Good morning.
Good morning.
Hyvää huomenta. It's Jussi and Antti here again from Nitro Games, delivering you guys our Q1 interim report.
That is this morning's agenda.
Yes. Yes. In general, it's getting pretty good, you know. Summer is coming and so on, and we've had a great run so far this year, so lots of good stuff coming up today.
Exactly. It was indeed best start of the year.
Yeah. Yeah.
I think.
I think in the whole almost 15 years.
Yeah
of our history, so good times.
Very, very good times and good start for.
Yeah
For this exciting year despite all the things happening around.
Yeah. Indeed. Let's deep dive into Nitro and what we've been up to. As a reminder, we are your global powerhouse for action and shooter games on mobile, headquartered here in Finland. What we mean with that is that our vision is to become the household name in the category of shooter games, and basically, we do all things that go boom on mobile phones, whether it's smartphones and tablets as well. That's one of our big focus areas this year. The other one is growing our service business where we offer our services and expertise to our partners.
Indeed. In general, we are seeing lots of growth in a category.
Yeah
... where we are focusing, and our offering and the story is resonating better and better all the time on the market, and especially when the market is growing. There are new opportunities in the market. There are new platforms, social media channels are entering into the field. There are even movement in so-called emerging markets-
Yeah
to support
Definitely. Yes.
our offering strategy and story.
Yeah. A lot of this we saw earlier this year in March when we finally got to the Game Developers Conference in March in San Francisco, which is this annual event, which for us is typically pretty much the largest industry event when it comes to business development.
Yeah
Meeting with partners, and it was so clearly visible there that.
Yeah
Shooter games have definitely made their way on mobile, and now there's more and more parties seeking to get their
Yeah
... share of the pie. All right. If we look at the first quarter, in terms of some highlights, so obviously the first thing that catches the attention is the pretty notable revenue growth compared to first quarter last year. This is a direct result of a lot of the good things we did both last year and also earlier this year and where we managed to sign several new agreements in our service business and then also deliver on those agreements. Our EBITDA decreased slightly year-on-year, but that's well in line with our roadmap and plans for this year because our number one focus point for the year is a lot of game launches, and those obviously take a lot of preparations in terms of marketing and testing and everything related to that.
This is something that we are seeking to do moving forward as well, investing into the both ongoing and upcoming game launches.
In our service business side.
It was like a record high order
Yeah
value. Actually, the orders were more than last year revenue-
Yeah. Yeah
in the first quarter.
Yeah.
We are very happy and proud of our team on that front and also our capabilities to find good projects and assign good projects and
Yeah
... build also kind of continuing deals with the clients that we already served last year and now expanding those cooperations. For example, with the Supermassive Games, where we signed an unannounced mobile game development that we already had a, like, a pre-production concept and deal with-
Yeah. Yeah
with the guys.
Last year. Yeah.
Yeah. Also with the Metacore, we signed a roughly EUR 1 million deal for the mobile development. Also as already said, there are more and more interest towards our offering also in new platforms and instant gaming and social media platforms. We signed a partnership agreement with the leading social media channel, and that is very exciting to see what kind of games and business opportunities those new platforms will bring us.
Yeah. Yeah. Definitely. There seems to be more and more movement when it comes to instant gaming or then Web3 or HTML5. There's so many different names. But like, what we're seeing overall is that several of the leading social media platforms are looking into games, some from little bit different angles. While it's still very-
Not only the social media, but the streaming platforms and the-
Yeah. Definitely. Yes. It's obviously something where there's a lot of unexplored territory still remaining, but we are as a company in a good position because we can take advantage of that and be well-positioned by offering our services there. Obviously we've already accumulated experience because if you look at the games now, we released Blast Heroes on Snapchat at the end of the quarter. That's our first instant game we've ever done. We still have three more games that we've signed with Snap and with this another leading social media platform. There's two things in production. We still can't talk too much about those, but
Later this year.
Yeah. Soon we can. Then there's of course the other end of the spectrum, like bigger productions where we have NERF: Battle Arena, which has been very much a focus point for us here in Nitro earlier this year. I'm sure you guys have already seen the game because it's been now in soft launch. With that game, we still have some work to be done before we can actually release it globally. It just keeps looking better and better all the time. We'll talk more about that later today, but the amount of opportunities we're seeing in connection with that title makes us feel really good.
Yeah
... for our business year.
It also proves out our multi-project model.
Yeah.
We can run several parallel projects simultaneously and
Yeah
We have find a way so-called hybrid model where we combine our internal teams and our partner networks and scale the operations.
Yeah, yeah.
Still keep those productions and projects like separately and in control.
Yeah. Gives us the flexibility.
