Good afternoon, everybody. A warm welcome to you to our conference summarizing Q2 at TSG. My name is Andrzej Ilczuk, I'm CEO and President of the Management Board. I'm joined by Magdalena Jurewicz, our CFO. Good afternoon. Janusz Dziemidowicz, CTO. As always, Nina Graboś, responsible for contacting our investors. [Foreign language] , allow us now to move to our priorities and the performance of the group in Q2 2025. [Foreign language] . We wish to bring closer to you a few aspects. [Foreign language] . Q2 saw a very consistent following of our strategic plan. At the basis of the plan, we intend to increase our revenue. The transformation of the product is strongly based on data. Hard data, not belief, not opinions. The data begin to demonstrate that we are following the right path.
On top of that, we have started scaling Wings of Heroes since Q3 of this year. We've had a great start of Trophy Hunter. All these components brought together demonstrate that Ten Square Games is capable of creating new games. We know how to market these games. We know how to scale them. We have a full package under our wings. We believe that each of these elements brings us closer to achieving our main goal, which is, of course, increasing our revenue. Concentrating now on the performance of our key products, which are Fishing Clash and Hunting Clash. As we said in the previous conference, we had a very limited marketing budget, which was obviously intentional. We reduced our revenue base. Why did we decide to decrease our expenditure on marketing?
Simply because we believe that the changes in our games that are taking place are going to have a very positive impact on marketing in quarters to come. Additionally, given the ongoing numerous tests, we have a much more stable marketing base, or foundation, if you like. The mix month-to-month of players is very similar. The mix is almost identical, allowing us to be much more precise in our determination on whether these changes have a positive impact on the performance of our games. After we have concluded all our A/B tests, our marketing expenditure is going to be increased gradually. Moving on, allow me now to speak about some practical examples. I would like to devote some attention to segmentation. We have reached a third iteration of segmentation. Why is it so important?
First of all, as you remember, employing new people responsible for the product, changing our way of thinking about the product, working with the product, is an ongoing, constant change in Ten Square Games. Looking back in time on our way of working with the product, we had a somewhat startup approach. We had an idea, we tested the idea. If it worked, we would apply it. If it didn't, we would move to another one. We have completely changed our way of working with products. In the first assessment run by persons responsible for the product, we defined a few areas for improvement. One of these rooms was segmentation. In the first iteration, we saw a 21% uplift in bookings for the group participating in the test. However, we weren't shy by the fact that we didn't improve in this field.
Nonetheless, the team consistently continued in the test because they didn't understand why they saw the uplift in only one of the segments. In the following iteration, we saw an uplift in two segments. I believe that in next iterations to come, similar changes will follow. We are shifting our startup-like approach to an iteration-based approach, where on a daily basis, we look for answers to why some things work and why others don't. All that in order to make sure that these results improve iteration by iteration. Obviously, segmentation is not everything. There are hosts of others, smaller or bigger projects, such as segmentation or the ones that you are looking at on the screen. Some of these initiatives are very bullet-oriented on much smaller groups of players. In other cases, segmentations concern entire games.
The reason why we believe this is the right thing to do is that although we work with mature products, products that have been present on the market for many years, we still see that the increases or the improvement of performance in particular segments or features are not single digits. This proves that there is still a lot of potential in our games. As we look at Wings of Heroes, you might remember that in the second quarter, we concentrated on adding depth to the game. We have concluded this stage by increased marketing expenses starting in Q3. This increase in marketing expenditure has translated into a 30% increase of our revenue. Scaling of Wings of Heroes is not only increasing our marketing expenses, also reaching higher C's with this project. We have started this project as a flight game set in the reality of World War II.
Now we are concentrating on an action games segment. We are leaving the segment of flight simulators, so we see broader segments where we can offer our game to a bigger pool of players. In the third and fourth quarter, we count on increased revenue from this game, followed by increased marketing expenditure, but also at the same time, we are going to look for bigger blue oceans for this product. Allow me to say a few words about our new title, which is Trophy Hunter. Trophy Hunter has had a great debut. It's our third hunting-type game. It's the best-looking product in the market. Why is it important? It's mostly due to the fact that our players are looking for realistic settings, realistic animations, realistic animals where the feeling of shooting is very accurate. This game has demonstrated that the players are very happy with it.
