Digital Bros S.p.A. (DIB) AI Stock Analysis

• Market Cap: €181.17M
• Dividend Yield: N/A
• Average Volume (3M): 48.35K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.42
• Revenue Growth: -1.36%
• EPS Growth: -91.72%
• Country: IT
• Employees: 286
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 0.32
• Shares Outstanding: 14,265,037
• 10 Day Avg. Volume: 53,299
• 30 Day Avg. Volume: 48,354
• PEG Ratio: -0.05
• Price to Book (P/B): 1.90
• Price to Sales (P/S): 2.31
• P/FCF Ratio: 6.66
• 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: €20.00
• Price Target Upside: 52.21% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: €14.50 ▲(10.35% Upside)

Digital Bros S.p.A. shows strong revenue growth and cash flow generation, which are key strengths. The technical indicators suggest a positive price trend, adding to the stock's attractiveness. However, profitability challenges and a negative P/E ratio weigh down the overall score. Improving profitability will be essential for enhancing the stock's valuation and overall appeal.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for Digital Bros' products and effective market penetration, supporting long-term business expansion.

Cash Flow Generation

Significant free cash flow growth enhances financial flexibility, allowing for reinvestment in growth opportunities and debt reduction.

Balance Sheet Health

A low debt-to-equity ratio suggests financial stability and lower risk, providing a strong foundation for sustainable growth.

Negative Factors

Profitability Challenges

Negative profit margins highlight operational inefficiencies, which can hinder long-term profitability and shareholder value.

Return on Equity

Negative return on equity indicates that the company is not effectively using shareholders' funds to generate profits, impacting investor confidence.

Operational Inefficiencies

Negative EBIT margin points to cost management issues, which could affect the company's ability to achieve sustainable profitability.

Digital Bros S.p.A. Business Overview & Revenue Model

Company Description

Digital Bros S.p.A. develops, publishes, distributes, and markets video games in Europe, the Americas, and internationally. It operates through Premium Games, Free to Play, Italian Distribution, and Other activities segment. The Premium Games segment acquires and distributes video games content rights on digital marketplaces, such as Steam, Sony PlayStation Network, Microsoft Xbox Live, Epic Game Store, etc., as well as through an international sales network; and publishes video games under 505 Games brand name. The Free to Play segment develops and publishes video games and applications that are available free of charge on digital marketplaces under the 505 Games Mobile brand name. The Italian Distribution segment purchases and distributes video games under the Halifax brand; and Yu-Gi-Oh! trading card games through newsstand distribution channel in Italy. The Other Activities segment organizes video game training and professional update courses. Digital Bros S.p.A. was founded in 1989 and is based in Milan, Italy.

How the Company Makes Money

Digital Bros generates revenue through several key streams. Primarily, the company earns money from the sale of video games, both digital and physical, across various platforms. This includes revenues from its proprietary titles and those published from third-party developers. Additionally, Digital Bros monetizes its games through in-game purchases and downloadable content (DLC), which enhance player engagement and drive additional sales. The company also benefits from strategic partnerships with digital distribution platforms, which provide wider access to its games and help increase sales. Furthermore, Digital Bros may engage in licensing agreements and collaborations that can generate additional revenue, particularly in merchandising and adaptations of their gaming properties.

Digital Bros S.p.A. Financial Statement Overview

Summary

Digital Bros S.p.A. faces challenges with declining revenue and profitability, as reflected in the income statement. However, the company maintains a stable balance sheet with a reasonable debt level and strong equity position. The cash flow statement is a bright spot, showing significant growth in free cash flow, which could support future investments and debt repayment. Overall, while there are concerns about revenue and profitability, the company's cash flow and balance sheet provide a foundation for potential recovery.

Income Statement

Digital Bros S.p.A. has experienced a decline in revenue over the past year, with a negative revenue growth rate of -13.77%. The company also reported a negative net income, resulting in a negative net profit margin. However, the EBIT and EBITDA margins remain positive, indicating operational efficiency despite the revenue decline. The gross profit margin has decreased compared to previous years, reflecting challenges in maintaining profitability.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio, indicating a balanced approach to leveraging. However, the return on equity is negative, reflecting the company's recent net losses. The equity ratio is strong, suggesting a solid capital structure with a significant portion of assets financed by equity.