Yeah
that we need to
Flexibility and scalability.
Yeah. Given that game launches are very much a focus item for us in Nitro this year, we have more coming up. We have Lootland and then yet unannounced game, which we will likely announce moving forward sooner than later, I hope. Those are in the pipeline to get the soft launch obviously first so that we can really measure what's happening with them. Then like I said, we have three more games coming with Snap, two games with this another leading social media platform. Of course, we continue servicing our valued customers correctly. We've been delivering for Digital Extremes all the milestones and gotten those approved and so on. Overall, beginning of this year has been a lot larger in many ways.
We've been doing more things, but without sacrificing the quality. That's something I'm personally really proud that we-
Yeah
We have been able to really stay focused on delivering quality with everything that we do.
Yeah. I think one good point for the multi-project model is that there are either also those small and big projects.
Yeah
those are balancing the also the risk for us.
Yeah. Definitely.
We are not so dependent on one or two projects, but
Yeah
There are always fallback plans if something doesn't go as planned.
Yeah. Which is super important in this hit-driven
Yeah
... business. When we look at the other things, the real magic behind all of these successes that we've accumulated so far this year, that's obviously thanks to our team. We often like to say that our team is our most valuable assets because, you know, projects come and projects go, and games come and games go, but the team is really the fundamentals that makes everything happen. These days we talk about Nitro as a global team because even though we're headquartered here in Finland where we have 50 people, we've been strengthening our team also here in Finland. Parallel to that, we've been also strengthening it outside of Finland through our network of partner studios.
That is something that we constantly do.
Yeah
It's like a continuous process of evaluating, finding and evaluating new partners. With the partners that we then agree to go in some production, we are doing kind of continuous due diligence for the partners, evaluating their capabilities. That is also paving the road for us in a future potential non-organic growth.
Yeah
paths and so forth. We know those people, especially people and processes and companies really well as we're working with them. Currently, we have roughly 200 professionals in our-
Yeah
network and all around the world, and model seems to be working really well.
Yeah. Yeah. I'm really happy about how our people have been, you know, delivering on that collaboration. Happy to hear feedback, you know, from the CEOs and so on, from these partner studios and so on, that they really like working with Nitro-
Yeah
They've been happy about the partnership, and we've been able to build-
Yeah
A model that's, you know, benefiting both parties.
Yeah.
That means that we feel very good about that we're building something that's sustainable and scalable in the long run as well.
Same applies for our customers, since we
Yeah
We are always transparent with our customers.
Yeah
about what is the team composition and it has been working very well.
Yeah
Toward the customers also.
Yeah. Definitely.
Yeah.
If we look at the bigger picture in terms of our dear owners and our strategy, we've been talking about our strong foundation already in previous webcasts, and that obviously is very much still there. As a quick recap, we were founded in 2007. This year we're gonna be celebrating our 15 years, so that's quite an achievement on its own already. We've been a publicly listed company since 2017 when we listed in Nasdaq First North Growth Market in Stockholm in June. Our biggest events on the front of our foundation and owners in recent years have been in 2020 when Nordisk Games joined us as our leading investor. As we learned at the end of last year, they just increased their ownership-
Yeah
became a major owner. Overall, we feel really good about the support that we're getting from all our shareholders across the board, even from the very small owners to all the way to biggest. It seems like everyone seems to be really well aligned with what our goals are, and we get a lot of love and feedback and support from everyone. We're really grateful of that because it really helped and resonates also with the team in-house because we know that we have a large following, more than 5,000 shareholders.
Yeah.
So.
I think we have quite a unique kind of foundation or setup on a high level as we are a founder-driven company.
Yeah
Yet we are public.
Yeah.
We have a very strong kind of industrial owner, and we've been able to take benefits of the founder-driven kind of enthusiasm.
Yeah
... being a public company, taking the benefits from there, and then benefiting also from the strong owner. I think that's quite unique what we've been able to create on our setup.
Yeah. Not to forget being part of the Nordisk Games family.
Yeah.
There are several other game companies there. There's a lot of expertise about some of the things that are relevant for us, and, some of these companies are larger than Nitro, some are perhaps a little bit smaller. There's a lot of synergies that we get and the learnings, of course.
and even
Yeah
collaborating on a project.
Yeah, definitely. Yes. The strategy then again is straightforward. This is what we've been pursuing since 2017. Our strategy has basically two legs, and this year is a very special year for us when it comes to strategy because when it comes to the first leg, the game portfolio of action and shooter games, this year is the year when we do a lot of launches. Very exciting times because last year was a lot about development and production and starting new things, and this year is all about seeing how those play out. So far, the year has progressed well in line with them. Then again, the second-
Second leg, what we already seen in the first quarter is.
