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Paradox Interactive (SE:PDX)
:PDX
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Paradox Interactive AB
(OTC:PDX)
Select Model
Select Model
Rating:70Outperform
Price Target:
kr195.00
▲(12.07% Upside)
Paradox Interactive AB's overall stock score is driven by strong financial performance and solid cash generation. However, concerns about declining revenue and free cash flow, combined with a high P/E ratio, suggest potential overvaluation. Technical indicators show mixed signals, with some bullish momentum but no strong directional trend.
Paradox Interactive AB (PDX) vs. iShares MSCI Sweden ETF (EWD)
Market Cap
kr18.38B
Dividend Yield2.9%
Average Volume (3M)74.07K
Price to Earnings (P/E)27.7
Beta (1Y)0.74
Revenue Growth-16.72%
EPS Growth106.55%
CountrySE
Employees596
SectorCommunication Services
Sector Strength97
IndustryElectronic Gaming & Multimedia
Share Statistics
EPS (TTM)1.04
Shares Outstanding105,623,024
10 Day Avg. Volume97,012
30 Day Avg. Volume74,073
Financial Highlights & Ratios
PEG Ratio3.58
Price to Book (P/B)7.46
Price to Sales (P/S)9.86
P/FCF Ratio41.73
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
kr186.42Price Target Upside7.14% Upside
Rating ConsensusHold
Number of Analyst Covering5
Paradox Interactive AB Business Overview & Revenue Model
Company DescriptionParadox Interactive AB (PDX) is a Swedish video game publisher and developer known for its deep strategy games and simulation titles. Established in 1999, the company specializes in creating complex and engaging games that often focus on historical and grand strategy themes. PDX's portfolio includes popular franchises such as Crusader Kings, Europa Universalis, and Stellaris, which have garnered dedicated fanbases and critical acclaim. The company operates primarily in the interactive entertainment sector, providing both single-player and multiplayer gaming experiences across multiple platforms.
How the Company Makes MoneyParadox Interactive generates revenue through several key streams: game sales, downloadable content (DLC), and expansions. The company releases both physical and digital versions of its games, with digital sales accounting for a significant portion of revenue due to the rise of online gaming platforms. PDX strategically develops and sells DLCs and expansions that enhance the core gaming experience, encouraging players to invest further in their favorite titles. Additionally, Paradox Interactive often engages in partnerships with other developers and publishers to co-create or distribute games, expanding its reach and revenue potential. The company's ongoing commitment to community engagement and support for modding also fosters a loyal customer base, which translates to sustained sales over time.
Paradox Interactive AB Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q1-2025)
| % Change Since: |
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with significant strategic moves, such as the acquisition of Haemimont Games, and strong cash flow, but it was tempered by a decline in revenue due to fewer releases and adverse currency impacts.Q1-2025 Updates
Positive Updates
Acquisition of Haemimont Games
Paradox Interactive completed the acquisition of Haemimont Games, aligning with their strategic intent to expand into the management segment of games.
Strong Cash Flow
Despite a slow quarter, Paradox Interactive reported a strong cash flow, with cash flow from operating activities at SEK266 million, up from SEK137 million in Q1 last year.
Stable Operating Profit
Operating profit for Q1 was SEK147 million compared to SEK154 million last year, showing stability despite fewer releases.
Equity through Asset Ratio Improvement
The equity through asset ratio improved from 78% last year to 83% this year.
Successful Expansion Passes
Three expansion passes for key IPs were announced and performed well, indicating strong product engagement.
Negative Updates
Revenue Decline
Revenues for Q1 2025 were SEK464 million, a decrease of 4% from SEK482 million in the same quarter last year, primarily due to fewer releases.
Currency Headwinds
Paradox Interactive faced currency headwinds with the Swedish Krona being 10% stronger against the dollar compared to last year, impacting financial results.
Negative Impact from Currency Movements
There was a negative impact of SEK23 million from currency movements, compared to a positive impact of SEK21 million last year.
