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CD Projekt (OTGLY)
OTHER OTC:OTGLY
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CD Projekt
(OTC:OTGLY)
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Rating:67Neutral
Price Target:
$21.50
▲(29.21% Upside)
The score is primarily supported by strong profitability and an exceptionally low-debt balance sheet. It is held back by recent revenue declines and inconsistent free cash flow, plus muted technical momentum and a high P/E with a low dividend yield.
Positive Factors
High Profitability
Sustained very high gross and net margins reflect scalable digital distribution and high-margin content (DLC/expansions). These margins provide durable earnings power, funding development and R&D across multi-year cycles and cushioning downturns between major releases.
Conservative Balance Sheet
Extremely low leverage and a large equity base deliver strong financial flexibility. This solvency hub enables funding of long development cycles, opportunistic M&A or buybacks, and reduces refinancing risk during industry slumps or post-launch revenue variability.
Strong Operating Cash Generation
Operating cash consistently exceeding net income shows robust cash generation from core operations. This provides a durable source to self-fund game development and live-service support, lowering reliance on external financing through product cycles.
Negative Factors
Top-line Declines
Repeated revenue declines across consecutive periods indicate dependency on hit-driven release cadence. Persistent top-line erosion would pressure long-term growth, limit reinvestment capacity, and make earnings less predictable between major franchise launches.
Free Cash Flow Variability
Uneven FCF undermines the ability to consistently fund development, marketing, and shareholder returns. Volatile post-investment cash generation complicates capital allocation and increases the chance management must delay or cut strategic investments in weaker revenue periods.
Earnings Volatility
Reliance on sporadic blockbuster releases creates lumpy earnings and ROE swings. This structural volatility hampers long-term forecasting, raises execution risk for sustaining franchises, and can lead to abrupt shifts in profitability absent consistent hit development.
CD Projekt (OTGLY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.04B
Dividend Yield0.41%
Average Volume (3M)1.24K
Price to Earnings (P/E)47.4
Beta (1Y)0.91
Revenue Growth5.50%
EPS Growth35.59%
CountryUS
Employees634
SectorCommunication Services
Sector Strength97
IndustryElectronic Gaming & Multimedia
Share Statistics
EPS (TTM)0.13
Shares Outstanding399,642,030
10 Day Avg. Volume0
30 Day Avg. Volume1,236
Financial Highlights & Ratios
PEG Ratio-24.28
Price to Book (P/B)6.79
Price to Sales (P/S)19.30
P/FCF Ratio109.38
Enterprise Value/Market Cap3.52
Enterprise Value/Revenue28.43
Enterprise Value/Gross Profit27.16
Enterprise Value/Ebitda55.05
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
CD Projekt Business Overview & Revenue Model
Company DescriptionCD Projekt is a Polish video game developer and publisher, best known for its critically acclaimed role-playing game series, The Witcher, and the open-world game Cyberpunk 2077. Founded in 1994, the company operates primarily in the entertainment sector, focusing on video games for various platforms, including PC, consoles, and mobile devices. In addition to game development, CD Projekt owns GOG.com, a digital distribution platform for video games and films, which emphasizes DRM-free content and classic titles.
How the Company Makes MoneyCD Projekt generates revenue primarily through the sales of its video games, with significant earnings coming from both physical and digital copies. The Witcher series and Cyberpunk 2077 represent major revenue streams, with sales bolstered by expansions, downloadable content (DLC), and merchandise. The company also earns income from GOG.com through the sale of third-party games, as well as its own titles. Additionally, CD Projekt has established partnerships for licensing and collaborations, which can contribute to its overall revenue. The company’s revenue model is further supported by ongoing community engagement and post-launch support, which help maintain player interest and drive additional sales over time.
CD Projekt Earnings Call Summary
Earnings Call Date:May 28, 2025
(Q1-2025)
| % Change Since: |
Next Earnings Date:Mar 26, 2026
Earnings Call Sentiment Positive
The earnings call highlighted several positive developments, including successful product launches and strong sales figures for existing titles. Financial performance was robust, with notable profit and strategic decisions regarding dividends and share buybacks. However, increased operating costs and high income tax adjustments posed challenges. The positive aspects significantly outweighed the negatives.Q1-2025 Updates
Positive Updates
Cyberpunk 2077 Ultimate Edition Launch
Cyberpunk 2077 Ultimate Edition is set to be a launch title for the Nintendo Switch 2 on June 5, 2025, marking a significant milestone as the first time one of CD PROJEKT's games will debut on a new platform.
Phantom Liberty Expansion Success
The Phantom Liberty expansion for Cyberpunk 2077 has surpassed 10 million copies sold worldwide since its release in September 2023, demonstrating the expansion's quality and the enduring appeal of the Cyberpunk franchise.
The Witcher 3: Wild Hunt Sales Milestone
The Witcher 3: Wild Hunt has now sold over 60 million copies globally, contributing PLN2.4 billion in revenue over the past decade, establishing it as one of the best-selling games of all time.
Strong Financial Performance
CD PROJEKT reported a net profit of PLN86 million for Q1 2025 with an EBIT increase of 18% year-over-year, supported by strong sales and strategic amortization decisions.
Dividend and Share Buyback Plans
CD PROJEKT proposed a dividend of nearly PLN100 million and a share buyback to settle its incentive program, reflecting a strong cash position and confidence in future performance.
Negative Updates
High Income Tax Adjustments
A relatively high income tax of nearly PLN22 million was recorded for Q1 2025, mainly due to adjustments relating to prior years, impacting net results.
Increased Operating Costs
Operating costs remained stable overall but included extra expenses related to the new ERP system implementation and increased costs of incentive programs.