Yeah
like, better than ever. In our service business for partners, we are seeing more and more bigger and bigger projects, and at the same time, smaller projects to the new channels and new platforms where we balance the risk of the big projects.
Yeah.
I think the model in that side also starting to work really, really well and bringing the long-term scalable opportunity for us.
Yeah. Yeah, definitely. It helps us to reduce some of the volatility that we've seen in the service business in the previous year because we've been able to acquire, you know, project from different sources and in different scales like you said. Overall, so far, first quarter this year when it comes to both our strategy and our focus points has been, you know, the best quarter we've ever seen.
Yeah
At the beginning of the year. In that sense, a good start. If we look a little bit deeper into the project portfolio, as we call it, where we have the things that we have going on at the moment here in Nitro, then there's actually quite a lot to talk about. Let's begin with NERF: Battle Arena. That's something that we've been now developing for some time. We have the exclusive license to the NERF Blasters by Hasbro, and this game is currently in soft launch. We are preparing for the actual big rollout of the game, and there's a lot of buzz around this game.
Yeah
on all the fronts.
Pretty much all the industry players are.
Yeah
buzzing about and distribution channels and
Yeah
There are lots of attention towards the game.
Yeah. Yeah. That's obviously very positive for us. Now we have a lot to navigate-
Yeah
through and figure out the best possible setup for the upcoming launch. The thing that I'm most proud of is the persistent focus on quality by the team that actually worked on this. It already now has gained so much attention more than we expected and acts as a very good sort of proof of quality.
Yeah
... what we can deliver here in Nitro Games when it comes to experience. Very excited about the upcoming stuff with NERF: Battle Arena this year. Stay patient. Good stuff is on its way. We have Lootland, which is in development in one of our external partner studios. This game is something that's getting ready for the upcoming soft launch. Now during the second quarter, we are gonna pursue through some technical testing-
Yeah
make sure that everything is in order, and the publishing team has been preparing everything for the soft launch and, you know, the data pipelines. There's so many practicalities that need to take place. That one's going forward, so you can expect to see and hear more about that moving forward this year. We have our first-ever instant game, Blast Heroes, which is a top-down cooperative social shooter on the Snapchat platform. This has been very interesting journey for us overall because everything on the instant gaming side is so different.
It's so different.
you know?
All the marketing dynamics are different.
Yeah
How to drive users to the game are different.
Yeah
Very, very good learning for the team and for the company.
Yeah. While we are busy going through the initial launch phase with Blast Heroes, we've been happy to see first it was, you know, featured by Snap on their-
Yeah
platform in connection with the launch and just now during the Easter again.
During the Easter, there was a lot of feature.
Parallel to that, the teams have been busy working with Snap on the upcoming-
Yeah
three games we have and getting all the learnings, whether they are technical or data-driven from how the
Yeah
advertising works and so on. A lot of excitement towards how things are gonna play out with Snapchat in general, this year. We have the new game, which we haven't announced yet. Like I said earlier today, we're looking to announce that hopefully sooner than later, and that game is also something that's getting close to the end of production phase now, and we are preparing all things related-
Yeah
to soft launch.
Following the normal process that we have, what we use for ourselves.
Yeah
What we also sell to our customers.
Yeah. What we can say about this game is that we are very excited about how it's yet another take on the shooter category.
Yeah.
Like, it's not jeopardizing NERF: Battle Arena or Lootland for that matter in any way, but it's something like a yet another different take. It's well in line with our vision and our goals for this year to have different type of-
takes on the topic. We have this mysterious leading social media platform where we signed an agreement, actually in GDC.
That's the-
Yeah
Correct.
Yeah.
During the GDC.
Yeah.
Yeah.
Yeah. That's yet another record, by the way, because I don't think we've ever signed a deal.
First one to sign on in the event.
... in-
Yeah.
Yeah. Was a reason to celebrate. We have two games in production, but due to you know, water-tight confidentiality clauses and all that, we can't talk too much about that at this point. Again, moving forward, let's just say that this is again well in line with our goals this year by getting new launches happen. We have on our partner projects side, Digital Extremes. This
That's gone very, very exciting.
Yeah
position the project and starting to see on the screen something that we have never seen in a
Yeah
... in mobile games, and very high-quality fidelity.
Yeah
Stuff on the screen, heading into very, very interesting point.
Yeah, yeah. I'm super excited about how everything has gone so far, not just with the project, but with the partnership overall. We've had, you know, really good people on our end, but also on their end.
Yeah
working on the things and
Our partners are performing really well.
Yeah
on that project.
Yeah. This is definitely something that, you know, can't wait for the day to come.
