everplay Bets on AI and Back Catalog Resilience as New CEO Charts Course

everplay group plc (EVPL.L) delivered its full-year 2025 results on 31 March 2026, marking the first report under new CEO Mikkel Weider, who took the helm just three months prior. The headline numbers show revenue flat at £166M, but adjusted for the exit from physical distribution, growth of 5% and a 29% adjusted EBITDA margin that expanded 3.1 percentage points. More than the numbers, the call signaled a deliberate strategic pivot: an aggressive embrace of AI, a sharper focus on owned IP, and a disciplined approach to capital allocation against a backdrop of a 'pretty weak' share price.

The AI Strategic Pivot

Weider, who founded Nordisk Games and led it to 1,300 employees, immediately put AI at the center of his growth thesis. In his prepared remarks he said, “I want us to become stronger in tech and AI” — Mikkel Weider, CEO · 2026-03-31, and detailed existing use cases: StoryToys is generating 40,000 lines of code per month via AI, and AI is used in QA for performance testing. The company has an AI council and tools for all employees. In Q&A, he expanded on the competitive moat:

I actually think AI will result in a greater demand for publishers like us, someone who can help developers games to stand out in the crowd. With more games being launched, discoverability will definitely be key onwards.

This is a company-unique angle — not just adopting AI internally, but positioning as the professional aggregator in a world where AI floods the market with content. The AI in engineering and AI in QA efforts are being scaled across the group, and Weider is explicit that AI will allow more and richer games without adding headcount, a key margin lever.

Diverging division performance

The portfolio tells a story of contrasting fortunes. Team17, the largest division, delivered record revenue of £106M (up 8%) and 20 million units sold, with new release revenue up 700% on the back of hits like Date Everything!. astragon was the laggard, with revenue down 33% (or 18% ex-physical distribution), dragged by poor launches of Seafarer and Firefighting Simulator. StoryToys shone, growing 25% to £30.4M, with 376,000 active subscribers and major partnerships with Netflix and Apple.

CFO Rashid Varachia noted that despite the mix, “group revenues were broadly flat year-on-year at GBP 166 million, but excluding the physical distribution... they were 5% up year-on-year” — Rashid Varachia, CFO · 2026-03-31. The physical distribution exit was strategic — it improved gross margins by 4.4 points to 46% and reduced complexity, even as it cost top-line growth. astragon is expected to 'bounce back' with more content and a streamlined cost structure.

Back catalog as a fortress

The back catalog remains the company's backbone, contributing 75% of revenue. Weider highlighted, “our back catalog still accounted for 75%” — Mikkel Weider, CEO · 2026-03-31, and it provides stable cash flows and predictability. Varachia added that over 50% of catalog revenue comes from titles four or more years old, demonstrating longevity. This is supported by a conservative amortization policy of 2 years with 30% in month one, which he said has not changed despite accounting-advice to lengthen it — a signal of prudence.

Financial discipline is evident. The company ended the year with £51.9M in cash, paid a maiden dividend of 2.9p, and guided FY26 cap dev to £45M, a deliberate investment in first-party titles like Hell Let Loose: Vietnam and Golf With Your Friends 2. While Hell Let Loose and other big releases are weighted to H2, the CEO is confident about meeting market expectations for adjusted EBITDA.

Capital allocation and M&A

On the call, management was asked about M&A versus buybacks. Varachia said, “We want to do M&A, and it's great that we have the funds to do M&A. But in terms of share buyback, it's very unfortunate where we find ourselves with our share position and share price position this week” — Rashid Varachia, CFO · 2026-03-31 — leaving buybacks under review but no immediate action. Weider stressed a highly selective M&A approach, favoring IP and games over full studios, and would only buy assets that fit the existing verticals. The recent Hammerwatch acquisition and a 5% stake in Super Media Group/Bulkhead illustrate this.

The strategic pivot is clear: leverage AI to scale, rely on the back catalog for stability, and invest in IP with long tails. The question is whether the market will reward the patience. With a market cap of just over £400M, everplay is a small but well-positioned player, trading at a moment when investors are skeptical of software-margin degradation from AI. Management's counter-narrative — that AI increases the need for professional publishers — is bold and worth watching.