Company Guidance
During the Q1 2025 Earnings Conference Call held on May 28, CD PROJEKT provided several key metrics and guidance. They announced that the Cyberpunk 2077 Ultimate Edition would be a launch title for the Nintendo Switch 2 on June 5, 2025, marking the company's first game to be a launch title on a new platform. The Phantom Liberty expansion for Cyberpunk 2077 surpassed 10 million copies sold worldwide within just over 20 months since its release. The Witcher 3: Wild Hunt celebrated its tenth anniversary, with global sales exceeding 60 million copies and generating PLN2.4 billion in revenue. The company's development team has grown to over 730 developers, with 420 focused on The Witcher 4, which is in production, while Cyberpunk 2 has moved into preproduction. Financially, CD PROJEKT reported Q1 2025 sales revenue of PLN226 million, consistent with the previous year, and a net profit of PLN86 million, with a group net profitability of 38%. They also proposed a dividend of nearly PLN100 million from 2024 profits and a share buyback program valued at around PLN20 million.CD Projekt Financial Statement Overview
Summary
Strong profitability (TTM ~81% gross margin and ~51% net margin) and an exceptionally conservative balance sheet with minimal leverage support resilience. Offsetting this, revenue has declined in 2024 and again in TTM, and free cash flow has been uneven (rebounded in TTM but remains under half of net income), indicating product-cycle-driven volatility.Income Statement
Profitability is a clear strength, with very high margins in TTM (Trailing-Twelve-Months) (about 81% gross margin and ~51% net margin), supported by strong operating profitability. However, the top line is trending down: revenue declined in 2024 and fell again in TTM, following a strong 2023. Overall, earnings power is strong, but results look volatile and reliant on periods of major release strength.84
Very Positive
Balance Sheet
The balance sheet is exceptionally conservative, with very low leverage (debt is well under 1% of equity across periods) and a large equity base. Returns on equity are solid in recent years (mid-to-high teens to ~20% in TTM), though they have fluctuated materially (including a very high 2020). Key risk is less about solvency and more about earnings volatility impacting returns over time.92
Very Positive
Cash Flow
Operating cash generation is healthy and consistently exceeds net income in the most recent periods (TTM operating cash flow covers net income by over 3x). The main weakness is free cash flow variability: free cash flow dropped sharply in 2024 and, while it rebounded in TTM, it remains modest versus net income (under half of net income in TTM). Cash conversion is therefore solid at the operating line but less consistent after investment and working-capital swings.73
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 871.49M | 985.03M | 1.23B | 952.58M | 888.17M | 2.14B |
| Gross Profit | 912.07M | 737.88M | 849.63M | 708.60M | 637.94M | 1.65B |
| EBITDA | 450.07M | 448.49M | 553.33M | 514.32M | 329.12M | 1.44B |
| Net Income | 429.78M | 469.87M | 481.11M | 347.09M | 208.91M | 1.15B |
Balance Sheet | ||||||
| Total Assets | 3.30B | 3.04B | 2.61B | 2.27B | 2.16B | 2.89B |
| Cash, Cash Equivalents and Short-Term Investments | 153.27M | 1.19B | 878.98M | 894.67M | 984.35M | 834.15M |
| Total Debt | 5.82M | 20.15M | 20.04M | 28.46M | 46.88M | 18.94M |
| Total Liabilities | 237.60M | 241.76M | 209.95M | 240.72M | 264.38M | 707.12M |
| Stockholders Equity | 3.06B | 2.80B | 2.40B | 2.03B | 1.89B | 2.19B |
Cash Flow | ||||||
| Free Cash Flow | 52.09M | 173.84M | 280.07M | 149.93M | 784.46M | 490.12M |
| Operating Cash Flow | 471.93M | 521.30M | 610.88M | 406.03M | 967.83M | 711.71M |
| Investing Cash Flow | -376.96M | -470.55M | -607.35M | -335.61M | -613.79M | -106.39M |
| Financing Cash Flow | -36.51M | -103.92M | -103.31M | -204.18M | -505.78M | -91.39M |
CD Projekt Technical Analysis
Negative
16.64
Price Trends
17.45
Negative
17.45
Negative
17.25
Positive
Market Momentum
0.20
Positive
44.38
Neutral
0.98
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OTGLY, the sentiment is Negative. The current price of 16.64 is below the 20-day moving average (MA) of 18.24, below the 50-day MA of 17.45, and below the 200-day MA of 17.25, indicating a neutral trend. The MACD of 0.20 indicates Positive momentum. The RSI at 44.38 is Neutral, neither overbought nor oversold. The STOCH value of 0.98 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OTGLY.
CD Projekt Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $432.60M | 3.79 | 12.55% | ― | 1.21% | 0.72% | |
70 Outperform | $49.26B | 75.61 | 10.03% | 0.37% | -1.45% | -11.99% | |
67 Neutral | $7.04B | 47.36 | 19.54% | 0.41% | 5.50% | 35.59% | |
66 Neutral | $1.30B | 14.88 | ― | 9.98% | 7.49% | -60.32% | |
65 Neutral | $12.97B | 115.98 | 5.30% | ― | 16.84% | ― | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
57 Neutral | $37.10B | -8.97 | -86.22% | ― | 13.98% | -6.71% |
* Communication Services Sector Average
OTGLY
CD Projekt
17.39
3.88
28.68%
EA
Electronic Arts
196.84
65.47
49.84%
TTWO
Take-Two
200.76
17.68
9.66%
BILI
Bilibili
30.20
12.14
67.22%
DDI
Doubledown Interactive Co
8.43
-1.97
-18.94%
PLTK
Playtika Holding
3.46
-3.13
-47.46%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.