Source: Inderes

Starbreeze will publish its Q2 report on Thursday, 20 Aug. We expect a marked year-on-year decline in both revenue and profitability, largely reflecting the KRAFTON wind-down and still-subdued PD3 monetization. We will look particularly for management's commentary on the PAYDAY crossover in PUBG, the new Crimebonds system, and the overall IP expansion strategy.

Broad-based PAYDAY softness expected to drive top-line decline

We estimate Q2 revenue at 33 MSEK (Q2'25: 54 MSEK), representing a 39% decrease year-on-year. A meaningful part of the decline reflects lower work-for-hire revenue as the KRAFTON partnership winds down, while the core PAYDAY franchise (Inderes estimate: 26 MSEK) remains, in our view, the key swing factor. We find it encouraging that engagement itself improved on Steam through the quarter, with peak activity (concurrent users, CCU) roughly doubling from the early-2026 lows around the mid-May and late-June content updates and the PUBG crossover. We would caution, however, that the absolute level of players remains very low, representing a small fraction of PD3's launch levels, and that the gains were also driven by free content and seasonal discounting rather than clearly monetized activity. We would also note that Steam captures only part of PD3's player base, and that the more relevant signal is the step-up in the retained baseline rather than the transient peaks. We therefore treat the engagement recovery as a necessary but not yet sufficient condition for a larger revenue inflection. We expect PD3 revenue to remain low in absolute terms (Inderes: 13 MSEK, -26% y/y) but to improve sequentially (+~30% q/q) due to the Q2 content cadence and crossover. However, we would read any such uplift as largely promotional rather than evidence of a durable monetization inflection. We also anticipate PAYDAY 2 ("PD2") to remain softer than the run-rate seen in recent quarters following the introduction of the subscription model in Q3'25. However, we expect continued investment and game updates to gradually improve the top line quarter-on-quarter (Q2'26e: 12 MSEK, Q1'26: 11 MSEK).

Elevated amortization weighs on profitability despite cost actions

We expect Q2 EBIT to come in at -32 MSEK (Q2'25: -17 MSEK). The year-on-year deterioration is expected to be mainly driven by the lower expected revenue base and elevated game amortization, which surprised to the upside in Q1 (49 MSEK vs. our 28 MSEK estimate) and which we have carried forward at a higher level. On the cost side, we expect the rightsizing measures initiated in Q4'25 to continue to feed through. Management has previously noted that the full effect of these changes will be visible from Q3 onwards. On this basis, we estimate that EBITDA will remain slightly positive at 4 MSEK (Q2'25: 6 MSEK), indicating that the underlying operating expense trajectory is adjusting to the lower revenue environment.

Focus on cash flow sustainability as the IP expansion strategy accelerates

Our primary focus in the Q2 report is progress toward positive cash flow in 2026. With the cash balance at 75 MSEK at the end of Q1'26 and continued own-game investment keeping free cash flow firmly negative (Q1'26 FCF: -25 MSEK), we see the path to the 2026 target as increasingly tight and will watch quarterly cash development closely to evaluate balance-sheet risk. We believe the full effect of the cost measures from Q3, combined with a stabilization in PD3 monetization, will be critical to bridge the gap.

Stepping back, we view the recent news as a deliberate effort by the company to evolve PAYDAY from a single game into a broader, multi-platform entertainment IP via two tracks. Regarding the first track, improving the monetization of the user base, we note that the late-Q2 Crimebonds unlock and store framework is one step toward deepening as well as monetizing the core game. Initially, it repackages existing content, but it is built to deliver both free and paid content over time. We see it as the monetization rail for converting a larger engaged base into recurring revenue, and any commentary on the paid roll-out timeline would be informative. The second track, about widening the upper funnel and extending the brand, we note several efforts: the PUBG crossover (May), the native Fortnite (UEFN) launch in August*, earlier VR and Roblox titles, and the VICE Studios screen adaptation (which added Curtis "50 Cent" Jackson and G-Unit Film & Television as executive producers on 10 August). We will look for management's assessment of the PUBG crossover's reception, as it is the most recent test of the brand's ability to acquire new players, and we will monitor whether any engagement uplift proves durable.

Strategically, we see this development as a coherent, capital-light way for a single-IP company to defend and grow brand equity. However, we keep reach and revenue separate as the platform partnerships are partner-funded with no disclosed economics, and the screen adaptation is still in the option stage. For example, the successful Notoriety Roblox title illustrates this dynamic, contributing to the reported 4 MSEK of licensing revenue in 2025 despite 400m+ visits, so the direct contribution is immaterial, and the value is more top-of-funnel brand reach rather than a near-term revenue line. The payoff must therefore show up indirectly, in sustained activity and monetization in the core games, which we have not yet seen, and may take some time. While we view the direction positively, the near-term case hinges almost entirely on a turnaround of the PAYDAY franchise, in order to ease the cash flow pressure. We remain cautious until there is tangible evidence of notably improved player sentiment and activity, as well as sustained monetization.

*Developed and published with the Stockholm-based creative team OceanWave Games (operating as OCWG)