a more strict user acquisition approach.

Sequentially, UAC decreased from SEK 447 million, driven by the investments in Big Farm: Homestead normalizing in Q2, following the trampoline launch in Q1, but also a broader reduction in UA costs, particularly towards the end of the quarter.

Adjusted EBITDAC amounted to SEK 387 million, which is an increase of 3% compared to last year. And it is great to see that we're achieving this while our reported revenues and organic growth decline year-on-year. The adjusted EBITDAC increase was primarily driven by decreased UAC and higher share of DTC bookings driving a higher gross margin. The increase was partly offset by a decline in reported net revenues, primarily from recent divestments, together with a total negative FX EBITDAC effect of approximately negative SEK 23 million.

And the adjusted EBITDAC margin increased to 29%, up 3 percentage points on the same quarter last year.

Moving on to our cash flows. We reported SEK 644 million in cash flows from operations for the quarter. And this quarter's cash flows benefited from a total of approximately SEK 245 million related to the Gameberry settlement.

SEK 196 million recorded within items affecting comparability and the remaining balance came from working capital movements.

Working capital movement overall positively impacted cash by SEK 73 million in total which was underpinned by tax payments of some SEK 38 million in the quarter.

Cash flow from investing activities was SEK 611 million, and this primarily reflects cash earnout settlements in the quarter of some SEK 515 million. In addition, we had product development spend of SEK 117 million, mainly relating to our key franchises in line with our strategy to focus capital and resources towards our key franchises.

These costs were partly offset by the divestment of OFM as an impact of plus SEK 24 million in the quarter. Cash flow from financing activities was a positive SEK 206 million in the quarter, mainly relating to the drawn RCF in correlation with our earn-out payments, which took place in Q2.

Free cash flow for the quarter increased to SEK 519 million, which was greatly impacted by the upfront Gameberry settlement of approximately SEK 196 million.

Now on an LTM basis, we generated SEK 1.307 billion in free cash flow or SEK 841 million when adjusting it for the upfront element of the Gameberry settlement. Of this, SEK 469 million went towards earnout cash payments, minority buyouts and the divestment of OFM and the narrative portfolio.

SEK 404 million was directed towards deleveraging. And additionally, we completed SEK 220 million in share repurchases, which went towards the settlement of earn-out.

To summarize, our underlying cash-generating capacity remains very healthy.

Now turning on to our financial position. We ended the second quarter of 2026 with total net debt of SEK 4.6 billion, including all earn-outs, a significant SEK 621 million reduction from the SEK 5.2 billion in the last quarter. This reflects our strong underlying cash generation in the quarter, further improved by the Gameberry settlement.

In terms of our net debt and leverage ratio, including next 12-month cash earn-outs, it remained stable at SEK 4.4 billion and 2.2x leverage ratio, respectively. This is a mix effect of the strong underlying cash flow and the Gameberry settlement, offset by adding the next 12 months cash out earn-out obligations.

And as noted by Alexis in his CEO letter for Q2, as the payments continue to absorb cash and as earn-out payments continue to absorb our cash in the near term, we are moving closer to the important inflection point we have in Q2 of 2027 when the remaining earn-out obligations will all be settled. The resulting release of a new cash flow will strengthen our capacity to deleverage, which remains our near-term capital allocation priority.

During the quarter, we also successfully settled the SEK 1 billion bond refinancing secured during Q1, and we secured our revolving credit facility, now at SEK 2 billion through June 2028.

And lastly, post the quarterly close, we extended our EUR 60 million term loan facility with the Swedish Export Credit Corporation, now maturing in 2028, continuing our diversified financing platform.

With this, we improved Stillfront debt maturity profile with all debt now maturing beyond the final earn-out settlements taking place in Q2 of 2027, while maintaining a sound level of financial flexibility. In short, we're in a very good position to keep calm and carry on.

Now handing back over to you, Alexis, to wrap up. Alexis. I believe you're on mute.

Thank you, Emily. Thank you very much as well for going over the financials. Before we open up for Q&A, I would like to summarize our recent events and priorities going forward. First, our focus on key franchises remains unchanged. The second quarter again demonstrated our key franchises are the main driver of Stillfront's organic development. with double-digit growth for the second consecutive quarter. This is a clear indication that our strategy to focus on these key franchises is working. Second, the strategic review remains ongoing. During the quarter, we completed Gameberry settlement and successfully divested OFM Studios. These transactions simplified the Group and allow us to focus resources on their franchise and studios with a stronger long-term prospects. .

Third, as announced at the end of June, the Board and I have agreed to initiate a CEO succession process. I remain fully committed to leading Stillfront until the successor has been appointed and to ensuring continuity and an orderly hand over.

Importantly, this transition does not change Stillfront's strategic direction. We will continue to focus on execution, profitability, cash generation, and long-term value creation through our key franchises. Our strategy is working, and I want to thank the teams for their strong execution again in Q2.

With that, I want to thank you for joining today, and we are ready to take your questions. So please go ahead.

[Operator Instructions] The next question comes from Nick Dempsey from Barclays.

I've got 2 questions for you. So first of all, having followed Stillfront for a little while, it tends to be if the UAC has dropped, particularly when we're rolling towards the end of the quarter. That's because the environment is looking less attractive for deploying it. And therefore, we should watch out for a more negative rate of organic revenue growth in the coming quarter or quarters.

Can you maybe just talk about the environment for deploying UAC? And I know you're not going to give us guidance, but help us understand whether we should be looking out for a weaker revenue growth trajectory as a result of that environment?

The second question is just on the sort of decision for the -- related to the CEO. Can you maybe just give us a bit more background, Alexis, on -- is it something that you're moving on to that you have decided to go to or what the motivation is there because we don't have a lot of detail on that.

Thank you, Nick. I'll start with the first question in terms of the UAC. I think the main change in terms of UAC is obviously, we're moving away from the from the high-intensity launch of Big Farm: Homestead that we had in the first quarter, what we call, trampoline launches. And so now we're kind of -- we're still obviously aggressively investing in the title, but at a lower level. So that's what Emily explained.

The second thing as well is what I mentioned to the Supremacy, we would have liked actually to allocate a bit more UA for Supremacy towards the end of the quarter. But the environment wasn't favorable for that in the quarter. But what we tend to see -- I wouldn't read too much into it either because the UAC environment, as you know, is very dynamic and tends to move sometimes in slightly unpredictable ways.

So you might expect to have a very strong UA ability to allocate a lot of UA in a certain month, and then you're not able to do so, but then you're able to do so the month afterwards.

So there's a lot of movements. But -- it's not completely incorrect to say that, yes, we're seeing weaker UAC allocation possibilities that we expected, at least, in particular for Supremacy. I don't know if you want to build on UAC point, Emily.

I think that's -- I mean, that's correct, particularly towards the end of the quarter, end of June. That environment weakened. But we apply, as you noted, Alexis, we apply very strict ROAS criteria to our UA, and we will continue to be very strict in how we assess our ROAS and our returns. But we will also take the opportunity to deploy UA where we have the abilities. And if we have a good global launch, such as the one we had with Big Farm: Homestead in the future, you can expect UA and revenues to increase. Of course, UA investment is taken upfront and the full revenue potential and profits are taken over time.

