Daniel Hasselberg: Hello, welcome to the presentation of MAG's Q4 Report. Here to talk to you today is me, Daniel Hasselberg, I am the CEO.
Magnus Wiklander: And me, Magnus, the CFO.
Daniel Hasselberg: Since the Q4 is going to be both going through the last quarter, but also concluding the full financial year. Let's take a look at some of the highlights, if we can get the slide going here. I think the biggest thing to talk about for the full year is the ARPDAU improvement. The average revenue per daily user is up by 21%. That really speaks volume to what we were able to do with all of the live games. It is an improvement across many of the games in the portfolio that have these end results. In terms of revenue and profit, it is basically flat year-over-year.
Daniel Hasselberg: We are up 4% measured in dollar, down 4% measured in Swedish krona, and we have gone from a small loss to a small profit. Basically no big action there. What we are really excited about is the platform expansion. This year we have taken two of our most important games out on the platforms. Both Crozzle and Wordzee are now live, which means that the platform has real feature completeness in the sense that we can take two of our biggest games and run on the platform. Big news for us compared to a year ago. If we zoom in on Q4 specifically compared to Q4 last year, it is a lot about comparing a launch quarter to a non-launch quarter. We scaled up Crozzle last Q4, SEK 34 million in UA. I think the biggest UA quarter ever for us.
Daniel Hasselberg: We found tons of really great volume, high quality and high volumes. This Q4, only SEK 13 million in UA, and that is the difference you see then in both top-line revenues down 17%, but also the results bouncing back from a negative to a positive result. This is a UA impact we always see when it is big fluctuations, and this is maybe bigger than normal when you have a launch quarter the year before. What we also see if we compare last year to this year, a much higher pace in the new games development. I am going to talk a bit about that later, but really massive difference in 12 months. Before we go into talking about financial KPIs and so on, we want to highlight a few product developments. One is the most requested and highly anticipated feature in Crozzle, that is friend games.
Daniel Hasselberg: Now in addition to play these kind of fast-paced crossword games, you can also invite your friends and play asynchronous games with any friend you want to, and this is exciting for multiple reasons. One, as I mentioned, it has been really highly requested by our players, but also that we have seen in our evergreen games like Ruzzle, QuizDuel, Wordzee. People who play the game for many years tend to build this social network of friends in the game over time, and that keeps them in the game. That journey starts now for Crozzle, with building up relationships, making friends, or inviting friends to the game. We see this can help in both driving organic traffic and also build this solid network. There is a bunch of more stuff coming in the game.
Daniel Hasselberg: Now, this launched about 2 weeks ago, and there is more stuff coming in terms of making it easier to find friends, invite friends, and compete together with friends in the game. Super exciting for Crozzle and also for QuizDuel, our biggest game. We have a new big feature in the game, lots of new content, new ways to play that you have not seen before in QuizDuel. Also, this game mode is not on a timer, so this is what the team talks about, a kind of Netflix-compatible gaming. No pressure, you can do something else and play the game at the same time. This is the biggest new trivia feature in the game we have launched since Weekly Leagues, and if you follow us and QuizDuel, you know that that has been a big driver of growth for the game.
Daniel Hasselberg: We are really excited about this. It test-launched in Italy last week. It is now available in Sweden and a few other markets, and the aim is for next week to be the big kind of rollout in the German-speaking markets, which is the biggest part for QuizDuel. Very exciting to see this out in the wild after a lot of really hard work from the team. Yes, and I want to talk a bit about our platform. As you have heard us talk about for the last couple of years, we are moving more and more towards being a platform-based games company. We want to have all our games on the same platform so we can build a feature once and roll it out across all of the games. When we improve a feature in one game, have it easily transferable to all the other games.
Daniel Hasselberg: Building a feature once and rolling it out across a bunch of products, of course, gets the average time and the average cost per feature down. We really see us becoming much faster to market with new features, and also when we make a new game, getting it to feature complete state much quicker. The aim here is, of course, get higher LTV for each player, which can unlock then more UA potential and grow the size of our business. Our financial goal is to get to SEK 500 million of yearly revenues, and we see that that could unlock a 20% EBIT margin. That is kind of the goals we are building towards here, and we think the platform is a hugely important piece in that strategy. Here are some examples of when we build things that are kind of game agnostic.
Daniel Hasselberg: A feature you can run in basically any game, it does not have anything to do with the game mechanics of that specific game. Things like daily missions for the player to do during a daily session or a full day of gameplay, or season pass or different types of events. Next week, the season pass premieres in Wordzee, and that is going to then go live in Crozzle. We have an album collection feature that is about to go live in Crozzle that will also then go live in Wordzee. You are going to see this in the coming months how being on the same platform really benefits multiple games. Then, of course, moving more and more games to the platform makes it even more powerful.
Daniel Hasselberg: And for the operations side of things, the same platform and same services beneath really makes it more easy to optimize economies and transfer learnings between games. That is also a very important piece of this.
