Swedish games publisher, NetEnt, suffered its worst quarter since going public two years ago, thanks to regulatory tightening in several European markets, and Australia.
The trading update mid-January, revealed that revenues for the fourth quarter were expected to “lag behind market forecasts” – with revenues coming in at around SEK419m, some way below the Q4 target of SEK447m. Earnings were revised down by SEK20m, below an expected SEK170m.
The games company said underlying growth in several different markets had been lower than expected but most of the downturn came from Australia, Poland and Czech Republic where new regulations had forced it to “phase-out” delivery of its games to local clients.
The lower than expected period represents the first in NetEnt’s bullish history since being listed on the Stockholm exchange – sending its share price tumbling by 20 percent on the morning of the announcement.
The company said it had “continued to generate a solid cash flow” in Q4, and promised the dividend for the year will be “at least in line” with 2016.