And as for the second part of your question, Nick, basically, when the Board asked me to step up as CEO a little under 2 years ago, my objective was really to set the group and the company out to a new strategy and really kind of see if that strategy, we were able to execute it, build a team, a new kind of exec team that was able to take the company to the next level and execute on that turnaround and start delivering on that turnaround. I think we've now had 2 successive quarters that demonstrate that the strategy is working.

So I feel that when discussing with the Board, I feel that the group is now kind of well set with a strong strategy, strong execution, strong new team and it will be the right moment, I think, to pass on the baton to a new CEO when we find that person. But I remain fully committed until we do that transition.

[Operator Instructions] The next question comes from Rasmus Engberg from Kepler Cheuvreux. .

Just coming back to the -- to your decision together with the Board to step down. As you say, you've done really good progress in turning the company around. But -- does it -- I mean you did also launch a strategic review that is still ongoing. Do you think you might be able to finish that before you leave? Or how should we think about it?

Yes, Rasmus. I mean, basically, as you see, we've done quite a few divestments. They're not massive divestments, but we've done a lot of small divestments that have allowed us to basically clean up a lot of things outside of our key franchises and have been quite clear about the fact that we want to focus on our key franchises. .

Now the fact that we're also saying that the strategic review remains ongoing, means that there might be more to come, and we will close it when we feel that, that is completely. Whether that is completed before a new CEO comes in or not, that hopefully is not 100% within my control, but we continue with the strategic review open, yes.

All right. And the second question, it certainly surprised me a lot that you Jawaker rebounded so strongly. Given the ongoing ups and downs in the turbulence in the region they operate, how -- can you shed some light on what you're seeing now? Does it continue to show reasonable progress? Or has it reverted back again as bombs start flying?

No. I think what we see with Jawaker is that it's a tremendously resilient community and game. I mean, when really we were at the maximum possible difficulties in the region, the franchise still grew by 1%. And you see the situation with easing out, we're back to a double-digit growth. Also to give a bit of extra context and we did mention this when we spoke about the Q1 results, we did have an exceptionally strong with a lot of sales Q4 for Jawaker. So that impacted a little bit the -- negatively also the Q1 results. .

So yes, Jawaker, what I can say, it's a very, very resilient part of our business, obviously, a very profitable part of our business, extremely strong brand in the region, very, very unique product, very community-led, not UA dependent. So yes, very, very -- so I'm very confident about the continued stability within Jawaker's .

Did it surprise you that it rebounded so strongly after Q1? Or was that explained by also you had the religious period and being earlier? Or was this in line with your expectations?

No, we were not surprised. We did maybe expect a bit more negative impact from the World Cup, from the FIFA World Cup. Usually, that tends to make it a little bit difference, but we were not -- I mean it was -- there was less impact than we expected there. But other than that, there was no big surprises.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Well, with that, thank you very much for joining our call. I hope that you found it informative. And again, we continue delivering on our strategy. I think it's now 2 strong quarters in a row for our key franchises with more than double-digit growth. And we will basically continue executing on the strategy that is working. Thank you for your time.

Good morning, and welcome to the Stillfront Q1 Presentation. I am Alexis Bonte, the CEO of Stillfront, and I'm joined today by our CFO, Emily Villatte. Before we get into the quarter itself, let me start with a brief reminder of who we are and how we are building the business. Stillfront is a global gaming company focused on forging gaming's next forever game franchises, one community at a time.

Today, we reach around 36 million players every month, and our strategy is centered around 7 key franchises, where we focus our resources on the games with the highest long-term potential. Our key franchises have strong player communities and predictable cash flows. And by concentrating capital, talent and product development behind them, we are building a more resilient and scalable business over time.

As we summarize the first quarter of 2026, we delivered a stable start to the year with flat organic growth while continuing to see strong performance in our key franchises. Our key franchises grew organically by 12%, highlighting the strength of the portfolio and the progress we are making in scaling our most important assets. This is a clear validation that our strategy to focus on our 7 key franchises is yielding results with superior growth to the market.

Growth was supported by several of our key franchises with the big franchise delivering an exceptional organic growth of 88%, following the continued scaling of our new game, Big Farm: Homestead and the broader strength of the franchise. At the same time, we increased our user acquisition spend to capture attractive growth opportunities, which supported scaling in key game franchises such as BIG, but also Supremacy, and that impacted profitability in the quarter.

Adjusted EBITDAC amounted to SEK 311 million, corresponding to a margin of 23%, and that reflects both higher UA investments as well as FX headwinds. Finally, we also strengthened our financial platform through a SEK 1 billion refinancing transaction, which was settled on April 27. This improved our debt maturity profile, pushing maturities beyond the period of earnouts.

Next, I would like to zoom in a bit on BIG and walk you through development in a little more detail. So during the quarter, we continue to build the early momentum and encouraging signs that we saw in Big Farm: Homestead following the launch of it at the end of Q4 2025 in December to be precise. At the beginning of Q1, Homestead entered the global launch and became our most successful new game launch to-date.

By applying the lessons learned from Sunshine Island, both what worked well and what could have been done better, we are able to scale and monetize the game effectively. This demonstrates our ability to develop and scale new games within our key franchises. We also continue to see strong growth in Sunshine Island during the quarter. Together, Sunshine Island and Big Farm: Homestead drove organic growth of 88% in the franchise.

The quarter also reflected increased user acquisition investments with higher spend supporting the scaling of both titles. This had a negative impact on profitability in the quarter, but we view it as a value-creating investment in line with our investment criteria. That said, we do not expect the same pace of sequential growth to continue quarter-after-quarter.

If we look at Sunshine Island, growth will gradually stabilize after the initial launch phase. And we also see normal patterns where Q4 and Q1 tend to be particularly strong, while Q2 is usually slower. But we're very happy with the performance of the BIG franchise, and we are seeing excellent results there. Going over our other key franchises, starting with Supremacy, revenue amounted to SEK 247 million.

That corresponded to also a good organic growth of 15%. The quarter benefited from strong live operations execution from the team and also favorable marketing conditions, including a higher engagement linked to geopolitical events. Looking ahead, of course, one of the key milestones for the franchise is the planned global launch of Supremacy: Warhammer 40,000.

In Jawaker, revenue came in at SEK 190 million with organic growth of 1%. Growth was held back by a more challenging environment in the Middle East, but the franchise continues to hold a strong long-term position supported by a loyal and engaged player community. In BIG, revenues reached SEK 178 million. As I already said, that corresponds to an organic growth of 88%.

Performance was driven by continued momentum in Sunshine Island and the successful scaling of Big Farm: Homestead following its global launch earlier this quarter. The focus here remains on scaling the current portfolio while continuing to invest in new game development. If we now look at Empire, revenue came in at SEK 97 million with organic growth of 1%.

Content updates and in-game events helped stabilize the revenue trend versus recent quarters, while the franchise continues to deliver strong profitability despite ongoing investments in the new game for the franchise. For BitLife, revenue was SEK 95 million with organic growth of minus 19%.