It's very playable and enjoyable to play. One more important piece of information, it's a hybrid game. This means that these games also provide revenue from advertisement. This is important. Some of the revenue might not be reflected in our financial data. What is important with Trophy Hunter is that Ten Square Games is capable of creating new games and releasing new games. This skill is in great demand in our market. We are happy with the fact that after Wings of Heroes, Trophy Hunter is another game demonstrating that we are capable of creating new products.
Moving on, these are just a number of KPIs we want to share with you, but others, they look very promising as well. We have a much greater retention, much greater conversion. This game, as I said, started off really well.
We have a solid product with a lot of potential for the future. The one thing we need to do now is to work with this product in such a way as to make sure that the early stage KPIs show an even higher figure. To make sure that the later stage KPIs do not deviate strongly from the early stage ones. How to do that, how to achieve it? This is something we excel at as well. The upscaling of our products. The third and the fourth quarter are the quarters where our roadmap in Trophy Hunter is very, very packed. We have a lot of content. We have new, well-tailored features. Those are the elements that are meant to make sure that KPIs over the seventh and the 30th day will look very good and will be able to effectively upscale this project and the product.
When we move on to Real Combat Simulator, one information for starters, this will be a subscription-based game. Therefore, we will see whether or not this product could be comparable to Real Flight Simulator at the end of the day. A bit of a commentary on TSG Store in terms of Fishing Clash. The share is over 32% currently, and this is the share that we want to maintain definitely. We keep working on new initiatives in order to increase this share if possible. For Hunting Clash, it's more than 21% currently. Here we also are rolling up our sleeve in order to increase it. We want to catch up with Fishing Clash. All in all, we're talking about 23% versus the total revenue of the company. There are a couple of initiatives in Hunting Clash versus Deer Bucks, which is the same as Fish Bucks for Fishing Clash.
We have a special currency, loyalty currency in our store. We are fine-tuning the interface. We are working with commission providers. One more thing, which calls for a longer commentary, your questions concerning the regulatory environments and the background. A lot of things have been going on. Let me go back to the past a little bit to discuss the most important events that have an impact on our store. Last year, we had the DMA , the so-called DMA EU directive, which enforced certain changes on Apple. Apple did follow up. However, most of these changes had a high entry level. In our opinion, for instance, we had to resign from the bookings via Apple platform. We decided not to use it, this opportunity. We didn't know any company who would actually go towards that direction.
What we decided to do is to lower a little bit of our commission on the European platform from 30% to 20% according to Apple's recommendation. Thanks to those very subtle tweaks in the definition, in practice, we saw a change from 30% to 24%. We're talking about Apple platform only and European Union only, which happened in June last year. During the spring break, May spring break last year, we saw a ruling in the Epic versus Apple case. It turned out in the end that we are able to advertise alternative payment methods or booking methods via Apple platform. Again, we're talking about Apple platform only. We immediately started tapping into this opportunity, advertising our options via Apple platform in the United States of America. In June, we had yet another stage of this tug of war between Apple and the European Union.
Again, we had some new changes, which theoretically were supposed to adjust Apple's ways to the European Union regulations. We had certain newspapers' headlines that Apple would change commissions. We looked into this subject. We are keeping a watchful eye on these developments. We believe this is just a make-believe. If we were to tap into those new opportunities and lower down our commission, we would, first of all, need to switch off Apple payments. We wouldn't know how to survive without the app because we live off the app. We would have to actually switch off certain search options. There were a number of other difficulties that it would pose for us. In our opinion, this would be to the detriment of our company. We decided not to use that option because the losses would actually exceed the profits or the benefits.
We don't know of any company in the market that would actually go for this particular option. The European Union obviously will continue to work in this area. We have just been asked by the European Commission about our assessment or evaluation of those changes concerning Apple platform. We will definitely voice our feedback here. We believe that the legislation and the legislators in the U.S. are introducing certain changes which will affect us. Those changes will definitely persist in the future as well. We lowered the commission on Apple in the European Union from 30% to 24%, as I said before. This year, we started to advertise our store in the United States freely without any restrictions. However, other options that are on the table are not to our benefit. We decided not to use them. Moving on to the summary and the financial facts and figures.
First of all, we'd like to focus on a bigger picture because we're talking about quarter on quarter results. We're talking about quarter two, but we should also look at the year-to-date results or even a larger window. Obviously, the quarter on quarter results in terms of adjusted EBITDA and net profit have gone down a little bit. As we said before, this came from lower marketing spend in the middle of the quarter. We'll see the full effect of those lower payments. This will be visible in a second quarter. Invariably, we are generating solid results. We're generating strong cash flows. The adjusted EBITDA indicator went up 5% year on year and 18% or 18.5%, actually 7% in terms of net profit. Looking at our iterations and any changes in the games that we are introducing, we need a longer time for those effects to be visible.