Magnus Wiklander: So with that, we take our usual look at the product mix and portfolio. On the right-hand side, we have our older games where the focus is on long-term, long-tail stable revenues. After a period of some movements last year in both currency and divestments, et cetera, we are now in a year or so of very stable numbers in this part of the portfolio. The new story, I guess it is connected to our platform where we are busy porting the key games in this part, the older games, onto our platform to create further stability and long-term revenues, but also make it easier to work with the games and maintain them. And to, in some cases, maybe unlock more potential through the features we have in the platform and maybe even put one or two of these to new life on the platform going forward. Super exciting.
Daniel Hasselberg: Of course, we have our main growth games up in the left corner here with QuizDuel, Wordzee, and Crozzle, which these are the games we support with UA and where we see growth potential primarily, even though, as you say, maybe some of the older games will also get new life and can join that kind of growth momentum. Of course, very exciting now is the new games. As I mentioned earlier, the pace of new game development is so much higher now than a year ago. This is a combination of course, the AI capabilities have been so much advanced over the last 12 months.
Daniel Hasselberg: Prototyping is something you can prototype a game in a matter of hours. Ideas become playables very quickly, but also we have a way to take them out to market for real testing much, much faster. These are games where we talk about new games, it is not kind of AI prototype testing locally, it is like games out in the wild with real UA analytics and something we can base decisions on. Then where we have the platform makes it much easier to go from a promising or proven core to a fully featured game as all the features are already available in the platform. We are super excited about this. We had, I think I mentioned last quarter that we aim to go from 4 to 6 game tests per year to the same amount per quarter, and we managed to do that in Q4.
Daniel Hasselberg: We had 6 games in market testing in Q4, and we are keeping the same pace in Q1. This 6-month period will probably be 10 to 12 new games in testing, so a pace we have never seen before. Of course, we really hope that some of those games will make it up to the growth part of this picture and kind of help grow top-line revenue and later on profits for MAG.
Magnus Wiklander: Okay, our audience KPIs starting off with the user acquisition, which is a headline number to understand the quarter, as already mentioned, going from 34 down to 13 in the quarter. 13 then for us is roughly maintenance level UA enough to support the business but not grow it.
Magnus Wiklander: The change will then affect some of the numbers, less so DAU due to the lower number of users in the UA we did a year ago. For ARPDAU, a year ago, we had a boost from the UA we talked about, but we also talked about portfolio-wide improvements of the key games, live games. This year, we have much less of the UA boost, but we continue to see the improvements we make in the portfolio, and we land at 9.1 cent, which is historically high and is also in line with the yearly average, which is the highest we've seen at MAG so far. For the financial KPIs, we see further UA effects with net sales coming in at SEK 64, down from SEK 77.
Magnus Wiklander: With the same currency rate more or less throughout the year, we see a similar movement in the USD version of net sales. On the EBITDA, we bounce back to SEK 19 million, based on the lower UA, and we expect to see those levels when we are at the maintenance level of marketing. We end the quarter at SEK 85 million bank balance. Growth engines, this is where we look at the numbers and operations through the lens of growth mechanisms. In the expansion of portfolio, we talked about the high pace in the new game department with more games than ever, more new games than ever, and tested with real users in market. UA is a disappointment at the maintenance level, maintaining the business, not growing.
Magnus Wiklander: The ARPDAU levels we are at is a testament to the ongoing work we do with the live games and improving both ARPDAU and long-term LTV for our audience.
Daniel Hasselberg: Yeah, if we wrap it up and look a bit into the future, both right now, halfway into Q1, but also beyond, as I talked about the cross-sell friend games, it is really an exciting step for the game to also become a more social game where we can have these long-term bonds with your friends and people you meet in the game. In general, I would say, the pace of development throughout the company, across all departments and all the games is extremely high, and we are super excited about seeing the pace of development.
Daniel Hasselberg: The roadmaps look very exciting for the games, and we look forward to seeing how the players react to all the stuff that we are building, and of course, to see that have an impact on the business turning more engagement and time into better revenues and profits on a company level. The new game mode in QuizDuel, as I said, the biggest trivia game mode we have done in a long while, and I think very exciting for the players to get something really new to look at and play with, and hopefully come back in Q1 and talk about the results of that new game mode. That is a wrap, I guess, for this report presentation. We are going to see if we have any questions coming in now.
Daniel Hasselberg: Otherwise, as always, throughout the day, we are available on our X and Bluesky channels to respond to any questions you might have throughout the day. We have one question here. How did you manage to get ARPDAU to increase steadily into the summer months? Is QuizDuel driving this? QuizDuel had a really good summer, and I think we talked about this in the Q3 report when we presented it in June, that we were just rolling out a new version of the Blaster side game in QuizDuel. This is a puzzle-style game with a blast mechanic, and we completely remade that, both in terms of what it looks and how it plays, but also added a lot of functionality to it, supporting more win streaks and meta-game progression and events around the Blaster.
Daniel Hasselberg: That really helped boost both time and revenue from that game. That is really a big part of why ARPDAU developed so well throughout what is normally our lowest quarter in terms of seasonality. Really exciting to get that out, and it helped our Q4 for sure. I think that is it in terms of questions live. As I mentioned, we will answer any questions online, and thank you for watching. Thank you.