The decline was mainly driven by a more disciplined UA approach, and -- but we continue to strengthen the product during the quarter through webshop enhancements, tutorial improvement and broader onboarding. And we really think that we have the possibility to get this franchise back to growth over the medium-term. For Albion, revenue was SEK 81 million, corresponding to organic growth of minus 4%.

The game continues to benefit from an established and engaged player base. And during the quarter, the main focus was on preparing the Xbox Series X and S launch, including a big graphical [ overhaul ], and all of that happened in April 21 of this quarter. In Board, revenues amounted to SEK 68 million with organic growth of 20% -- 22%, so strong performance.

The franchise continues to perform well, supported by ongoing product improvements and healthy player engagement. And finally, Other games generated revenue of SEK 377 million. That corresponds to an organic decline of 21%. And while this portfolio is still weighted on top line development, the pace of decline has moderated sequentially and other games continue to drive significant cash flow for global business.

Now, we'll switch over to Emily for more on financials.

Thank you, Alexis, and good morning, everyone. Great to be here. All right. Let's talk through our Group financial results for the first quarter. We reported net revenues of SEK 1.333 billion for the quarter, representing flat organic growth. Given the double-digit decline we saw in 2025, this is a material improvement. As Alexis noted, this was driven by strong performance in our key franchises, which grew organically by 12%, offset, of course, by the decline of 21% in our Other games portfolio.

On an absolute basis, net revenue was down 14% year-on-year. And this was due to heavy negative impact from FX that impacted by 10 percentage points as well as the divestment of the Narrative portfolio, which you will recall took place at the end of Q4 of 2025. The impact from the Narrative portfolio divestment will, of course, carry through the year.

Now while organic growth was flat, our strategic focus on our direct-to-consumer channel keeps yielding very solid results, and our gross margin did increase by 3 percentage points year-on-year, reaching a strong 84%. DTC revenue accounted for 44% of our bookings, which is a proper step-up from the 36% of bookings that we saw last year. And as you know, this is strengthening not just our margins, but also our direct engagement with our loyal player base.

Moving on to UA. User acquisition spend for the quarter was SEK 447 million, which is on par with last year. As a percentage of revenue, of course, the UA spend was 34%, which is up from the 29% we saw in Q1 of 2025. And an unusually high UA percentage was primarily driven by the growth opportunities that Alexis has mentioned, mainly in the BIG franchise, but also within the Supremacy franchise.

And the UA marketing deployed for the new game, Big Farm: Homestead, if you look at that specifically, represented 6% of total Group revenues. So if we were to adjust for the UA spend on this new game launch, the Group deployed 28% of net revenues in UAC, excluding what we spent on Big Farm: Homestead, which is more in line with previous quarters. Moving to profitability. Our adjusted EBITDAC was SEK 311 million in the quarter compared to SEK 402 million last year.

And this decline reflects our active UAC investments as well as FX headwinds, which were quite heavy and impacted EBITDAC by approximately SEK 50 million. And our adjusted EBITDAC margin as a result of this declined to 23% in Q1 of 2026. Moving on to cash flows. We reported SEK 167 million in cash flow from operations for the quarter. And I will note that this period was impacted by tax payments of SEK 93 million and a negative movement in working capital of SEK 94 million, both of which were influenced by timing effects.

Cash flow from investing activities was a negative SEK 118 million, and this primarily reflects our continued investment in product development, in other words, on games. Cash flow from financing activities of negative SEK 113 million in the quarter were mainly driven by debt repayment and share buybacks.

And free cash flow, as you have noted no doubt for the quarter declined to SEK 44 million, which was heavily impacted by the higher level of UA investments, but also FX headwinds, coupled with the timing effect from tax payments and working capital. So on an LTM basis, which I think is a more relevant way to look at our cash flows instead of the quarterly free cash flows, which are often impacted by working capital fluctuations, we generated SEK 772 million in free cash flows on an LTM basis.

So if we break this down, we can see that SEK 567 million went towards earn-out cash payments, minority buyout and the divestment of the Narrative portfolio. SEK 240 million was directed towards deleveraging. And additionally, we completed SEK 280 million worth of share buybacks. So to summarize our cash flow, I would say that our underlying cash generating ability and capacity remains very healthy.

Turning now to our financial position. We ended the first quarter of 2026 with total net debt of some SEK 5.2 billion, including all earn-outs, which is a significant SEK 500 million reduction from the SEK 5.7 billion in total net debt we had in the same quarter last year. And this, of course, is in line with our commitment to settle our earn-out debt and lowering our debts as a whole.

In terms of our net debt, including next 12 months cash earn-out, it remains stable at SEK 4.4 billion. Due to our active investments to drive growth as well as heavy impact from FX, our EBITDA declined on an LTM basis, and our leverage ratio was 2.2x in Q1 of 2026. And I note that the leverage ratio would have been around 2x if FX rates had been stable.

Now during the quarter, you will have noted that we successfully concluded a SEK 1 billion bond refinancing exercise and settlement occurred on April 27. The prospectus for the new bond will be published on our website any day now, so to keep an eye out for that. And by refinancing our bond to now mature in April 2030, we are improving our debt maturity profile.

And importantly, this pushes all of our bond maturities beyond the period of the earn-out obligations that conclude mid-2027. Our RCF has also been rightsized from SEK 2.5 billion to SEK 2 billion in light of reduced financing needs. And the RCF has also been extended to 2028. And this combined really creates a stronger financial foundation for continued disciplined execution of our strategy with selective investments in our key franchises.

Now, handing back to Alexis to wrap up.

Thank you very much, Emily. So as we look ahead, we continue into 2026 with a clear focus on execution and incremental improvements across the business. A key priority remains our continued focus on our key franchises where we are concentrating capital, talent and product development to drive scalable growth and long-term value creation.

At the same time, we're maintaining a disciplined approach to portfolio engagement, continuously evaluating performance and taking actions where needed. In parallel, the strategic review continues, and we remain committed to take action to enhance long-term shareholder value. We also now have a newly composed Board in place, adding further experience as we move forward and an AGM is coming up on May 13.

Pending approval from the SFSA, we will also see our 2030 corporate bond admitted for trading shortly. One exciting event that happened on April 21, as I said, was the Albion launch on Xbox Series X and S, and we look forward to monitoring the development of how that will perform in Q2.

I want to thank our shareholders for their continued trust and support as we approach the rest of 2026 with both discipline and ambition. The strategy is working, and we are continuing its implementation as we move throughout the year.

Now, let's open up for questions. Thank you very much.

[Operator Instructions] The next question comes from Rasmus Engberg from Kepler Cheuvreux.

What -- given the impact in this quarter of increased UA spend, do you have an outlook for EBITDAC or cash flow for the year that we can keep in mind?

Emily, why don't you take that question?

Yes, sure. Thank you for your question, Rasmus. We're not guiding specifically on cash flows or EBITDAC. But what I would note and reiterate, as we said in the -- during the call, is that particularly this quarter, we had some timing effects on our free cash flow. So I tend to look at the LTM free cash flows as a more relevant benchmark for how we're faring when it comes to free cash flow generation.

Clearly, the EBITDAC margin was a little bit lower this quarter compared to Q4 or previous quarters. When it comes to UA spend, which Alexis also noted during the call, the winter months are typically more favorable for deploying UA spend. Also, we have the combination of a new games launch where we have had successful -- a very successful launch, and we have been able to deploy UA in an effective way.

