Frontier Developments (FDEV) AI Stock Analysis

• Market Cap: £152.06M
• Dividend Yield: N/A
• Average Volume (3M): 160.85K
• Price to Earnings (P/E): 8.0
• Beta (1Y): 1.19
• Revenue Growth: 1.49%
• EPS Growth: N/A
• Country: UK
• Employees: 700
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 0.20
• Shares Outstanding: 36,960,007
• 10 Day Avg. Volume: 121,822
• 30 Day Avg. Volume: 160,846
• PEG Ratio: -0.03
• Price to Book (P/B): 1.01
• Price to Sales (P/S): 1.06
• P/FCF Ratio: 2.29
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £602.50
• Price Target Upside: 24.48% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 74 Outperform
• Price Target: 471.00p ▼(-2.69% Downside)

The score is driven primarily by improving financial performance and cash-flow strength alongside a solid balance sheet, with a strong uptrend in the stock price providing additional support. Valuation also contributes positively due to the low P/E, while the main offsetting risk is the significant decline in gross margin.

Positive Factors

Cash Generation

Frontier converts earnings into cash efficiently, with operating cash flow well above net income and near-1x FCF-to-income conversion. Durable cash conversion supports ongoing game development, live-ops funding, and reduces reliance on external financing over the next several quarters.

Balance Sheet Strength

Low leverage and a high equity base provide financial flexibility and resilience. A conservative balance sheet lets Frontier fund sequels, invest in live-service content, or absorb uneven game cycles without jeopardizing operations or needing frequent capital raises.

Recurring Monetisation Model

Frontier’s business relies on base-game sales plus post-launch monetisation (DLC, expansions, in-game purchases) and publishing revenue. This model extends revenue life per title, increases lifetime value, and supports predictable multi-year cash flows when live-ops perform as planned.

Negative Factors

Gross Margin Compression

A large decline in gross margin signals rising direct costs or lower-priced revenue mix. If structural, this compresses operating leverage and limits the impact of future revenue growth on profits, raising the bar for sustaining prior profitability levels over months.

Weak Top-line Growth

Modest revenue growth after prior declines suggests limited organic expansion or reliance on a few titles. Slower top-line momentum constrains scale benefits from fixed-cost absorption and puts more pressure on margins and investment choices over a multi-quarter horizon.

Concentration / Hit-driven Risk

Reliance on a small portfolio of premium and live-service titles makes revenue and cash volatile if new content underperforms. Over 2–6 months, a late or weak DLC/expansion cadence or an underwhelming launch can materially affect recurring revenues and margin recovery.

Frontier Developments Business Overview & Revenue Model

Company Description

Frontier Developments plc develops and publishes video games for personal computers and videogame consoles in the United Kingdom. The company develops games across various platforms using its cross-platform technology, Cobra. It also publishes games developed by selected partner studios under its Frontier Foundry games label. The company was incorporated in 1994 and is headquartered in Cambridge, the United Kingdom.

How the Company Makes Money

Frontier Developments generates revenue through multiple streams, including game sales, downloadable content (DLC), and microtransactions. The majority of its income comes from sales of its games on various platforms, including PC and consoles. Additionally, the company monetizes its titles through the release of DLC, which enhances the gaming experience and encourages further purchases from existing players. Microtransactions also contribute to revenue, particularly in games that offer cosmetic items or additional content. Frontier has established partnerships with major gaming platforms and publishers, which help in distributing its games and expanding its reach in the market. Furthermore, the company benefits from a loyal fan base that supports its ongoing development efforts, further solidifying its financial performance.

Frontier Developments Financial Statement Overview

Summary

Financials show improving profitability and strong cash generation. Net margin turned positive to 18.09% and EBIT/EBITDA margins improved, while cash conversion is strong (operating cash flow to net income 2.83; free cash flow to net income 0.99). Balance sheet is stable with low leverage (debt-to-equity 0.20) and a high equity ratio (72.81%), though the sharp gross margin decline (68.69% to 44.05%) is a key risk.