What makes us really happy always is the fact that we are stable in our performance. We are able to manage this company in a safe way, in a secure way. We are able to generate strong cash and strong results. We're also able to share our profits with our shareholders. We're talking about a dividend of PLN 100 million. Looking at our entire company, our entire track record, we're talking about the total of PLN 485 million distributed to our shareholders. We do generate cash. We do hope that it will not change in the future. To summarize the quarter, in a nutshell, our performance explains our results. The falling bookings, mainly on the back of lower marketing spend, this was a deliberate decision. We do believe that in the reporting periods to come, these investments will be more fruitful over the longer term.
In terms of our operating expenses, the costs, everything is under control. We have a lot of cost discipline. It's very strong. We maintain it. Let me just remind you that the second quarter always has a bit of a higher cost of our employees' incentive program. We reported it in the second quarter because it was adopted in May 2025 only. However, these figures, these amounts are not very significant in terms of their impact on our financial results. At the level of adjusted EBITDA, we are closing the quarter at PLN 27 million, which is pretty comparable to the result we reported last year. Year on year, it is pretty flat, which makes us really happy. The net profit is at PLN 20 million. All in all, from the results perspective, a bottom line perspective, we're faring pretty well.
It's important to remember that the decreasing exchange rate of the U.S. dollar against the Polish złoty affects our reported cost of marketing. However, as an exporter, we are impacted by the exchange rate of the U.S. dollar against the Polish złoty. Another thing which has been disclosed in our report is the famous tax control. It has been extended until October this year. We are expecting further extensions. We are not likely to close this subject this year. It is outside of our control. All the files that we need to file with the tax office are immediately reviewed. We provide ongoing support to the tax auditor. We do cooperate with the office. However, we have no way of affecting the end date of the audit. A few words about our cash position. As you can see, our cash position is stable.
We are capable of financing everything from our own financial resources. There have been major outflows, which is a dividend, which is recorded in our cash flow. When it comes to investment activity, we can see earnout payment to former owners of Rortos. This is under our contract for the acquisition of this company. This year, we have paid earnout for 2024. A similar situation will be repeated next year. It will be the last part of earnout for 2025. This quarter, we have concluded with PLN 83.4 million in cash in our bank accounts. Everything's fine. Our business is stable. As far as more information goes, in the beginning of October, we are going to publish a report announcing preliminary revenue in Q3 as well as the final financial report, which is due on November 12th.
In the meantime, you might expect to hear from us in a product newsletter, which we have been sharing for some time now. In the newsletter, you will find more information on our progress on particular products and what to expect from them. As a company, we are going to be present at a few of incoming conferences. If you are capable of joining us, please be with us. There you'll have an opportunity to ask more questions, to inquire about our progress. The nearest such date falls on the 2nd of September, followed by October 9th and December 4th. All those of you who are interested are encouraged to subscribe to our newsletter, through which we will share with you latest updates, including links to our future conferences. I believe this will allow you to easier obtain information from the company, which are always verified and up to date.
Thank you so much. Now, I understand time has come to entertain the questions from the investors. Before this happens, I would like to leave you with a few important messages about Ten Square Games . Thanks to our precise measurements, we know how our games and products perform. We see that our strengthened product team is tackling every challenge head-on. We see how it is reflected in our products. We also know what works and what doesn't. We see a lot of potential for improving our results. We just need time. As you have seen, all these iterations have been balanced. We are planning to conclude them and translate them into our full population of players. We've had Wings of Heroes, which we started scaling in terms of marketing. Real Flight Simulator is increasing in scale. We are planning to add a Real Combat Simulator.
We are growing really big in the entire flight simulator segment. We have added an additional game with very good early KPIs, thus demonstrating that we know how to create new games, we know how to add depth to these games, and we know how to scale them. Ten Square Games has a full package. We have everything we need to grow and to achieve success. Having said that, I wish to conclude the official part of the presentation. Thank you for your attention. I wish to give the floor to Nina, who is going to read questions from the chat with the investors. Thank you so much for giving me the floor. The majority of these questions concern Trophy Hunter. Why don't we start with these questions?
