Investing in $PDX (+0 %) Paradox Interactive: Future Growth or Continued Decline?

Hi everyone,

I'm interested in discussing Paradox Interactive and its current stock situation.

Recent Performance Highlights:

Q1 2024: Revenues were steady at MSEK 482.1, with a slight decrease in operating profit. Cash flow from operating activities decreased, but the cash position remains strong.

Key Releases: The quarter saw new DLCs and game releases, including "Millennia" and several DLCs for existing titles.

CEO's Comment: Fredrik Wester highlighted strong underlying sales and a solid cash position, providing a good foundation in a turbulent games market.

My Thoughts:

Cities Skylines 2 Recovery: Despite a poor launch, there's potential for recovery with more frequent DLC releases and increased console adoption.

Major Driver - EU5 Release: The upcoming release of Europa Universalis 5 (EU5) is expected to significantly boost revenue.

Europa Universalis IV Performance:

Active Players: Currently 9,410 active players with a 24-hour peak of 19,053.

Positive Reviews: 87.1% positive reviews.

Revenue and Sales: Gross revenue of $76.2 million with 3.2 million units sold.

Engagement: Average playtime of 286.8 hours and a median playtime of 24.8 hours.

This strong performance for EU4 could indicates potential revenue growth for EU5 (2025 onwards) as well as other new releases this year through steady revenue from DLCs.

Challenges: The mishandled launch of Cities Skylines 2 and the delay of some game releases to 2025 have hurt the stock price.

Has anyone else looked into $PDX (+0 %) or has knowledge in the gaming industry stocks? I'd appreciate any insights or advice!

*Disclaimer: I do not own any stock in $PDX (+0 %)*

Thanks! :)

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https://www.paradoxinteractive.com/investors/financial-reports/interim-report-january-march-2024

https://steamcommunity.com/app/949230/discussions/0/4202490257585483712/

https://vginsights.com/game/236850

https://m.investing.com/news/company-news/barclays-starts-paradox-interactive-stock-with-underweight-rating-93CH-3473111?ampMode=1

Soprano@Soprano

7Mo

I own many stocks of PDX and I still like it. It transitions from being a growth stock to a value stock since all the growth ventures failed. However there are strong numbers and great FCF for the business looking forward. Also the gaming market is currently in general performing weak so that also explains why the stock is down bad.

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8Mo

Le commentaire a été supprimé

mvarcox@mvarcox

Thanks for the insights! Of course, it's not a crazy growth play, as you mentioned. It just sounded like a decent mid-term trade option with the large niche user base if they could fix the current problems with Cities Skylines 2, add DLCs, and launch other big game names.

@PowerWordChill Yeah but because it’s a niche there is basically no competition. Fans of grand-strategy can’t find a way around Paradox. Even though TAM is smaller than Fortnite there is less competition in the specific genre. It’s sad that their ventures failed but the current OG titles still have solid player engagement and therefore generate decent FCF.

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