When we head into the summer months, it is a regular seasonal effect of typically spending a little bit less on UA. So those would be the typical seasonal patterns that we would see. Higher UA spend in combination with game launches and the winter months and then typically seasonally less UA as a percentage of revenue during the summer months.

Maybe I can just add a little bit of gaming color as well to what you just said, Emily. I think it's important to note that the success of the Big Farm: Homestead launch has really outstripped what we saw with Sunshine Island, and we want to make sure we capitalize on that opportunity.

As you know, it's difficult to launch new games in this market and even more difficult to launch new games successfully. Now this is the second game in a row that we launched successfully, and we're seeing even better results from this new launch. That being said, we're being very disciplined about the UA, how we spend that UA and the returns of that UA with existing games and also with new game launches. So this is all kind of pointing in the right direction.

Okay. Can you also help us a little bit with the performance of Jawaker? How did it perform during Q1? And how is it doing now with the continued war ongoing?

Yes, I'll start with that and Emily, if you want to build on that afterwards, please do so. So basically, what -- as you saw, Jawaker growth has slowed down in the quarter to 1% from its usual double-digit growth in previous quarters. That was impacted by 2 main events.

The first event, obviously, is the war that has had a slight impact to -- mostly to ARPDAU to the amount of money that people spend on the game for obvious reasons. But we see a lot of resilience as we saw in the communities. The other thing that has impacted is also Ramadan. Ramadan was earlier this year. It fell into Q1.

And Ramadan is usually a period where there is less use of Jawaker. So that's the kind of 2 main things. But we're seeing Jawaker as being very resilient. And obviously, we hope that the conflict will end soon, but we have no control over that. But we are definitely seeing strong resilience in Jawaker. Emily, I don't know if you want to add anything to that.

I think that's very comprehensive. Perhaps the only nuance is that the biggest impact on Jawaker was the war in the Middle East, then we had Ramadan. And it was a slightly slower start to the quarter. Main impact Middle East and Ramadan. And this remains a fantastic asset with incredibly engaged user base. So we're very positive about Jawaker.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you very much for your time. We, at Stillfront, are basically excited about the future. We are obviously very happy to see the performance of our key franchises that have grown by 12% year-on-year. We're also happy that we've returned to stable organic growth. So we continue to implement our strategy, and we thank you for your time.

Good morning, and welcome to the Stillfront Q4 Presentation. I am Alexis Bonte, the CEO of Stillfront. I'm joined today by our CFO, Emily Villatte, who joined us in December. I would like also to take the opportunity to thank Tim Holland for his work as interim CFO during 2025.

As we summarize the first quarter of 2025, I am pleased to report that Stillfront is delivering margin expansion despite revenue decline. We successfully expanded our adjusted EBITDAC margin to 27%, up from 25% in Q4 last year despite an organic revenue decline of 9%. This follows our cost savings efforts during the year, disciplined deployment of UAC alongside the continued rollout of our direct-to-consumer channel.

Looking at our business areas. In Europe, we delivered a big franchise new game launch with early positive signs, and we divested our noncore narrative portfolio, which has been impacting our organic growth. In North America, the continued revenue decline reflects a deliberate strategy of prioritizing cash flow and efficiency over short-term volume. MENA and APAC delivered strong results with 7% organic growth.

Now let's dive into the details. So first, turning to Europe. Net revenue in BA Europe landed at SEK 622 million for the quarter. That represents an organic decline of 6%. The revenue performance in Europe has been heavily impacted by the narrative games portfolio. And in late December, we concluded the divestment of the narrative franchise for a total consideration of $4 million. That reflects a 4x EBITDAC multiple for that portfolio. So excluding the narrative portfolio, organic growth for BA Europe was actually flat in the quarter.

In December, I'm happy to announce the release of the new game Big Farm Homestead. The game did not have material revenue impact in the quarter, but early performance metrics were encouraging. You will note that user acquisition costs correspond to 37% of net revenue, which is higher than the 31% we saw last year. This is -- this reflects a deliberate choice as we increased UA within the big franchise to capitalize on the good momentum there.

The Supremacy Warhammer 40,000 game, which was expected to launch in the middle of Q4 2025, did not meet yet the higher quality thresholds that we now report to ensure a strong launch. And therefore, we're polishing the game a bit more. We're adding some content, and we'll launch it later in the year.

Adjusted EBITDAC for BA Europe came in at SEK 94 million with a margin of 15% in the quarter. The lower margin compared to last year is primarily due to the lower revenue volume combined with the increased growth investments in UA, particularly in Q5 towards the later part of the quarter.

Moving on to North America. Net revenue for the quarter came in at SEK 197 million, corresponding to an organic decline of 31.3%. The decline was driven by our commitment to focus on profitability and cost efficiency over short-term revenue growth. While our volumes are lower, the quality of our revenue in North America has improved. Gross margin increased to 83%, up from 79% last year. A key driver here is the accelerated rollout of our direct-to-consumer channels in North America.

Following successful Webshop integration in Bitlife in Q3 and the Home Design franchise in Q4, direct-to-consumer bookings now account for 24% of the total, a significant jump from just 7% in Q4 last year. And during the quarter, we have exercised continued strict cost discipline. User Acquisition Costs were reduced to SEK 88 million compared with SEK 258 million in the same period last year. Personnel expenses were up to SEK 30 million, down from SEK 60 million before, and that demonstrated the full effect of the cost savings program that we implemented, in particular, Storm8 and Super Free.

The result of these actions is a clear turnaround in profitability for North America. Despite the lower revenue base, adjusted EBITDAC increased to SEK 23 million for the quarter, up from SEK 6 million last year, and this translates to a margin expansion to 12% compared to just 1% a year ago. And full year EBITDAC was up from SEK 100 million to SEK 108 million in North America.

Finally, let's look at MENA, APAC, which delivered a very strong performance this quarter. Net revenue amounted to SEK 537 million, representing a solid organic growth of 6.6%. This was primarily driven by the continued strong performance of our Jawaker and Board franchises.

In addition, we see the structural effects of transferring the word franchise from North America to this region, which has increased the total revenue base. User acquisition landed at SEK 40 million, corresponding to 8% of net revenue. This is slightly higher than last year where we're at 5%, and which is natural given the inclusion of the Word franchise as that portfolio carries a structurally higher UAC level.

So the combination of organic growth and cost control has resulted in the high profitability. Adjusted EBITDAC grew to SEK 288 million. This delivers an impressive margin of 54%, an increase from the 51% of last year. And now I'm going to hand over to Emily for the financials.

Thank you, Alexis, and good morning, everyone. It's really great to be here finally. Okay. Let's talk through the group financial results for the fourth quarter. We reported net revenues of SEK 1.356 billion for the quarter, representing an organic revenue decline of 9% year-over-year.

While revenues were down, our strategic focus on our direct-to-consumer channel has been yielding results and our gross margin increased by 3 percentage points year-on-year, reaching a strong 83%. DTC revenue now accounts for 45% of bookings, which is a proper step-up from the 34% we had in Q4 last year. And this is strengthening not just our margins, but also our direct engagement with our player base.

