Realms of Ruin game on screen
Sales of Warhammer Age of Sigmar: Realms of Ruin disappointed over the Black Friday period / Image source: Adobe
  • 2024 sales guidance slashed
  • Firm sees ‘at least break even’ in FY25
  • Robust cash balance provides reassurance

Shares in Frontier Developments (FDEV:AIM) slumped 21% to 155.6p after the embattled video games developer posted yet another profit warning, pinning the blame on disappointing sales of its recently-released Warhammer Age of Sigmar: Realms of Ruin title over the critical Black Friday period.

Due to lower-than-expected initial Realms of Ruin sales, the Cambridge-based games publisher downgraded its full year 2024 sales guidance from ‘around £108 million’ to between £80 million and £95 million.

At the mid-point this implies a 20% downgrade, although the outcome hinges on sales across Frontier Development’s games portfolio during the remainder of the financial year to next May.


Hot on the heels of an alert from rival developer Team17 (TM17:AIM), Frontier Developments conceded early sales of Realms of Ruin were lower than expected, though it expected sales to build over time, drawing confidence from the ‘mostly positive reviews’ received at launch from game critics and players alike.

Frontier Developments also stressed it would continue to support Realms of Ruin with post-release content including paid-downloadable content.

The beleaguered firm believes the full-year 2024 adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) loss of around £9 million the market is looking for ‘remains achievable’ if sales come in towards the upper end of revenue guidance, thanks to cost savings and improved gross margins.

However, if sales come in at the lower end of guidance that loss would be close to £20 million.

Management expects Frontier, which had cash of £20.5 million in the coffers at the last count, to ‘at least break even’ in full-year 2025 through the ongoing performance of its existing games portfolio, revenue contributions from future releases and cost savings’.


Frontier Developments’ management conceded that forays outside of core Creative Management Simulation (CMS) games into ‘adjacent’ genres and third party publishing have disappointed.

As such, the company is adjusting strategic direction to focus solely on CMS, an area in which it has a proven track record, and aims to deliver three new CMS titles over the next three years.

Frontier Developments stressed that its four CMS games (Planet Coaster, Planet Zoo, Jurassic World Evolution and Jurassic World Evolution 2) continue to perform well and have each achieved over $100 million of gross revenue with a combined total of over $500 million.


AJ Bell investment director Russ Mould said: ‘The market has lost count of the number of profit warnings issued by gaming group Frontier Developments in recent years, and true to form along comes another one.

‘Possibly the unluckiest company on the London Stock Exchange, demand for its latest game is below expectations.’

Mould added: ‘Perhaps management hasn’t got the memo that it is better to under-promise and over-deliver than to set the bar too high from the start.’

DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (James Crux) and the editor (Ian Conway) own shares in AJ Bell.


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Issue Date: 27 Nov 2023