Could you tell us a bit more about what percentage of revenue in Trophy Hunter comes from advertisements and what percentage of the payments from the revenue comes from payment bookings in the game? The market benchmark is more or less 20% advertising. In our case, it is slightly more than that. To be precise, it's around 25%. Still, it's a very immature product. It's just July and half of August. The dates are very early, and this product is going to stabilize later in the year. Obviously, it's going to be affected by marketing expenditure depending on each particular market. This will also fluctuate over months to come. Do the current expenditure on user acquisition exceed the revenue achieved by the game? We are not offering any comment on that. Could you tell us a bit more about the scale of revenue and marketing for this game?
What levels could we expect in August? We are not planning to comment on something which hasn't happened yet. August hasn't finished yet. We would like to leave something to comment on in the next quarter. We'll tell you more about that in a few months' time. What is your assessment of the risk of closing Trophy Hunter? Do you consider the game to be a 100% confident product and an element of the company's portfolio? As of now, we treat it as a safe bet. It's a sure shot. We know we will know with time. For now, it looks like a sure shot. What KPIs of Trophy Hunter are you happy with? Which of these areas do you believe could improve? It's hard to answer this question because this game has been on the market for seven weeks. Marketing hasn't started from day one.
As you know, we have still around four to five weeks' worth of data to collect. We don't know a lot. However, for the time being, we know that we need more content. That's for starters. The rest of the game looks exceptionally good. It has exceeded my expectations, to be honest. Are you planning to expand the team working on Trophy Hunter? What would be the scale of expansion? Are you planning to move employees from one project to another? Are you planning to hire some people externally? It all depends, as you might expect. Every team has what they need to achieve success. If we have our internal resources, we will use them. However, we know we might need some additional workforce because some people might not be simply with us. It all differs situation to situation. Still, our teams receive full support.
It's all about success, not about hiring two or three or four more people. There are some more questions flowing from the chat. Let us move now to Real Combat Simulator. When can we expect a global launch of the game? Rortos has a different style of working. They are never fixed on a particular deadline. Nothing has changed in this field. We do not want to impose our will on the team of Rortos. We wouldn't like to distort their style of working. Their job is to create the best possible product. This is what we are intending to achieve together. The next group of questions concerns marketing expenditure.
Let's start with a general question, not focusing on any particular game. I expect it applies to general marketing spend across the company, across the board.
To which level would you be willing to increase your marketing spend in current conditions, assuming that you have a satisfactory return on the acquired cohorts of players? We have never worked based on budgets. We always work based on rates of return. If it turns out that we need $1 million, we'll spend $1 million. If $10 million will be necessary, we'll spend $10 million. This is how we work. Coming back to the rates of return and the times for return, we can extend it. We can juggle it. We don't have a specific set limit. In fact, we would rather spend more and more, acquire more and more players at the cheapest price possible. We don't have any budgets, and we'll stick to it. This is our way, unless obviously we run out of cash because we spend so much on marketing.
If this problem appears, we'll talk about it. We'll handle it. Have you managed to increase marketing spend over the past weeks for your flagship titles? Should we expect any increases in marketing spend in the third quarter versus the previous quarter? As you saw, A/B tests are not concluded yet. The changes are still in progress. I wouldn't expect that. We wouldn't like to rush too much. Whether it happens a few weeks later or earlier does not have a major impact on our performance. We want these changes to be measured precisely. We want them to get tested thoroughly before we actually decide on any marketing spend. What would you expect? When will you go back to the scaling of marketing spend in Fishing Clash and Hunting Clash? How long could it take to test new features, segmentation, and monetization for these two games?
We winked at you a little bit here. We showed you how much time it takes, assuming that everything runs smoothly. You can imagine how long it will take. However, a bit of a disclaimer here. It doesn't always run smoothly. We managed to improve our segmentation in two segments, going up by 20%. It's a great, great achievement, more than expected. We outperformed our assumptions. What will it look like in the future? It's difficult to say at that point because the beauty of this business is the fact that players can always catch us by surprise with their erratic, sometimes erratic behavior. A couple of questions on your core products. Do you assume that in your core products, can you see any potential improvement already this year? Still, anything can happen. We're working in the... We have been working on a free-to-play business for years now.
The beauty of this business is the fact that you have to adapt your ways quickly. You have to react and think on your feet. You can expect everything. You can expect the unexpected. All the product work. We have been talking about a number of initiatives, but we have more. It may turn out that one of those major initiatives will become a huge success in the very first iteration. We will not need the second one at all. A lot can happen product-wise. What is really important and what makes us really happy is the new product know-how that we captured from the market, the new ways of work, the higher product standards because they are higher. We have raised the bar. The teams are working in a totally different standard, totally different manner.