User acquisition spend for the quarter was SEK 356 million, down from SEK 504 million a year ago. And as a percentage of revenue, UA spend was 26% in this quarter, down from 30% in Q4 of 2024. And this shift was primarily driven by our North American business area, as Alexis just mentioned, where we have refined our strategy to prioritize long-term profitability over low-margin revenue.

Moving on to profitability. Adjusted EBITDAC was SEK 368 million in the fourth quarter compared to SEK 410 million last year. And as noted in the report, you will have seen that the adjusted EBITDAC decline was driven by FX headwinds of approximately SEK 45 million explaining that shift.

Despite the decrease in revenue, our adjusted EBITDAC margin amounted to 27% in the quarter, up from 25% last year. And this margin improvement is a direct result of, firstly, our successful cost savings program, which was concluded in Q3, but also our DTC focus and rollout of that channel and, of course, disciplined approach to user acquisition spend.

Moving on to cash generation. Our free cash flow for the quarter was SEK 290 million, bringing our LTM free cash flow to SEK 922 million. And let's have a closer look at those cash flows.

Overall, in 2025, we had a strong cash generation, allowing us both to deleverage and fund our earn-out obligations as well as to self-fund the investments that we're making into the business.

In the quarter, cash flow from operations were SEK 440 million, which included a positive working capital movement of SEK 62 million, primarily driven by phasing of payments for user acquisition spend towards the end of the quarter.

Cash flow from investing activities was SEK 122 million, and this primarily reflects our continued investment in product development, of course, which was slightly offset by the divestment, Alexis mentioned, of our narrative portfolio amounting to USD 4 million, USD 2.5 million of which was settled in 2025.

Cash flow from financing activities of SEK 371 million in the quarter were mainly driven by first debt repayments of SEK 234 million, but also share buybacks of a total of SEK 146 million in the quarter, in line with the share repurchase program we announced in conjunction with the Q3 report.

On an LTM basis, we generated a robust SEK 922 million in free cash flow for the full year 2025. And if we break that down, SEK 583 million of that went towards earn-out cash payments in the year, minority buyouts and the divestment of the narrative portfolio. SEK 273 million was directed towards deleveraging. And additionally, we completed a total of SEK 248 million in share repurchases over the full year.

Now you will have seen no doubt that we did take a noncash goodwill impairment in the quarter. And this follows our annual impairment test, which did result in an impairment totaling just under SEK 2.3 billion related to goodwill write-downs in business area Europe and other acquisition-related intangible assets in business area North America.

Turning now to our financial position. We ended the fourth quarter with a total net debt of SEK 5 billion, which is a significant SEK 1.1 billion reduction from the SEK 6.1 billion in total net debt we had in the prior year. This, of course, reflects our commitment throughout 2025 to settle our earn-out obligations and to deleverage the balance sheet.

In terms of our net debt, including next 12 months cash earn-outs, it decreased from SEK 4.7 billion in Q4 of 2024 to SEK 4.2 billion in Q4 of 2025. And even with this decline that we've seen in the full year reported EBITDAC, we did achieve a decrease in our leverage ratio, which was 2.02x EBITDAC in Q4 of 2025, down from 2.1x EBITDAC in Q4 of 2024.

And looking at our maturity profile in the center of this slide, you will note that we have no material debt maturities until 2027. So with that being said, I would like to hand back to you, Alexis.

Thanks, Emily. You will have seen that we today also announced a change to our segment reporting structure effective from the first quarter of 2026. During this year, we have made progress in focusing our North American business by transferring and closing games where it made sense.

We have divested our narrative portfolio, as we've already said. And so following these developments and in line with our strategy to focus on our key franchises, we have aligned our reporting structure to reflect this.

Going forward, we will move from geographical segments reporting to consolidated group reporting. This will be complemented by a set of clearly defined alternative performance measures to provide greater transparency into the performance and development of our key franchises, which are really the important part here. We have started by including our key franchise revenue data in the financial data pack that is reported alongside the Q4 report, and I would encourage you to have a look at those.

Our key franchises will have the following: more than SEK 200 million of annual revenue and the consistency of core experience, a clear product pipeline and long-term growth potential, a common base of technology and game mechanics and recognizable and scalable IP. For our other games that do not fall within the key franchise grouping, we'll be focusing on product and operating efficiency to yield healthy cash flows to the group.

As a business, we step into 2026 more focused, continuing the work of making incremental improvements to our operations. We'll be increasing our focus and reporting transparency related to our key franchises. We will continue to assess the performance of our games portfolio and we'll undertake measures, including sunsetting games where necessary. We will continue to make disciplined investment decisions and delivering healthy cash flows.

In parallel, with our focus on day-to-day operations, the strategic review initiated in April of 2025 continues and the divestment of our narrative portfolio will improve our organic growth profile and allow us to redeploy resources towards higher potential projects. I appreciate the patience and trust that shareholders have shown during this process.

On the final note, I want to thank the Stillfront team for the dedication and resilience they have shown during a year which has seen significant change. I am looking forward to 2026, and we'll approach it both with continued discipline and ambition. And now I suggest we open it for questions. Thank you very much.

[Operator Instructions] The next question comes from Nick Dempsey from Barclays.

So just in terms of your commentary for 2026, so can we assume that you are aiming for an improved rate of organic revenue -- organic net revenue growth, in other words, less of a decline. Is that what you're shooting for in '26?

And in terms of your commentary on investments, can I try and understand -- can I try and understand what that could imply for EBITDAC margins, whether we're talking about those going down or stable or up or whatever you can say about that to make that a little bit more precise? And then just a final thing. In terms of the other games, we're looking at the key franchises and then we have other games. how much of that is some of the U.S. franchises that we know have been challenged for multiple years versus how much of it is some other areas where there's perhaps a bit more hope.

Emily, why don't you start with the organic growth and invest may be back and I can talk about the other games and core.

Absolutely. Let's do that. And I think you're right, Nick, to note that we've had a year of varied trading performance. We've had double-digit organic decline in 2025, 9 percentage points organic revenue decline in Q4. And we're, of course, aiming to take the business back to organic growth over time.

You will have noted our notes around making incremental improvements to the business holistically to continue on that path. Of course, different quarters can have variations, and we will not give sort of a quarter-by-quarter forecast, but the holistic ambition is, of course, to get back to organic growth over time by doing incremental improvements.

When it comes to the EBITDAC margins, looking at those on a quarter-by-quarter basis is sometimes misguided, for example, when you have a quarter where you have the opportunity to deploy more UA spend, capturing opportunities to drive future organic growth. So whilst our margin might fluctuate quarter-by-quarter, we are holistically aiming to make disciplined investments to support us on this path back towards organic growth.

Do you want to answer on the EBITDAC as well, I mean?

Yes. When it comes to EBITDAC, I think our general comments there are that we will make disciplined investments to support this business back to organic growth. We're not going to guide on EBITDAC margin quarter-by-quarter.

But for example, we've seen early positive signs from our big franchise Big Farm Homestead launch and where we see opportunities to deploy UAC in a disciplined and way that meets the robust criteria for those campaigns, we will deploy that to support the growth ambitions for the company.