Yeah
... when we can actually, you know, show it in more detail. Then we have something that's a little bit more new.
Yeah.
The Supermassive Games, they're a fantastic bunch of people. We have a great project in our hands based on their IP, and this is a collaboration that has started very well, and what is really good for Nitro is that this has, you know, followed pretty much exactly the same-
Yeah
goals that we had with our own stuff.
Started with the MVP process.
Yeah.
We had our first deal last year, and now expand it into the production and
Yeah, yeah. This is also quite a sizable production.
Yeah
To begin with, so it's already now looking awesome.
Yeah.
We have a service project with fellow Finnish Metacore, even though, you know, obviously in these type of things we don't talk about the project or what it is and stuff, but that's a project where we have our team assisting Metacore team with stuff related to a game.
Yeah.
That's something that we just recently signed and started, and we are very much looking forward to deliver fantastic quality on that project as well. We already discussed this.
Most of them coming
Coming with Snap, and we're looking forward to be able to announce more about those things moving forward.
As you can see from the project portfolio, many of our colleagues when they are speaking about multi-project model.
Yeah
It means two games.
Yeah
or three games, but for us, the multi-project model is really the multi-project.
Yeah
our process.
I think you end up with 12 if you.
Yeah
Count all them together.
Our process allows us to run the really many projects at the same time and keeping them in control and finding those success cases amongst the many.
I think if you put what we just went through again into the context of not just our strategy but our goals this year, we have a pretty healthy balance between the amount of game releases we have coming up versus, you know, the service business projects. It's safe to say that we're definitely not done yet.
No.
We are gonna stay very active in the business development, and we are exploring new opportunities as we speak. We're definitely not done yet when it comes to the amount of stuff that we have cooking. This would not be an interim report without financials. If we look first at the income statement for the first quarter, what we can see here is that we, you know, increased our revenues a lot compared to the Q1 last year. In that sense, it was a good start. As you can see from the income statement, we made some controlled investments into materials and services, which includes all the, you know, launch preparation.
costs and stuff that we are paying for third parties, also the development fees and things like that. Overall
While maintaining fixed cost level.
Yeah, yeah
Quite stable.
Yeah. This is how we navigate throughout the year, to begin with. Obviously, as we've discussed earlier, where we are headed to and what's our, you know, ultimate goal is to get to the break-even and profitability and so on. To launch the games, it obviously takes resources and money.
Yeah.
This is what we meant with in the previous webcast when we went through the last year results where we concluded that we were able to protect our strong cash position.
Yep
because now this year we need it with the game launches. We're really happy with how things are playing out so far. If you put this into the context of some previous quarters and how things have developed from the beginning of last year, both in terms of revenue and EBITDA, we're very much continuing on the path where we're seeking to obviously increase the amount of revenues we generate while making sure that we keep our EBITDA and cost level overall at bay.
Yeah
so that we can seek for the profitability. It goes without saying we're nowhere near done yet when it comes to
No.
our financial performance.
This level is much higher.
Yeah. As you can see from the cash position, we've been able to make sure that we, you know, control that side of things as well. Moving forward, we are seeking to continue our step-by-step improvements as we have done this far. The last part of our webcast is usually to look at the roadmap, like how did we get here and where are we headed next. There's actually no changes in here. We've been steadily exploring our strategy since our listing year, 2017. Last year we made a big success when it comes to expanding our project portfolio, so we signed new games, we signed new customer projects, we started new games of our own, and everything in between.
As a result of that, the beginning for this year has been, you know, like we've already said-
Yeah
better than ever.
Better than ever.
Yeah.
Now we've started to see the fruits of those past years.
Yeah. Exactly. This year is all about game launches and then again the B2B projects.
Yeah
both existing ones and obviously seeking for new ones. We are well on our way towards our vision to become a household name in the category of shooter and action games where things go boom.
Yeah.
That's how we are seeking to deliver shareholder value long term.
Exactly.
I think that concludes our update today.
Yeah. Appreciate it.
Thank you for joining, and let's quickly see if we've received any questions during the webcast via email. Actually, no. We're improving.
Just everything.
We're not leaving room for questions.
Online.
Yeah. Actually, by the way, the previous time, I don't remember the numbers anymore, but we had record attendance on the-
That's true, yeah.
Quarterly report webcast, so thank you for that as well. Is there any questions potentially on the phone line?
To ask a question, you have to press zero and one on your telephone keypad. We haven't received any questions via phone.
Okay. Fantastic.
All right.
Thank you so much. It's time to-
Thank you.
wrap up.
We'll see you soon.
Yes, yes. Watch this space from Nitro Games.
Yeah
Nitro Games, wishing you all a fantastic week. Thank you. Bye-bye.
Bye.