We do hope that you will soon be able to enjoy the better performance and higher marketing spend with us. What would you do in a scenario if you do not manage to improve performance on your flagship titles? Honestly speaking, we do not see it happening at all. We do not allow for such a possibility. We see that we are doing very well in the first iteration. The segmentation is really effective. The team is thinking what to do if we have a performance that is not satisfactory in a given segment and the work brings fruit. We do not expect anything like that happening. We see how it changes. We see how our teams perform. We do not see such a risk on the horizon at all. Are you considering any reduction in headcounts in project or product teams? If so, when?
No, we are not talking about any reduction in headcount. July was a period of solid results reported for Wings of Heroes. Will you be increasing the marketing spend for this title in August? Again, no comment. A couple of questions from another area. One of our viewers wants to make sure whether data concerning Sensor Tower include TSG Store booking. Any platforms, Data AI, and others only show in-app bookings via Apple platform purchases and pay purchases. It doesn't include TSG Store or Apple. Another question. Did you see any changes in terms of the implementation of the privacy policy at Google? Nothing has happened since our last conference call. Do you see any new technologies that would allow you to create content and games more quickly? It depends what you mean if you're talking about new technologies.
Obviously, generative AI is growing as we speak and growing very fast. All the models that are used to create text, videos, and graphics. Obviously, these technologies will not allow us to replace people who create our games. We use those tools as aids. For instance, people did not have Photoshop in the past. After Photoshop appeared in the market, everybody uses Photoshop. Those generative AI tools are the tools that are being used heavily by everybody because they make our work easier but did not replace people. What is developing dynamically is the creation of video content because this is the element that is really important for us. We see a lot of progress here. The costs are there. They're pretty high. We're talking about $6 per each prompt. Not nice much, but we need a lot of prompts in order to make sure that something reasonable is created.
This is a considerable cost. We keep experimenting in terms of ad generation, graphics generation, the graphics and content that will be used in our games, and also code generation because we have a number of tools such as CourseOr [Cursor], which is used to support programming and development. These are the tools that we're using to make our work easier. We see signals from the market that companies are letting people go because of AI. Actually, they're not letting people go because of the AI developments. They do it because of the market. Obviously, this is a hot potato. Sometimes it shows a wrong and sends a wrong signal and creates a wrong picture. AI will help us to create relatively simple graphics but will not create an animal animation. They will not create an entire game. Again, it's a hot potato. There is a lot of fake news here.
A lot of companies are using AI as an excuse, saying that they are dismissing people. They are letting people go because of AI. That is not true. I would be very cautious with those comments because it's all fake. Some of them are fake news, actually. [Foreign Language]
The next question concerns strategy. Has anything changed in terms of potential acquisitions? As I've said, we operate on many fronts. We simply have not enough capacity to think about acquisitions, not to mention post-merger integration. We simply do not have enough time to think about it. Fishing, Hunting , Wings of Heroes, Trophy Hunter, Real Flight Combat Simulator. We have a lot of open subjects. This is what we are working on for now. Have you seen any measured impacts of employing specialists at the beginning of 2025?
As you've seen in the presentation, we are talking about changes in pacelifts. We can't say we have revitalized an entire feature, which has increased our pool of players by 20%. These are only fragments of what we do. We have assumed it might look like that. We are taking baby steps, especially in complex games. Our products are complex games. Segmentation is quite difficult. You would expect a system to work in every case in the same way, affect every player in the same way. However, in some segments, it equals zero. Understanding why it works on this segment but not on the other is what matters. That's the essence of our work on products: understanding the product, making the necessary adjustments, and trying again and again if necessary. We might have a series of failed iterations, five, six, or seven of them.
However, it's important for you to understand that there are hugely successful companies who perform best when they make a lot of changes in segmentation, for instance. There are a few financial questions. Have you got any plans concerning GameShare? We have an investment agreement, which we concluded a few years ago. This contract has specified a few investment windows. We do work with GameShare on a daily basis. However, as of now, we are not considering increasing our share in the company. There's also one question concerning the tax audit that you've mentioned. What period does it concern? What exactly? What numbers are in discussion? We always disclose this information in our financial report. However, it concerns our CIT for 2020. It concerns IP Box. Many companies didn't know how to calculate this relief.
