Embracer Group AB (EMBRAC.B) AI Stock Analysis

• Market Cap: $19.54B
• Dividend Yield: N/A
• Average Volume (3M): 927.15K
• Price to Earnings (P/E): 2.5
• Beta (1Y): 1.16
• Revenue Growth: -37.87%
• EPS Growth: N/A
• Country: SE
• Employees: 7,873
• Sector: Communication Services
• Sector Strength: 96
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): -0.69
• Shares Outstanding: 216,119,700
• 10 Day Avg. Volume: 664,909
• 30 Day Avg. Volume: 927,152
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 0.81
• Enterprise Value/Gross Profit: 1.10
• Enterprise Value/Ebitda: 1.46
• 1Y Price Target: $93.53
• Price Target Upside: 6.42% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 60 Neutral
• Price Target: kr88.00 ▲(0.14% Upside)

Embracer Group AB's overall stock score is driven by strong profitability and a low P/E ratio, suggesting potential undervaluation. However, the significant revenue decline, negative free cash flow growth, and bearish technical indicators weigh heavily on the score, indicating potential risks.

Embracer Group AB Business Overview & Revenue Model

Company Description

Embracer Group AB (publ), together with its subsidiaries, develops and publishes PC, console, mobile, VR, and board games for the games market worldwide. The company has a catalogue of approximately 850 owned franchises, such as Saints Row, Goat Simulator, Dead Island, Darksiders, Metro, MX vs ATV, Kingdoms of Amalur, TimeSplitters, Satisfactory, Wreckfest, Insurgency, World War Z, and Borderlands, and others. It also publishes films and comics. It distributes games through retailers and digital distributors. The company was formerly known as THQ Nordic AB (publ) and changed its name to Embracer Group AB (publ) in October 2019. Embracer Group AB (publ) was incorporated in 1999 and is headquartered in Karlstad, Sweden.

How the Company Makes Money

Embracer Group generates revenue primarily through the sale of video games and gaming content, which includes both physical and digital formats. Key revenue streams come from game sales, in-game purchases, downloadable content (DLC), and subscriptions. The company also earns revenue from licensing its intellectual properties for merchandise, adaptations, and collaborations. Additionally, Embracer Group benefits from strategic partnerships with other gaming companies and platforms, which can enhance distribution and marketing efforts. The acquisition of various studios further diversifies its revenue sources, allowing for multiple successful franchises to contribute to its overall earnings.

Embracer Group AB Financial Statement Overview

Summary

Embracer Group AB shows strong profitability with a healthy gross profit margin of 72.62% and a net profit margin of 20.39%. However, the company faces challenges with a significant revenue decline of 15.66% and negative free cash flow growth of -416.60%, which are concerning for long-term sustainability.

Income Statement

Embracer Group AB's income statement shows mixed performance. The TTM data indicates a significant revenue decline of 15.66%, which is concerning. However, the company maintains a healthy gross profit margin of 72.62% and a net profit margin of 20.39%, suggesting strong profitability. The EBIT and EBITDA margins are also solid, although they have decreased compared to previous periods. Overall, while profitability remains strong, the declining revenue trend is a risk factor.

Balance Sheet

The balance sheet of Embracer Group AB reflects a stable financial position. The debt-to-equity ratio is low at 0.08, indicating conservative leverage. The return on equity (ROE) is 13.31%, which is a positive sign of profitability. The equity ratio is robust, suggesting a strong capital structure. However, the decline in stockholders' equity over the periods is a point of concern. Overall, the balance sheet is solid, with low leverage and decent profitability.

Cash Flow

The cash flow statement highlights some challenges for Embracer Group AB. The TTM free cash flow growth rate is significantly negative at -416.60%, indicating cash flow issues. The operating cash flow to net income ratio is 0.57, suggesting moderate cash generation relative to net income. The free cash flow to net income ratio is negative, reflecting cash flow constraints. While operating cash flow remains positive, the negative free cash flow growth is a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.66B	22.37B	42.21B	37.66B	17.04B	9.02B
Gross Profit	18.31B	18.38B	30.78B	27.68B	14.63B	6.70B
EBITDA	13.77B	12.54B	4.76B	11.69B	4.07B	4.07B
Net Income	7.73B	5.96B	-18.18B	4.45B	-4.29B	287.00M
Balance Sheet
Total Assets	41.02B	42.13B	95.70B	116.07B	93.45B	33.75B
Cash, Cash Equivalents and Short-Term Investments	6.88B	7.10B	3.34B	4.68B	5.81B	14.30B
Total Debt	2.60B	2.35B	21.18B	21.75B	20.31B	1.48B
Total Liabilities	10.38B	10.94B	43.21B	51.35B	48.64B	6.59B
Stockholders Equity	30.56B	31.13B	52.42B	64.67B	44.59B	27.15B
Cash Flow
Free Cash Flow	744.00M	-252.00M	529.00M	-1.61B	220.70M	1.69B
Operating Cash Flow	4.28B	3.49B	7.89B	5.38B	4.28B	3.90B
Investing Cash Flow	10.29B	14.02B	-9.95B	-15.49B	-37.89B	-6.80B
Financing Cash Flow	-9.73B	-12.65B	832.00M	8.50B	25.02B	14.73B

Embracer Group AB Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 87.88
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:EMBRAC.B, the sentiment is Neutral. The current price of 87.88 is above the 20-day moving average (MA) of 86.74, below the 50-day MA of 98.15, and below the 200-day MA of 107.90, indicating a neutral trend. The MACD of -3.96 indicates Negative momentum. The RSI at 45.53 is Neutral, neither overbought nor oversold. The STOCH value of 55.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SE:EMBRAC.B.