I think to build on what Emily has said, really, if you look at 2025, 2025 has been a turnaround year. We've really been focusing on setting the business straight with the right priorities back to a healthy level is difficult for North America, but also making some of the required things that we have to do for -- in Europe. Of course, we've got EMEA and APAC that is continuing being very strong.

What we're seeing is 2026 is really going to be kind of more of an investment year. We're seeing, as I said, encouraging signs with new game launches such as Big Farm in Europe. And that's something that we will see what kind of UA we can deploy around that, but there are some. But again, as Emily said, the objective is over time to return to organic growth.

In terms of your question for the other games, and if most of that is the U.S. franchises. Actually, there's -- one of the U.S. franchises, Bitlife is one of our key franchises. We have a clear path in terms of how that franchise can grow. We're seeing -- we saw a good update to that franchise by putting a full accounting system that allows us to do a lot more live operations that we're not able to do with Bitlife. And we've also had a successful Vampire update, which is something that the comm really, really wanted to see. So that's been working.

But we do have in other franchises, the Home Design Makeover franchise. where we've actually done a complete change of the economy, and we are seeing some improvements, but we still want to see more work being done there, and we want to see a bit more KPIs before we decide if that's a franchise that is -- that we should basically be investing more in or not. So we're being very, very focused and very disciplined about what we consider a key franchise and what we consider something that is not a key franchise.

The next question comes from Rasmus Engberg from Kepler.

I was just wondering with regards to the cash flow, how do you see that being able to maintain roughly the current levels? Or what's the ambition for the current year?

Do you want to take that?

I love cash. I'll be delighted to take that question. We are, of course, aiming to maintain very healthy cash flows within the business. This has been one of our core strengths. When it comes to our core KPIs, we have not only market-leading EBITDAC margins, but we also have strong cash conversion from that baseline, and we have consistently delivered very healthy cash flows. And we, of course, want to continue to be a business that has strong healthy cash flows moving forward.

You will have seen that in 2026, we have no debt maturity. We do have an earn-out obligation that we're due to settle. You will have seen that in our report. And the final earn-out obligation comes in 2027.

So with no debt maturity in 2026, we are hoping to be able to utilize our free cash flows in an efficient way, both for earn-out obligations for deleveraging and to continue to fund the investments into the business that set us back to organic growth over time. So maintained healthy cash flows.

Right. And with your new reporting structure, how do you sort of think about that in 2026? Is it continued like single-digit organic growth in the core franchises and continued big decline in the rest of the business? Or how do you sort of -- how do you think about that?

Yes. I think I'll start and then Emily, maybe you can build on that. We're looking at these key franchises, and we're seeing that we have the -- basically the density in terms of the team, the talent density to really kind of make them work and really be winners in the market. So we think that these key franchises are franchises that we can grow not only for the short term but over the long term. So that's what we're seeing.

What we're seeing that is not in the core franchises are basically games that we feel are more about either optimizing for cash flows or potentially we'll also have some experiments in there. So that kind of allows us to really organize better how we're doing things.

Also, a lot of the questions that we kept having was like what are the kind of the core -- how are the core franchises performing, how are the core games performing at Stillfront. And we think this is -- with this reporting, we're really giving you that transparency so you can understand how Jawaker is performing. You can understand how the Board franchise is performing. You can understand how the Supremacy franchise is performing year-on-year and quarter-on-quarter. And I think that will allow you to much better understand the business, and it also is a much closer and much more kind of accurate description of how we're actually running this games company. Emily, do you want to build on that?

I think that's comprehensive. Nothing further to...

So it looks -- I mean, we have very little history here, but it seems that what we're seeing is a maintained UA spend in terms of relative to revenues in the core franchises and then a decline or a low level in the other games. Is that sort of what we could expect going forward as well.

That's a correct reflection of the numbers that we just posted this morning. And with Alexis' guidance on the focus on our key franchises, key investments, not just in product development, but deploying UA spend towards those key franchises as well. That is our strategy.

And the question that many investors think about the strategic review, should we see that as now clearly indicating that it's not among the key franchises that we should expect a deal? Or is it disconnected from that?

So basically, as I've said before, so we -- the strategic review is still ongoing. The latest development of review has obviously been the sale of the narrative games, which were holding back our organic growth.

But as I said before, we still consider that we should have everything on the table that we believe can create shareholder value in the best way, but we've been quite disciplined in making sure that we're focusing on selling first the things that we think are holding us back.

[Operator Instructions] There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you very much for your questions, and thank you for joining the Q4 Stillfront report, and have a great day. Thank you. Bye-bye.

Good morning, and welcome to the Stillfront Q3 presentation. I am Alexis Bonte, the CEO of Stillfront, and I will be joined later by Tim Holland, our Interim CFO.

I would like to start with a slight focus on Europe. As you can see, we had solid progress in Europe. We said a few quarters ago that we were in an investment phase in Europe in the first half of the year and that we would start reaping some of those rewards towards the later part of the year.

As you can see, Europe returned to growth for the first time since Q1 of 2024, so in Q3, where the growth was just under 1%. What is important to say here, this is before the launch of the main new games that will happen in Q4. Those big new games, as a reminder, will be Big Farm: Homestead, that will launch towards the end of the year and will be within the Big franchise, and we'll build on the success that we had with Sunshine Island. Another big game that we announced previously that will launch in Q4 is Warhammer 40,000, which is a big important new launch on the Supremacy franchise with a major IP. And we also soft launched with a narrative franchise, the Unfolded: Webtoon Stories game with the Webtoon IP, and that soft launch is having some encouraging results.

The marketing efforts also that we'll have in what we call Q5, which is right after Christmas. It's a good time to basically start scaling game. We'll see most of that revenue come into next year. Obviously, and that will impact the margins in Europe in Q4. But I just want to show that we say that we were going to basically really work on building up Europe in the first part of the year. And so I'm very happy to see that, and to be able to share that we are now reaping some of the results with the existing franchises, which are kind of showing the results in terms of live operations and how that is really performing. And also obviously excited about the new launches in our core business area of Europe.

If we go into the KPIs that we have in Europe, so that resulted in a net revenue of SEK 643 million. That's up 0.6% year-on-year. UAC was at SEK 207 million, relatively stable. We were able to apply quite a lot of UA, especially in Supremacy at the beginning of the quarter. Then towards the end of the quarter, it was a bit harder to put more UA. But overall, I think we're with a healthy level in UA for Europe. And as you know, every quarter, it varies a lot whether we're able to place UA or not place UA. So that's something that we're always very, very attentive to.

Adjusted EBITDAC was solid at SEK 154 million, which is a margin of 24%. Our key franchises in Europe grew by 0.4%, good performance. I was very happy, in particular, with Albion Online, who started doing a lot of investments in product marketing. I told you that I wanted the company to be less dependent on performance marketing and Albion Online's is a great game to be doing more product marketing and they had a really strong effort in product marketing, which actually has borne fruit and has been successful, and that gives me a lot of confidence for that franchise going forward.

The smaller franchises actually grew faster in Europe. That was mostly due to -- from our Playa studio, a smaller franchise called Shakes & Fidget, which performed well year-on-year, and also had a small new launch called Mobile Dungeon, which helped that franchise scale a little bit. So that's Europe, very happy with the results in Europe.