After a few years, we knew we could, we were ready to use it to a full extent. We disclose a surplus of income tax. We have this cash on our bank accounts. However, the tax office has initiated an audit for 2022, and it concerns PLN 9 million. We corrected 2019 in the same way, so this audit might concern a longer period. In the next year, we have a surplus of PLN 3.3 million. We are talking about PLN 12.5 million in total. However, we have a tax provision so that we maintain the right amount of cash. We are talking in total around... let me do the math quick. In total, it's about PLN 23 million. This is our income tax provision. If the audit is positive, we are able to release this tax provision, and it will increase our net result.
We have this money on our accounts. Are you planning to pay dividends in the next year? It's far too soon to discuss it. However, allow me to remind you that we want to share our profit with our shareholders. Nothing has changed in our dividend policy. We are going to do it either by means of a dividend or buyback. It's far too soon to talk about it. We'd also like you to precise something on Real Flight Combat Simulator. The timeline, monetization assumptions, and plans for the game. Again, it's a subscription-based game. I would suggest you look at RFS on Sensor Tower and similar games. To cut a long story short, that's all. It's going to be a spin of Wings of Heroes, something in the type. We'll see how it performs. There isn't a similar product in the market.
Therefore, it's difficult for us to say what is the exact potential of the game. We know more about Real Flight Simulator. With time, I believe we'll know something more. When it comes to the deadline for a timeline, we are not pushing on Rortos. It's going to be ready when it's ready. That's the way it is. Nothing has changed in this respect. A few questions concerning Trophy Hunter. What is the maximum level to which you would be capable of increasing marketing expenditure, maintaining a satisfactory increase effect of the cohort? The longer the game is present in the market, the more we know about it. It's intentional that we do not spend four to five times more in marketing because we don't know how these cohorts are going to perform. We have some assumptions. These assumptions have been right so far on every stage of development.
What is great at Ten Square Games S.A. is that we have a high accuracy of prediction even before the product is present for a long time in the market. It usually overlaps with our calculations. The maximum marketing expenditure would be very hard to determine. With each passing month, we'll know more and we'll be able to discuss increasing our marketing expenditure as long as we run out of cash. Hopefully, we are not facing such problems in the future. Fingers crossed. Talking about cash, given initial data for Q3, could you also say something about revenue from Trophy Hunter? I understand we are talking about ESPI released at the beginning of the next quarter and we are planning to release such data. The launch of Trophy Hunter opens a new chapter in the history of the company. What is the potential of the game in global markets?
I don't know if you remember, but at some of the previous conferences, we talked about why we believe Wings of Heroes was our future, why some KPIs of Wings of Heroes were better than in the case of Fishing Clash or Hunting Clash. This is exactly the same story. How this game performs remains to be seen. No one knows that. We need for the revenue to be visible. However, the early KPIs are very satisfactory because they demonstrate we know how to create good games. We can create games that are better than their predecessors. It's usually a reverse trend because companies tend to follow a downgrading slope. We are basically doing it the other way. We are creating better games with every new title. We have proved that we can create a game with a lot of quality.
We have a team of experts who can deliver the best-looking product, which is appreciated by our players. Now we just need to follow this path and avoid making the mistakes our competitors have made working on their products. We strongly believe we know how to do it. We know we can follow the path of Ten Square Games. This has been the path that has brought us to where we are today. Allow us to wait a few more months. We'll be able to tell you a bit more. We'll see how the game performs in the longer perspective, how it's created, and what is the retention rate of its players. Now we need to do whatever we can to make sure this product is the best, as best as possible. We only need to make sure that our players remain with us for years to come.
Another question on the product. Where can we expect? If we can expect an update for RFS in this quarter still, quarter three, or maybe later on into the year, frankly speaking, I don't know. I cannot answer this question. I believe that we will come back with an answer later on. I don't have it in the back of my head, unfortunately. A more general question about the falling revenues. Is this an effect of a lower marketing spend, or rather an effect of the ever-evolving situation in the market, changing expectations of the players, or maybe other externalities? I would say that it is due mainly to the lower marketing spend because we have lower revenue in the first cohort and each month. They are overlapping. This is why we see a decline in revenues.