Embracer Group AB Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	60 Neutral	$46.29B	4.07	-13.12%	4.12%	1.85%	-42.71%
EMBRAC.B	60 Neutral	$19.54B	2.53	9.51%	―	-37.87%	―
0GXJ	―	kr11.17B	―	-0.52%	―	―	―
PRXXF	―	$2.00B	31.46	24.96%	2.70%	―	―
GENTF	―	$76.50M	9.53	15.05%	9.36%	―	―
EG7	55 Neutral	kr1.14B	―		3.23%	5.10%	-623.00%
SF	42 Neutral	kr2.79B	―		―	-9.57%	-6078.38%

Embracer Group AB Corporate Events

Embracer Group Faces Challenging Q1 2025 Amidst Strategic Transition

Embracer Group AB reported a challenging first quarter for 2025, with net sales declining by 31% compared to the previous year, primarily due to a quiet period for PC/Console game releases. Despite this, the company is focused on strategic execution and operational improvements, with plans to evolve into Fellowship Entertainment. The transition is supported by a strong IP portfolio and the upcoming listing of Coffee Stain Group. Embracer’s Entertainment & Services segment showed growth, but the overall financial performance was impacted by decreased sales in other segments. The company remains optimistic about its future, leveraging its creative talent and IPs to drive long-term value.

The most recent analyst rating on ($SE:EMBRAC.B) stock is a Hold with a SEK91.87 price target. To see the full list of analyst forecasts on Embracer Group AB stock, see the SE:EMBRAC.B Stock Forecast page.

Embracer Group to Present Q1 Financial Report for 2025/26

Embracer Group AB has announced an upcoming presentation of its Q1 financial report for the fiscal year 2025/26, scheduled for August 14, 2025. The presentation, led by CEO Phil Rogers and CFO Müge Bouillon, will be available via audio webcast and conference call, allowing stakeholders to engage with the company’s financial performance and strategic direction.

The most recent analyst rating on ($SE:EMBRAC.B) stock is a Hold with a SEK91.87 price target. To see the full list of analyst forecasts on Embracer Group AB stock, see the SE:EMBRAC.B Stock Forecast page.

Embracer Group Announces Leadership Changes and Spin-off Plans

Embracer Group AB has announced significant leadership changes as part of its ongoing transformation process. Phil Rogers will assume the role of CEO on August 1, 2025, while co-founder Lars Wingefors is proposed to become Executive Chair of the Board. Additionally, the company plans to spin off Coffee Stain Group as an independent entity listed on Nasdaq First North Premier Growth Market by the end of 2025, with several board appointments already outlined to ensure compliance with governance standards.

The most recent analyst rating on ($SE:EMBRAC.B) stock is a Hold with a SEK97.88 price target. To see the full list of analyst forecasts on Embracer Group AB stock, see the SE:EMBRAC.B Stock Forecast page.

Embracer Group Reports Mixed Financials and Strategic Spin-Off Plans

Embracer Group AB reported a mixed financial performance for the fiscal year ending March 2025, with a notable organic growth in net sales by 19% in the fourth quarter, driven by the success of ‘Kingdom Come: Deliverance II’. The company plans to spin off Coffee Stain Group by the end of 2025 to enhance its strategic focus and efficiency, while continuing to optimize its operations and unlock shareholder value.

The most recent analyst rating on ($SE:EMBRAC.B) stock is a Hold with a SEK96.16 price target. To see the full list of analyst forecasts on Embracer Group AB stock, see the SE:EMBRAC.B Stock Forecast page.

Embracer Group to Spin Off Coffee Stain Group and Rebrand as Fellowship Entertainment

Embracer Group AB has announced its plan to spin off Coffee Stain Group into a standalone entity by the end of 2025, with the intention of listing it on the Nasdaq First North Premier Growth Market in Stockholm. This strategic move aims to provide Coffee Stain Group with greater autonomy to focus on its core strengths in community-driven game development. Concurrently, Embracer will rebrand as Fellowship Entertainment, continuing to leverage its vast array of intellectual properties and creative assets to enhance its market position and foster innovation across its global operations.

The most recent analyst rating on ($SE:EMBRAC.B) stock is a Hold with a SEK96.16 price target. To see the full list of analyst forecasts on Embracer Group AB stock, see the SE:EMBRAC.B Stock Forecast page.

Embracer Group to Present Year-End Financial Report

Embracer Group has announced an upcoming presentation of its Year End Report for the fiscal year 2024/2025 and the interim report for the fourth quarter. The presentation, scheduled for May 22, 2025, will be led by the company’s CEO and CFO, and will include a Q&A session hosted by an equity research analyst from Nordea Equities. This event is significant for stakeholders as it provides insights into the company’s financial performance and strategic direction.

The most recent analyst rating on ($SE:EMBRAC.B) stock is a Hold with a SEK144.00 price target. To see the full list of analyst forecasts on Embracer Group AB stock, see the SE:EMBRAC.B Stock Forecast page.