Company Guidance
In the Q1 2025 call for Paradox Interactive, Fredrik Wester and Alex Bricca detailed the company's performance and strategic moves. Revenue for the quarter was reported at SEK464 million, a 4% decrease from SEK482 million in Q1 2024, attributed to fewer releases. Despite currency headwinds, the company maintained stable cash flow and made significant acquisitions, including Haemimont Games and the publishing rights for "Stranded: Alien Dawn." Operating profit was SEK147 million, with a profit margin of 33%, slightly lower than last year's 34%. The company highlighted its strategy of aggressive cost write-offs and noted a strong equity-through-asset ratio of 83%. Employee numbers averaged 596, reflecting the partial impact of the Haemimont acquisition. Cash flow from operating activities was strong at SEK266 million, despite the slow release schedule and acquisition costs. The firm outlined upcoming expansions for key IPs and emphasized its ongoing commitment to both new title launches and expanding existing franchises.Paradox Interactive AB Financial Statement Overview
Summary
Paradox Interactive AB demonstrates strong profitability with a solid EBIT margin and net profit margin. The balance sheet is robust with minimal leverage, but there are concerns about declining revenue and free cash flow.Income Statement
Paradox Interactive AB shows a strong profitability profile with a solid EBIT margin of 33.82% and a net profit margin of 26.64% for the TTM. However, the company experienced a revenue decline of 5.37% in the TTM, indicating potential challenges in maintaining growth. The gross profit margin remains healthy at 46.76%, suggesting efficient cost management.75
Positive
Balance Sheet
The company's balance sheet is robust, with a low debt-to-equity ratio of 0.018, indicating minimal leverage and financial risk. The return on equity (ROE) is strong at 21.15%, reflecting effective use of equity to generate profits. The equity ratio is not explicitly calculated, but the high stockholders' equity suggests a stable financial position.80
Positive
Cash Flow
Cash flow analysis reveals a decline in free cash flow growth by 20.58% in the TTM, which could be a concern. However, the operating cash flow to net income ratio of 3.09 indicates strong cash generation relative to net income. The free cash flow to net income ratio of 0.75 suggests good cash conversion efficiency.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.07B | 2.20B | 2.64B | 1.97B | 1.45B | 1.79B |
| Gross Profit | 1.13B | 997.29M | 1.25B | 1.11B | 566.49M | 988.15M |
| EBITDA | 1.29B | 1.47B | 1.67B | 1.36B | 431.50M | 757.31M |
| Net Income | 664.47M | 584.63M | 530.63M | 708.71M | 247.77M | 490.57M |
Balance Sheet | ||||||
| Total Assets | 3.24B | 3.53B | 3.58B | 3.14B | 2.52B | 2.52B |
| Cash, Cash Equivalents and Short-Term Investments | 1.02B | 1.47B | 1.30B | 747.51M | 599.72M | 767.56M |
| Total Debt | 45.09M | 64.79M | 108.58M | 140.46M | 168.97M | 201.90M |
| Total Liabilities | 625.63M | 622.71M | 959.67M | 849.05M | 861.13M | 1.01B |
| Stockholders Equity | 2.61B | 2.91B | 2.62B | 2.29B | 1.66B | 1.51B |
Cash Flow | ||||||
| Free Cash Flow | 748.28M | 519.85M | 745.64M | 288.85M | -12.66M | 484.75M |
| Operating Cash Flow | 1.12B | 1.12B | 1.45B | 1.08B | 736.59M | 1.13B |
| Investing Cash Flow | -699.03M | -403.22M | -848.28M | -806.97M | -766.57M | -758.37M |
| Financing Cash Flow | -566.76M | -355.17M | -248.96M | -140.97M | -139.59M | -148.48M |
Paradox Interactive AB Technical Analysis
Neutral
174.00
Price Trends
174.05
Negative
178.74
Negative
186.31
Negative
Market Momentum
-1.81
Positive
49.44
Neutral
60.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:PDX, the sentiment is Neutral. The current price of 174 is above the 20-day moving average (MA) of 173.77, below the 50-day MA of 174.05, and below the 200-day MA of 186.31, indicating a bearish trend. The MACD of -1.81 indicates Positive momentum. The RSI at 49.44 is Neutral, neither overbought nor oversold. The STOCH value of 60.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SE:PDX.
Paradox Interactive AB Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $773.46M | 9.60 | 15.05% | 8.92% | -15.26% | -22.70% | |
70 Outperform | kr18.38B | 27.66 | 24.96% | 2.90% | -16.72% | 106.55% | |
70 Outperform | $24.54B | 3.17 | 9.51% | ― | -37.87% | ― | |
61 Neutral | kr13.51B | ― | -0.52% | ― | 44.55% | -8.92% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
55 Neutral | kr1.60B | ― | ― | 3.23% | 5.10% | -623.00% | |
48 Neutral | kr2.85B | ― | ― | ― | -9.57% | -6078.38% |
* Communication Services Sector Average
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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.