This is why we are struggling to make sure that those positive changes, those A/B tests actually are translated into some benefits. They are directed to a certain cohort population of the players. Yes, basically, it's due to marketing spending, which was reduced. A question on tax authorities and tax audit. Does the tax authority have any limit, any deadline to close these proceedings? It's been six years already. What can I say? Unfortunately, those proceedings are very lengthy in Poland. The tax audits are extended every quarter. There is an extension for the next three quarters. Everything is in accordance with the regulations. They can extend and prolong forever. Actually, let me go back to the RFS update, version 3.0. We have corrected certain errors in terms of this game. We believe that we have certain problems with the realistic imaging of the ground level.
I would take a cautious approach here. A strategic question concerning M&As. A few expect potential M&As in the future. Do you actually assume such a long-term earnout just in the case as it happened when in Rortos? It will depend on the market situation. It is difficult to say whether we will have actually any acquisitions in the future. All scenarios are on the table. We will obviously pick the scenario that will be the most beneficial. It is difficult to discuss it because we haven't discussed it with anybody yet. We haven't started any negotiations. It is difficult actually to refer to such questions at this point. A question on TSG Store, which is growing dynamically. What are your next steps in order to tap into it, in order to increase the margins and become more independent of the platforms? We are testing booking providers.
We're just testing the new one in order to optimize the margins. If we're talking about margins, we do not see any major fluctuations. We do not expect them. We are looking at the regulatory environment. We are keeping a watchful eye on what is going on in the EU and the United States. We are tapping into every opportunity that emerges. We're talking about work related to the offer of the TSG Store. Our basic observation is as follows. For a player to actually consider using a store, the players need to have any added value. The secret is actually to create an added value. We're not talking about promotions like 80%. This will actually disrupt the economy of the game over the long term.
The trick is to balance it and we're doing our best in order to make sure that the offering in the store is attractive to the players. At the same time, it will not disrupt our game and its economy. A question on your strategy. Do you plan to revise your strategy within any timeline? Actually, it is being verified. It is analyzed as we speak. We can analyze the changes that we see, whether they're positive or negative. It is an ongoing verification of the strategy. It's not that we have fixed points at which we can decide whether or not a game should be continued or dropped. We are verifying our performance on an ongoing basis. If something is not working, we will drop it. If it works, we'll continue it.
This is what it looks like as a day in, day out work, month in, month out, week in, week out. It's not that we have set deadlines to meet, for instance, after 14 days to discuss our performance. Everybody has their own opinion. We're looking at the data. We are trying to pin down whether or not something works, whether or not it brings benefits, brings fruits. If we are testing a big new feature based on the cohort of 5% of our players, then the impact on our overall performance will not be noticeable. We cannot test it for 100% of our population of players because the risk would be too big. We are talking about a living organism. If we omit or skip one or two elements, the whole economy of the game could blow up.
We need to make sure that we are proceeding in a stable manner to make sure that a change, any change, actually can be translated into a success. Let me remind you, if a game change is effective on the most so-called calorific, promising players, we're talking about players from the United States, from other countries, just European countries. We're talking about tier two and tier three markets that can, and we can trickle it down in this way. This is why we have a cautious approach. Six months have passed. It's not that we have been working and tweaking something for six months. We spent two or three months at the very beginning in order to make sure that the team is ready and able to work in a different way according to different requirements.
Somebody had been working in a totally different standard, totally different manner than he or she, or they need some time to readjust themselves. We're not talking about product team only. We're talking about R&D, the marketing, any customer support teams, and so on. These standards have been revamped. They have changed across the board throughout the organization. The change that we are talking about takes time. We are not replacing a single element, or we're not revamping a single method of work. We are reconstructing and rebuilding the entire way of working across the organization. Thank you very much. We have a couple of questions. However, I cannot hear the speaker. Yes, the question was about the return to the growth path. It depends. The answer is it depends. I want to give you specific examples, such as in the case of segmentation.
Each of those tests takes about six to eight weeks. It worked for a single segment. The uplift was noticed in the first segment. It could have been noticed on four segments. It's difficult to say whether we achieve that in the coming six, ten, fourteen weeks because we don't know, honestly speaking, how players will react. We can assume that we will have an uplift of 5% or 15%. It does happen that we are caught by surprise by players' behavior. It did happen in the case of segmentation that the lowest segment, the lowest paying segment, actually showed such increases. Honestly speaking, we had assumed that it would be easier to change player behavior in higher segments, higher paying segments because it usually happens like that. They react to changes quickly, more quickly than lower paying players. It's difficult to say what it will look like.
