GDEV reports 5 per cent revenue growth in third quarter

GDEV Inc., a global gaming company based in Limassol, reported a 5 per cent quarter-on-quarter revenue increase for Q3 2024, reaching $111 million.

However, revenue was down 9 per cent compared to the same period last year. The company also posted a net profit of $15 million, down from $24 million in Q3 2023.

Despite these challenges, GDEV’s strategic investments in its core franchises, including Hero Wars, Island Hoppers, and Pixel Gun 3D, have helped the company maintain steady adjusted EBITDA of $16 million.

Commenting on the results, GDEV CEO Andrey Fadeev said, “In Q3, despite industry pressure, we delivered sequential revenue growth. We also kept executing our strategy and moved forward with the transformation of our core products.”

He added, “The updates are rolling across our main franchises to elevate the game experience, adding new modern features to what players already love.”

Fadeev further noted, “We are not after quick wins – it’s about innovating in a way that sets us up for lasting impact.”

Additionally, the company established an at-the-market offering (ATM) in September, allowing the sale of up to 1.76 million treasury shares to increase liquidity.

Fadeev explained, “We expect the ATM to be effective until we sell all the treasury shares or for three years from the effective date of the Registration Statement, whichever is earlier.”

Selling and marketing expenses grew by 22 per cent year-on-year to $52 million as the company focused on scaling its business with targeted campaigns.

What is more, the results also showed that general and administrative expenses decreased by 9 per cent to $7 million.

The company also saw growth in its European market share, with bookings rising by 4 percentage points to 30 per cent.

Fadeev commented, “By staying focused, we’re building momentum for sustainable growth that will shape our future.”

GDEV also announced the appointment of former independent director Olga Loskutova as Chief Operating Officer.

Fadeev highlighted her role, stating, “As COO, Olga will be well-positioned to enable us to reach our ambitious strategic goals.”

Bookings for Q3 2024 amounted to $93 million, an 8 per cent decline compared to Q3 2023, driven by a 16 per cent reduction in monthly paying users.

However, the average booking per paying user (ABPPU) increased by 10 per cent year-on-year to $92.

The shift towards PC platforms continued, with their share of bookings increasing to 38 per cent in Q3 2024.

GDEV emphasised its disciplined cost management approach, with game operation costs remaining stable at $13 million and cash flows from operating activities increasing to $12 million in Q3 2024, compared to $8 million in Q3 2023.

The company ended the quarter with a strong cash position of $153 million, up from $140 million at the end of Q2 2024, providing opportunities for future expansion.

Nexters CEO discusses industry challenges and future gaming trends

In related news, Nexters CEO and GDEV COO Anton Reinhold recently spoke to Aaron Astle at Pocket Gamer Connects.

He said that with a mission to bring core gaming experiences to casual players, Nexters has cemented its position in the global market.

Reflecting on the past year, Reinhold described it as a challenging period for the entire industry.

“It was a difficult year, however, as well as for the entire game development industry. A decrease in growth rates, satiation with creatives, difficulties with purchasing users—these are all the things that we have observed and are currently observing in the market,” he explained.

Despite these headwinds, Nexters pressed ahead with strategic initiatives, including expanding its footprint into Armenia and Kazakhstan.

The company also made significant strides with its flagship franchise, Hero Wars.

“We have divided Hero Wars into two games: the mobile Hero Wars Alliance and the browser-based Hero Wars Dominion Era,” he said.

“Thanks to this, we now see that the players have become more aware of how the versions differ from each other,” Reinhold added.

The launch of Island Hoppers marked another milestone for Nexters.

“We have brought Island Hoppers to a full-fledged launch this year and achieved positive results,” Reinhold said, stressing its success as a rising star in the company’s portfolio.

Nexters also expanded the Hero Wars universe, introducing a merchandise store, comics, and cartoons, demonstrating its commitment to building comprehensive gaming ecosystems.

Looking to the future, Reinhold is optimistic about the transformative changes that lie ahead. He sees the convergence of virtual reality (VR), augmented reality (AR), and blockchain as pivotal to reshaping the gaming landscape.

“The anticipated advancements in cloud gaming, AI, and esports, along with a growing focus on inclusivity and accessibility, promise to create richer and more immersive experiences for gamers,” he said.

Reinhold stressed out that staying competitive in this evolving environment requires innovation and a willingness to challenge conventions.

“We see that many of our mature competitors have not seen many major breakthroughs in the development or marketing of their products, nor explosive growth. Overcoming competition requires going against the grain and innovation. Everyone has to work hard, polish every aspect, and play to their strengths to see growth,” he said.

Nexters is already positioning itself for the opportunities ahead, with a focus on research and development, precision in adopting new trends, and creating interconnected gaming experiences.

The company’s recent achievements, from the launch of Island Hoppers to the expansion of the Hero Wars universe, underline its resilience and commitment to growth.

“The future of mobile gaming is connected, casual-core, and constantly evolving,” Reinhold concluded.