Income Statement

Frontier Developments has shown a mixed performance in its income statement. The company experienced a slight revenue growth of 1.93% in the latest year, recovering from previous declines. Gross profit margin decreased significantly from 68.69% to 44.05%, indicating increased cost pressures. However, the net profit margin improved to 18.09% from a negative position, reflecting better cost management and profitability. EBIT and EBITDA margins also improved, suggesting operational efficiency gains.

Balance Sheet

The balance sheet of Frontier Developments is relatively stable. The debt-to-equity ratio decreased to 0.20, indicating a conservative leverage position. Return on equity improved to 17.22%, showing effective use of equity to generate profits. The equity ratio stands at 72.81%, reflecting a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Cash flow metrics indicate a positive trend for Frontier Developments. Free cash flow growth was 2.90%, and the operating cash flow to net income ratio is robust at 2.83, suggesting strong cash generation relative to earnings. The free cash flow to net income ratio of 0.99 indicates efficient conversion of earnings into cash.

Breakdown	TTM	May 2024	May 2023	May 2022	May 2021	May 2020
Income Statement
Total Revenue	102.94M	90.60M	89.27M	104.58M	114.03M	90.69M
Gross Profit	45.02M	39.91M	61.32M	67.34M	73.61M	63.15M
EBITDA	40.78M	36.89M	9.88M	14.86M	33.73M	38.08M
Net Income	20.00M	16.39M	-21.47M	-20.91M	9.63M	21.56M
Balance Sheet
Total Assets	136.59M	130.69M	117.39M	141.01M	169.58M	161.52M
Cash, Cash Equivalents and Short-Term Investments	40.11M	42.50M	29.52M	28.31M	38.70M	42.42M
Total Debt	18.56M	19.47M	21.28M	19.28M	20.74M	22.16M
Total Liabilities	42.42M	35.53M	40.56M	45.04M	51.21M	48.37M
Stockholders Equity	94.17M	95.16M	76.82M	95.97M	118.37M	113.15M
Cash Flow
Free Cash Flow	50.13M	41.97M	31.50M	4.49M	2.41M	6.08M
Operating Cash Flow	50.40M	42.31M	32.46M	47.88M	41.16M	38.95M
Investing Cash Flow	-24.68M	-26.71M	-28.70M	-52.31M	-38.69M	-32.83M
Financing Cash Flow	-12.85M	-2.64M	-2.51M	-6.02M	-6.17M	-9.47M

Frontier Developments Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 484.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:FDEV, the sentiment is Negative. The current price of 484 is above the 20-day moving average (MA) of 463.15, above the 50-day MA of 471.46, and above the 200-day MA of 402.71, indicating a neutral trend. The MACD of -13.87 indicates Positive momentum. The RSI at 33.81 is Neutral, neither overbought nor oversold. The STOCH value of 9.03 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:FDEV.

Frontier Developments Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GMR	74 Outperform	£93.06M	11.76	24.79%	―	21.27%	21.93%
FDEV	74 Outperform	£152.06M	8.02	19.06%	―	1.49%	―
EVPL	68 Neutral	£429.37M	19.68	8.06%	1.12%	-6.90%	―
DEVO	62 Neutral	£121.25M	-12.26	-8.33%	―	-10.51%	-63.78%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
TBLD	50 Neutral	£29.00M	-3.32	-22.74%	―	-20.54%	86.22%
GFIN	43 Neutral	£1.59M	-1.50	-169.50%	―	-54.59%	―

Frontier Developments Corporate Events

Frontier Developments Awards Performance-Linked Share Options to Executive Directors

Frontier Developments plc, the AIM-listed Cambridge-based video game developer and publisher, has awarded 185,000 share options to three executive directors under its existing Long Term Incentive Plan. The options, granted at the nominal exercise price of 0.5p per ordinary share, are scheduled to vest in 2029 subject to performance conditions.

Half of the awards depend on achieving threshold targets for revenue, profit and shareholder returns over a three-year period, with the remainder tied to stretch targets on the same metrics. The grants materially increase long-term equity incentives for CEO Jo Cooke, President and Founder David Braben and CFO Alex Bevis, signalling an effort to align top management more closely with shareholder value creation and Frontier’s financial performance trajectory.

The most recent analyst rating on (GB:FDEV) stock is a Buy with a £502.00 price target. To see the full list of analyst forecasts on Frontier Developments stock, see the GB:FDEV Stock Forecast page.

