TLDR
- Embracer Group stock jumped as much as 19.5% after beating net sales expectations of SEK 3.94 billion vs consensus of SEK 3.61 billion
- Cash EBIT swung to SEK 47 million from a loss of SEK 99 million a year earlier
- PC/Console sales rose 68%, driven by Gothic 1 Remake selling 500,000 copies in its first week
- Adjusted operating profit hit SEK 151 million, more than double the SEK 69 million consensus
- Embracer maintained its full-year Cash EBIT forecast of at least SEK 1 billion for 2026/27
Embracer Group posted a strong first quarter on Thursday, beating net sales expectations with SEK 3.94 billion against a consensus of SEK 3.61 billion. The stock jumped as much as 19.5% on the news, settling around 7-9% higher by mid-session.
Embracer Group AB (publ), THQQF
Total net sales rose 24% year over year, with organic growth coming in at 33%. The Embracer operating segment did the heavy lifting, with Entertainment & Services and PC/Console leading the way.
Gothic 1 Remake was the standout performer. The title sold 500,000 copies in its first week, pushing PC/Console net sales to SEK 728 million from SEK 433 million a year earlier. New-release sales in that segment jumped to SEK 310 million from just SEK 69 million.
🚨 Embracer Group Q1 FY26/27 Earnings
Profit tops expectations…
but PC/console recovery is the real story 👀
📊 KEY METRICS (Q1 FY26/27)
🔹 Net Sales: SEK 3,943M (+24.3% YoY) 🟢
🔹 Organic Growth: +33% 🟢
🔹 Adjusted EBIT: SEK 151M (vs SEK 18M; consensus ~66) 🟢 More than… pic.twitter.com/rANgeUrYtn— Emmanuel – Big Tech & AI Investor (@EmmanuelInvest) August 13, 2026
CEO Phil Rogers told Reuters the restructuring work is essentially done. “The groundwork we feel is done,” he said, referring to changes made over the past four to five quarters.
Cash EBIT swung to a positive SEK 47 million from a loss of SEK 99 million in the same period last year. The turnaround was driven by stronger sales, better gross profit growth, and lower capital expenditure within the Embracer segment.
Profitability Still Mixed
Not everything was a clean beat. EBIT came in at a loss of SEK 79 million against a consensus expectation of a SEK 80 million profit. EBITDA of SEK 697 million also missed the SEK 871 million consensus.
Adjusted EBIT of SEK 151 million fell short of the SEK 248 million consensus, though it was more than double the company-compiled estimate of SEK 69 million. Cash EBIT of SEK 47 million missed the SEK 129 million consensus.
EPS of SEK 0.18 beat the SEK 0.08 consensus. Adjusted EPS of SEK 1.04 also topped the SEK 0.80 consensus.
Free cash flow after working capital was SEK 3 million, compared with negative SEK 383 million a year earlier.
What’s Coming Next
Embracer maintained its full-year Cash EBIT outlook of at least SEK 1 billion for fiscal 2026/27. The company said its confidence in hitting that target increased following the Q1 results.
Earnings remain back-half weighted. Metro 2039 and Tomb Raider: Legacy of Atlantis are both scheduled for February 2027. Rogers said the full-year target remains achievable even if either title is delayed.
Entertainment & Services revenue rose to SEK 1.768 billion from SEK 967 million, helped by new releases and strong catalogue sales at PLAION Partners.
Redeye analysts noted the quarter was stronger than expected, with both the Fellowship segment and the remaining Embracer business beating their Cash EBIT forecasts.
The planned spin-off of Fellowship Entertainment remains on track for calendar 2027. Embracer also has an active share buyback programme of up to SEK 750 million running until March 31, 2027.
Profit before tax of SEK 69 million beat the SEK 50 million consensus, while net profit of SEK 39 million came in just below the SEK 44 million consensus.
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