We are at the third stage of the segmentation. Maybe we'll have three or four or maybe five. It's difficult to say whether we'll close this process in a month or two or in 14 months, for instance. This is the problem where the problem comes from, players' behavior. [Foreign language]
This is exactly why we can't say when it's going to happen precisely. We are impatient, just as you are. We want to know we're here and now. We want to increase our revenue from day one. Believe me. What is your assessment of your competitive advantage in this hobby segment of games? We have a very good position. We have the biggest fishing game.
Third, fourth, biggest hunting game, Wings of Heroes, is doing great compared to its competitors, especially where games in similar segments are simply abandoned by our competitors because they can't maintain the pace of growth. We, in reverse, are increasing our expenditure of Wings of Heroes. RFS is doing equally well. Our position is very robust. We're happy with the fact that we are capable of acquiring new employees from the market. We are testing new ideas. There are still so many things we didn't know we could improve that we are discovering now. All that has improved our potential. We are very hopeful about the future. There is a question concerning one product by GameShare. Cooking Wars. Do you know any KPIs for this project? It's a very fresh product. Trophy Hunter has been with us for seven weeks. We have already told you we know nothing about it.
Cooking Wars is even less mature, so we have no data to discuss. There are a few more questions we have received before the conference. We are rather limited in time. We are going to brush over them quite quickly. There is one question concerning the company's strategy, as well as some framework, activity, or plan of working. I believe this has been clarified by the Management Board already. We know what the plan is. We know how much time we need to perform A/B tests. However, let's move on to the questions which haven't been repeated yet. Is the company planning to release new titles? Always. However, as I've already said, now we are working on what we have at the moment in our portfolio. We are going to think about new projects, especially given that we have been emboldened by Wings of Heroes and Trophy Hunter.
These are our most promising products. Have you identified any offers for acquisition? Is the company still hungry for acquisitions? We are always hungry for acquisitions, but we have no resources to work with. At the moment, it's all hands on desks, working on the games that we are currently developing. We do believe in the force of concentration. We don't want to spread ourselves too thin over too many products because we might start considering whether a particular strategy works or doesn't work. We want one person to work on one or two things tops, and we want to deliver what we have committed to. As soon as we have delivered, we are going to think about our next steps. When it comes to GameShare, we have talked about the schedule of reversing the trend in terms of payments.
There is one more question concerning games from the evergreen segment, Wild Hunt and Let's Fish. Is it the end of these games because they haven't performed too well? Again, we have a team working on the portfolio of evergreen. We update content in these games. Sometimes we add new features to them. Indeed, we do not develop these games so aggressively. The evergreen segments are beautiful products, and this is the reason why we keep them. [Foreign language] . Again, some of our players want to play Let's Fish only. Players are fans of Wild Hunt. Still, these games allow us to test certain solutions in a safer environment. [Foreign language].
Therefore, allow me to repeat that these games, although they might be small, they are very profitable, and we are happy to have them. [Foreign language]
Do you have any roadmap for developing Trophy Hunter and other titles for the next year, or are you planning month to month when it comes to development? We have so-called North Stars for every product. We have roadmaps for a longer perspective, longer than three to six months. Still, we are not working on three, five, or fifteen year roadmaps as in Airbus. The market changes too rapidly for us to be able to be locked on a three or five year plan. [Foreign language]
Yes, we are working on the long-term perspective. Yes, there are some elements we want to improve with every feature. We are testing whether our changes are effective, but we are not Airbus. We do not have 10 to 15 years roadmaps. One more question. This question concerns the valuation of the company. Again, it's at the lowest level in history. It's around PLN 500 million. Do you believe that the payment of a high dividend was a good decision in the context of your shareholders and increasing the value of the company? It's a somewhat philosophical question. We believe that if we have cash available and we can finance our operation from our own resources, we wish to share it with our shareholders. I understand somebody didn't want to receive that money, sorry for that, but we do not need to rely on external creditors.
We do whatever we want and we don't think that the payment of dividend prevented us to make some investment decision because we are short of cash. No, this wasn't the case. What we had to do, we did right. We had an alternative of keeping it in our bank account. You need to assess what's better. It's a very profitable deposit, as you might believe, of 5% a year. We have run out of time. I believe that we have addressed the majority of questions concerning the company strategy as well as the current progress on our projects, which is why we are going to conclude the meeting. Should you have any more questions, please send them to us directly. We'll be very happy to respond to all of them. Thank you for being with us and see you at the next.