Continuing on to North America, as you know, and as we said from the beginning, North America has been our turnaround case. It's been really our problem side. It's the only business area that has negative growth. It is the business area that's actually dragging us down overall in terms of organic growth. Without North America, we would have very healthy growth across the group since both Europe and MENA and APAC are growing business areas.

But that being said, we're continuing our turnaround efforts in North America, and we're -- and we are deliberately focusing on profitability. That's really what we want to do. We want to find the right level. We've made some very serious cost cutting in North America. I think we have a much healthier base now in that area. We also took some very hard decisions moving games to other business areas. And I would say that a lot of that work is done now.

We ended up with basically SEK 246 million of revenues. That's 32.9% down year-on-year. So that's what is dragging down the organic growth. UAC was SEK 110 million. As I said before, we are extremely disciplined about UAC and what games it goes to, and we've really increased the discipline in North America around that. And that obviously has an impact on the net revenue profile of the business area. But then it also resulted in a large increase in our adjusted EBITDAC, which was SEK 36 million, which is a 15% margin. I think most of you will recall that North America was barely profitable a few quarters ago. And that obviously is a big change that now North America is a net positive contributor to our EBITDAC margin. And I think this is just a much more healthy base to work from.

Both key franchises and other franchises were down in North America. Now the challenge for North America is going to be to work from that base. I do expect the decline to continue into Q4 as we're continuing with our discipline, but I do also expect North America to continue to be a net positive contributor in terms of EBITDAC as we work on improving things there.

MENA and APAC, continued solid growth. Actually, growth has slightly increased quarter-on-quarter. Very happy with MENA and APAC. We have -- if you look at our key franchises, they grew by more than 18%. That's -- and going into even more detail, both Jawaker and the Board Ludo franchise from Moonfrog had very healthy double-digit growth. Very, very solid situation in MENA and APAC. Small level of UAC. There's very little dependency on UAC, EMEA and APAC. I think actually, we do have an opportunity there to boost a little bit the growth in the future and more likely in 2026, particularly for the Board franchise if we're able to place a bit more UAC there, but that's something that we're going to do carefully and slowly, and just basically the -- and with discipline as we've been very disciplined all the time. And adjusted EBITDAC as a result has continued to increase significantly with SEK 276 million, which is a 57% margin. So that's basically the main things on this side.

I will now pass on to our interim CFO, Tim, for -- to talk a little bit about finance.

Thank you, Alexis, and good morning, everyone. On a group level, revenues declined by 7.8% organically, coupled with a 6% foreign exchange headwind. Our net revenue declined from SEK 1,595 million, down to SEK 1,373 million. And that was driven by a few different things, but primarily, it was driven by BA North America and specifically Word and HGM franchises. And as Alexis noted, we are much more focused on the profitability of those titles. So we did decrease user acquisition on a year-over-year basis. However, when you do decrease UA, that's obviously going to increase profitability, but it is going to decrease net revenue.

But that was partly offset by strong performance in BA Europe. As Alexis noted, we're almost at 1 percentage point of organic growth for BA Europe, and that was driven by strong performance for Big, for Albion Online and for Supremacy as well. And we also had strong performance from BA MENA APAC, where we got to almost 3 percentage points of organic growth, and that was driven again by Jawaker and Board franchises.

Looking at UAC. UAC came down year-over-year from SEK 462 million down to SEK 336 million, and that was driven primarily by year-over-year declines in UA spend for HGM and for Word. Looking at adjusted EBITDAC, that's up year-over-year from SEK 385 million up to SEK 436 million. I should note that's a 13% point increase on an absolute basis year-over-year, and our net revenue obviously declined by 14%, but we are showing strong margin resilience even with that net revenue decline.

Adjusted EBITDA came in at 32% in terms of margin. Again, that's up 8 percentage points compared to Q3 of 2024. Again, that's primarily driven by decreased UAC as a percentage of net revenue. But one thing to point out as well is that our gross margin has improved on a year-over-year basis from 80 to 83 percentage points, and that's due to the continued success of our Web shop rollout, where we've improved our direct-to-consumer share of revenue year-over-year from 33% up to 44 percentage points in Q3 of 2025.

Looking at our LTM free cash flow, that's down slightly year-over-year. Last time we spoke, we reported SEK 1,089 million in terms of LTM free cash flow. That's down to SEK 974 million, but that change is primarily related to working capital adjustments, which is a natural part of our business. So you are going to see that fluctuation from positive to negative in terms of our working capital adjustments.

Next slide, please. Digging a bit further into our cash flow generation. Cash flow before changes in net working capital came in at SEK 357 million, of which is SEK 77 million in paid financial expenses. That is down year-over-year from SEK 101 million, down to SEK 77 million. The decrease that you're seeing there is due to two things. That's primarily due to a reduced interest rate environment, and then also a reduction in our interest-bearing debt. Of that cash flow from operations before changes in net working capital, there is taxes paid of SEK 90 million. That's up year-over-year from SEK 42 million, up to SEK 90 million. The reason for the increase is primarily due to Jawaker, where we're paying taxes for Jawaker in the UAE now under that new legislation where you have to pay 9% of your corporate tax -- taxable income there. I should note that we are under CFC taxation in Sweden, so we will be getting a credit back for that amount. So the SEK 42 million to SEK 50 million amount is more of a normalized basis for our taxes paid.

Net working capital came in at SEK 47 million, negative SEK 47 million, and that is due to negative SEK 98 million in terms of liabilities. That negative movement for liabilities is due to a reduction in our UAC, but that was partly offset by a positive impact of SEK 51 million for our receivables, and that's primarily due to reduced net revenue.

Looking at cash flow from investment activities, that came in at SEK 119 million, and that was primarily driven by SEK 116 million in terms of product development. I should note that, that's about 8.5% of our net revenue spent on product development. Last year, it was 9.4%. So we are spending less in terms of product development. However, we are taking a much more targeted approach in terms of product development by specifically spending more in Europe, spending more in MENA and APAC. We were spending less in terms of BA North America.

Looking at our cash flow from financing activities that came in at SEK 326 million. That was primarily driven by SEK 335 million that was used to pay down our RCF. That's up year-over-year, and that shows our continued focus on deleveraging this business.

Turning now to our free cash flow. You can see our free cash flow for the LTM basis was SEK 974 million. That is up year-over-year from SEK 835 million. And the difference between the two values primarily comes from reduced financing charges, reduced product development, and it's partly offset by taxes paid.

And this table on the right primarily shows what we've done with that free cash flow. So we had, obviously, the cash portion of our earn-outs at SEK 618 million. And we also reduced our borrowings by SEK 268 million. Again, that's up year-over-year. And then we had our share buybacks for SEK 142 million over an LTM basis. And I will note, and as you probably saw from the press release this morning, we have announced a new program that will begin tomorrow.

Next slide, please. Looking at our financial position, our financial position, total net debt decreased from SEK 5.9 billion last year in Q3 of 2024, all the way down to SEK 5.1 billion. That's a reduction of almost SEK 800 million, again, showing our focus on deleveraging this business. The middle table shows our maturity profile. The maturity profile remains strong. As you know, we don't have any major maturities until 2027. That large bar there of SEK 2.9 billion represents SEK 1 billion for a bond that's due in 2027, the RCF drawn of SEK 1.2 billion and SEK 0.7 billion in terms of our SEK term loan. Then we have a bond due in 2028, and a bond due in 2029.