Frontier Developments Upgrades Outlook After Strong H1 Driven by Jurassic World Evolution 3

Frontier Developments reported a strong first half for the 2026 financial year, with revenue up 26% to £59.6m and adjusted operating profit rising 76% to £9.7m, driven primarily by the successful launch of Jurassic World Evolution 3 and robust performance across its CMS portfolio. CMS titles accounted for 90% of H1 revenue, with Jurassic World Evolution 3 achieving record-breaking December sales and award nominations, while Planet Zoo became the company’s highest-grossing individual game and Planet Coaster continued to outperform expectations, underpinning a pipeline that includes a Planet Zoo sequel in FY27 and an unannounced CMS title in FY28. The strength of trading, including Frontier’s second-highest December revenue ever, prompted an upgrade to full-year guidance to around £100m in revenue and £11m in adjusted operating profit, reinforcing the company’s turnaround to sustainable growth. The period also marked a planned leadership transition, with former CMO Jo Cooke taking over as CEO from Jonny Watts, who remains on the board to ensure continuity as Frontier doubles down on its CMS-focused strategy and content roadmap.

The most recent analyst rating on (GB:FDEV) stock is a Buy with a £586.00 price target. To see the full list of analyst forecasts on Frontier Developments stock, see the GB:FDEV Stock Forecast page.

Frontier Developments Lifts Guidance After Strong H1 on Jurassic World Evolution 3 Success

Frontier Developments reported a strong first half for FY26, with revenue up 26% year-on-year to £59.6m and adjusted operating profit rising 76% to £9.7m, driven primarily by highly successful launch sales of Jurassic World Evolution 3 and robust performance across its creative management simulation portfolio. The company’s CMS titles contributed 90% of total revenue, with Planet Zoo becoming its highest-grossing game to date and setting the stage for a planned sequel in FY27, while Elite Dangerous also delivered over 50% revenue growth. Strong trading in December, including record Christmas Day sales for Jurassic World Evolution 3, prompted management to upgrade full-year guidance to around £100m in revenue and £11m in adjusted operating profit, underlining a return to consistent profitability. Alongside the financial momentum, Frontier announced a smooth leadership transition as former CMO Jo Cooke took over as CEO from Jonny Watts on 1 January 2026, with Watts remaining on the board to support the handover, and confirmed progress on an unannounced CMS title for FY28 and another unannounced game from its Canadian studio for FY27, reinforcing its pipeline and long-term CMS-focused strategy.

The most recent analyst rating on (GB:FDEV) stock is a Buy with a £586.00 price target. To see the full list of analyst forecasts on Frontier Developments stock, see the GB:FDEV Stock Forecast page.

Frontier Developments Confirms Jo Cooke as New CEO in Planned Leadership Transition

Frontier Developments has appointed Johanna (Jo) Mair Cooke as Chief Executive Officer, with her formal joining of the board effective 1 January 2026, following an earlier announcement in December. Outgoing CEO Jonny Watts will remain on the board until 31 May 2026 to ensure an orderly leadership transition, while Cooke has been granted 25,000 share options under the company’s long-term incentive plan, due to vest in August 2028 without performance conditions, underscoring a planned and stable succession at the top of the UK-listed games developer.

The most recent analyst rating on (GB:FDEV) stock is a Buy with a £586.00 price target. To see the full list of analyst forecasts on Frontier Developments stock, see the GB:FDEV Stock Forecast page.

Frontier Developments Announces CEO Transition and Strong Interim Results

Frontier Developments plc announced a leadership change as CEO Jonny Watts plans to step down for personal reasons, after successfully leading a strategic shift back to the company’s core strength in creative management simulation games. Jo Cooke, currently Chief Marketing Officer, will succeed Watts as CEO, effective January 2026, bringing extensive industry experience to continue driving the company’s growth. The company also announced its interim financial results will be published in January 2026, with expectations of strong performance from its portfolio, including the recently launched Jurassic World Evolution 3.

The most recent analyst rating on (GB:FDEV) stock is a Buy with a £586.00 price target. To see the full list of analyst forecasts on Frontier Developments stock, see the GB:FDEV Stock Forecast page.