Digital Bros (505 Games) Expects an EBIT Loss of at Least €10 Million
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Digital Bros, the Italian group behind publisher 505 Games, now expects EBIT to fall below the level achieved in the previous fiscal year. This is due to the underperformance of Blades of Fire and higher-than-expected write-offs.
Digital Bros Group has updated its outlook for the 2025 fiscal year. The Italian company behind 505 Games begins with the following statement: "The video game market remains affected by challenging competitive dynamics, driven by an oversupply of new releases and increasingly selective consumers. These conditions make it particularly difficult to successfully launch new titles and to develop reliable forecasting models capable of accurately projecting sales and volumes at launch." In this context, Blades of Fire (developed by MercurySteam) underperformed the Group's expectations despite receiving generally positive reviews from the industry press and players when it was released on 22 May 2025 for consoles and as a PC exclusive on the Epic Games Store. "This confirms the challenges faced by most industry peers and competitors in attracting consumers to new titles, particularly when these are not backed by an established brand driving a loyal Player community."
Revenue for the fiscal year ending 30 June 2025 was already projected to decline year-on-year, but is now expected to contract further still. Persistent market uncertainty has led to higher-than-expected write-offs of around €8 million. The Group expects an EBIT loss of at least €10 million as of 30 June 2025. Digital Bros: "The net financial debt as of June 30, 2025, previously expected to remain in line with the Level reported on December 31, 2024, is now projected to be lower than Euro 20 million, improving significantly from the previous estimates."
In the current fiscal year, the company has already achieved success with Wuchang: Fallen Feathers, which achieved over 114,132 concurrent users (CCU) on Steam at launch, despite being available on Game Pass.
Founded in 1989, Digital Bros Group is a global company that operates as a developer, publisher and distributor of video games through its 505 Games brand. The group markets its content through both retail and digital channels. It has direct operations in Italy, the United States, the UK, the Czech Republic, China, Japan, Australia and Canada, employing 287 people worldwide.
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