Cash Flow

The cash flow statement reveals a strong free cash flow growth rate of 41.18%, indicating improved cash generation capabilities. The operating cash flow to net income ratio is positive, suggesting that the company is generating sufficient cash from operations despite net losses. The free cash flow to net income ratio is also positive, highlighting effective cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	117.60M	93.62M	117.93M	117.93M	132.24M	149.18M
Gross Profit	58.85M	28.48M	79.77M	82.23M	86.78M	89.45M
EBITDA	27.02M	15.27M	33.67M	40.87M	59.66M	59.96M
Net Income	-4.03M	-10.92M	-2.21M	9.68M	28.55M	32.02M
Balance Sheet
Total Assets	178.28M	189.56M	230.81M	265.19M	226.31M	202.02M
Cash, Cash Equivalents and Short-Term Investments	16.29M	6.72M	22.22M	20.75M	11.29M	35.51M
Total Debt	14.22M	24.73M	45.63M	59.38M	25.25M	16.09M
Total Liabilities	59.11M	74.82M	103.12M	121.47M	88.99M	90.22M
Stockholders Equity	118.28M	113.95M	131.00M	142.34M	135.90M	110.90M
Cash Flow
Free Cash Flow	48.77M	32.50M	13.16M	-36.90M	-35.87M	43.49M
Operating Cash Flow	60.66M	32.83M	30.75M	37.53M	21.53M	99.12M
Investing Cash Flow	-23.20M	-17.18M	-14.78M	-78.33M	-53.72M	-61.34M
Financing Cash Flow	-24.54M	-20.91M	-13.40M	39.24M	7.42M	-10.80M

Digital Bros S.p.A. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 13.14
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:DIB, the sentiment is Positive. The current price of 13.14 is below the 20-day moving average (MA) of 13.16, above the 50-day MA of 12.38, and above the 200-day MA of 12.50, indicating a neutral trend. The MACD of 0.24 indicates Positive momentum. The RSI at 53.28 is Neutral, neither overbought nor oversold. The STOCH value of 11.89 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IT:DIB.

Digital Bros S.p.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DGV	71 Outperform	€288.65M	15.31	―	2.83%	-24.28%	-57.55%
DIB	66 Neutral	€181.17M	-46.50	-8.92%	―	-1.36%	-91.72%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
CY4	60 Neutral	€183.15M	-27.45	-7.05%	―	29.64%	62.10%
IOT	51 Neutral	€371.00M	-40.82	-3.24%	―	1.84%	-15.49%

Digital Bros S.p.A. Corporate Events

Digital Bros Reports Strong Q1 Financial Performance with Doubling Revenues

Digital Bros reported a significant increase in its financial performance for the first quarter of the 2025-2026 financial year, with revenues more than doubling to 45.5 million euros, driven by the success of the new video game Wuchang: Fallen Feathers and strong sales of Assetto Corsa. The company achieved a net profit of 4.7 million euros, a substantial improvement from the previous year’s loss, and confirmed positive revenue growth estimates for the entire financial year, highlighting its strong position in the video game industry.

Digital Bros Releases Shareholders’ Meeting Documents

Digital Bros S.p.A. has announced the availability of documents related to its Ordinary Shareholders’ Meeting held on October 27, 2025. These documents, including the minutes of the meeting and attachments, can be accessed at the company’s headquarters, on its website, and through an authorized storage mechanism.

Digital Bros Releases June 2025 Financial Statements

Digital Bros S.p.A. has announced the availability of its Consolidated Financial Statements and Financial Statements as of June 30, 2025. These documents can be accessed at the company’s headquarters, on their website, and through an authorized storage mechanism, providing stakeholders with the necessary financial insights and transparency.

Digital Bros Approves Financial Statements Amid Revenue Decline

Digital Bros S.p.A. held its Ordinary Shareholders’ Meeting, where it approved the financial statements for the fiscal year 2024-2025, despite a notable decline in revenues and increased losses attributed to underperforming new launches and project cancellations. The meeting also saw the approval of the allocation of operating profit to retained earnings and the authorization for the purchase and disposal of treasury shares, aiming to enhance market liquidity and support strategic transactions.

Digital Bros S.p.A. Announces Shareholders’ Meeting for October 2025

Digital Bros S.p.A. has announced a call for an Ordinary Meeting of shareholders on October 27, 2025, to discuss and resolve on various agenda items, including the approval of financial statements and the allocation of profits. The meeting will be conducted exclusively through a Designated Representative, Computershare S.p.A., ensuring compliance with legislative requirements and facilitating shareholder participation through proxy voting.

Digital Bros Faces Revenue Decline Amid Strategic Shift

Digital Bros reported a 20.6% decline in revenues for the 2024-2025 financial year, attributed to underperforming new game launches. Despite a stable gross operating margin percentage, the company faced a negative operating margin and net loss, but expects revenue growth and positive operating margins in the next financial year. The company has undertaken a strategic review to focus on high-margin games with predictable revenues, particularly those with owned intellectual property.