Looking at the right table, that's our net debt to EBITDA. We came in at 2.06x for our leverage ratio. That's obviously above where we want to be for our 2x leverage ratio target. However, we are down sequentially from Q2 2025. We are down from 2.18, down to 2.06. And then on a year-over-year basis, we're down from 2.08 to 2.06. I should note, excluding earn-outs, we are at 1.87x. And then we'll flip to the next slide here.

Then this is the last slide before I'll pass it back to Alexis. But as we've noted in our report this morning, we are announcing the conclusion of our cost optimization program, which has been driven by fixed cost savings and direct cost savings. And this has been announced 1 quarter early. We view this program as being a fantastic success. As I noted, we saved a significant amount of costs, specifically with fixed cost in North America, and we've been very successful with our direct cost savings with the rollout of the Web shop, improving our gross margin. Going forward, we're, of course, going to continue to focus on cost savings and direct cost improvements. However, we want to take a balanced approach to invest in our key franchises and invest in the future of Stillfront.

And with that, I'll hand it back to Alexis. Thank you.

Thank you, Tim. So basically, to conclude, we are starting to deliver on what we set ourselves to deliver a year ago. We have concluded the cost optimization program a quarter in advance at the maximum level that we had set. We are advancing very decisively with the turnaround in North America and making sure that it's got a healthier base and healthier profitability. We are returning Europe to a more healthy level of organic growth while still having solid margins, and a very interesting pipeline of new games coming in. And we have MENA and APAC that is continuing to go from strength to strength. And we're also leveraging some of the talent there to move some of the games that we had in North America into that region.

So we are still very much at the beginning of what we would like to deliver, but we are definitely seeing the first signs that our strategy is working, which gives me a lot of confidence, but also makes me extremely thankful to all the teams at Stillfront.

In terms of our key focus going forward, we're going to continue to focus relentlessly our investments on the key franchises. That is something that we will do more and more and more. We obviously -- we're a games company. So we will continue focusing on successfully launching new games. But as you can see from our CapEx with a lot more disciplined approach, but at the same time, I want to make sure that we have the right level of ambition. We will continue to -- with our discipline of delivering on strong margins and cash flow. And obviously, we are continuing to execute on the strategic review. You've seen that we've done some game closures this past quarter. We've also announced that we'll likely do some extra game closures, and we're also looking at, still, very carefully at some potential divestments.

So with that, I think we are ready to take your questions, and thank you very much for your attention.

[Operator Instructions] The next question comes from Erik Larsson from SEB.

I have two questions. First off, I appreciate the outlook comments here on Q4. And as I understand it, your wording on Europe as we will potentially see weaker organic growth rates in Q4 versus what we saw here in Q3. But are you still confident on the ability to grow sequentially here, just to sort of get a feeling on the magnitude?

Yes. Maybe I can take that question first, and then Tim, you can build up. So yes, as we've indicated, we do believe that Europe might potentially be a little weaker in Q4, but still, it will be a completely different level to what you saw in Q1 and Q2.

The reason why it's very difficult for us to really know where Europe will be is a lot of it depends on the year that we're able to allocate for Supremacy. And also most of the impact of the new games will be in the later part of the year and also towards next year, and it's very difficult to basically balance what will happen there. But it's definitely on another level going forward, and we're very confident that we've kind of found a new rhythm for Europe now.

Tim, I don't know if you want to...

Yes. I mean, just as Alexis said, there's going to be variability from quarter-to-quarter, but we do believe in the long-term improvement in Europe. And then as Alexis mentioned as well, that's going to be heavily influenced by the new games.

Okay. Then second and final question. Looking at your debt structure, it's start to look at some refinancing next year. So I just wanted to hear some thoughts how you think about the capital allocation. I guess you have reducing the absolute debt, giving better earn-outs, et cetera. So any thoughts there would be interesting to hear?

Yes. I mean we're going to get back to that. I think that our debt structure is strong. We have our maturity profile. Everything is primarily due in 2027 onwards. And that's a good timing as well because our earn-outs will be finalized in 2027 as well. So what we'll do with the extra cash could be amortizing much more on our RCF. We can also potentially do dividends. We could do acquisitions, but we'll get back to that at the appropriate time.

[Operator Instructions] The next question comes from Rasmus Engberg from Kepler Cheuvreux.

Warhammer Supremacy, when is that the game supposed to be out?

Rasmus, good to hear from you. So basically, we are having an initial launch, I think, around the end of this month, which will be a soft launch. And then we expect to basically scale the launch during the year to have, basically, a larger launch towards the end of the year. So Q4, but later part of Q4.

Okay. And would you dare to say anything about Europe for next year? Do you think it's going to be largely stable then? Or you've taken some measures with launches and improvement of titles? Is Europe stable from these levels going forward? Or how do you think about it?

Yes. I mean the way we're thinking about it is we did a lot of work that was necessary to be done in Europe. We're really focusing our investments, focusing on the key franchises, making sure that we have a proper pipeline going forward. We're seeing the results, I think, basically more or less when we expected them, which is good. And that gives me very solid confidence for next year.

And these new measures, you talked about closing some further games in North America, or potentially lowering them. That sounds like though there are more fixed cost savings sort of outside of the program? Or how should we think about that? Or is that going to be reinvested in something or?

Yes. I think there's a time to be doing cost savings and there's a time to go on the offensive. I think we've done what we had to do in terms of cost savings. And any further savings that we might receive from other game closures and all that, it is very much our intention to reinvest and to go on the offensive and to strengthen our pipeline. I think we have a strong base to do that. I think the cleanup that we had to do has mostly been done. And now it's about really being more aggressive going forward.

Would it be possible to talk about sort of the better part of North America? Is that a stable part? How much is it? Is it possible to give any indication on that?

I mean we don't do breakdowns of business areas, obviously. I mean, I'll let Tim to build up. But obviously, we have some key franchise in North America. Those -- some of those key franchises, I think, have really good potential, but they need to increase their performance. I think we we've really raised the bar in terms of what we consider as good performance. I think there is a few franchise in North America that could do well. Some can do well within North America. Others, clearly, we didn't have the team or the right resources to make them work in North America. For example, like Word. And that's why we moved out Word games to Moonfrog in India, where the team there, a lot of people are former Zynga people that worked actually on Word games. So it was a perfect match.

So we'll be kind of very direct with that. But yes, there are some good elements in North America, but they're going to have to demonstrate over the next 3 to 6 months that they can deliver basically.

Yes, nothing further to add other than we have some very strong franchises in North America. Like BitLife, there's probably nothing like it globally in terms of that title. And so we have high hopes for that title. But of course, we do need to see some stronger performance in that region.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Well, on behalf of Tim and myself, thank you very much for joining this call on the Q3 Stillfront results. As I just said, we're executing on what we said we were going to do. And we are happy to start seeing the first results of our strategy. And obviously, we aim to continue to deliver over this over the next quarters. Thank you very much for your time.

Thank you.