Stillfront Hands the Keys to a King Alum as Its Franchise Bet Finally Pays
Five straight quarters of key-franchise growth and a new CEO from Candy Crush — but the strategic review that dominated 2025 has vanished from the script.
SF.ST · Earnings Call · 2026-10-23
The handover
The call opened not with revenue but with succession. Chair Lars-Johan Jarnheimer thanked Alexis Bonte for leading Stillfront through “a decisive period of strategic and organizational change,” then named Marcus Jacobs — a veteran of King's executive management and Candy Crush — as incoming CEO from November 1. The board is effectively declaring the turnaround complete enough to hand off. “Marcus has an extensive experience in the industry, including many years in King's executive management and Candy Crush, which became one of the world's biggest mobile games.” — Lars-Johan Jarnheimer, Chair of the Board · 2026-10-23 That is a deliberate signal: the next phase is about scaling franchises, not fixing the ship. What is more revealing is what the call did not discuss. The strategic review was the single biggest theme of 2025 and early 2026 — it ranked first in the first-quarter 2025 keyword set and was the subject of repeated analyst questions. In February, Rasmus Engberg asked directly whether it meant non-core assets were for sale. “And the question that many investors think about the strategic review, should we see that as now clearly indicating that it's not among the key franchises that we should expect a deal?” — Rasmus Engberg, Analyst · 2026-02-04 Alexis insisted it remained open. By July, Rasmus was asking whether it would conclude before his departure. On his final call, the topic did not come up once. The divestments of Narrative and OFM Studios are done, the Gameberry royalties have ended, and the review appears to have served its purpose — or been quietly parked for the new CEO. Either way, a multi-quarter narrative has been retired without ceremony.The franchise math
The operating story is genuine progress wrapped in a shrinking portfolio. Key franchises grew organically by 8% — their fifth consecutive quarter of growth — and now account for roughly three quarters of revenue. BIG grew 78% on the back of Big Farm: Homestead; Empire added 22% in its fifteenth anniversary quarter; Board grew 16%; Jawaker held onto last year's exceptional level with 3% growth. “Our organic revenue has now been broadly stable for three quarters in a row, after declines of 8% and 9% in the second half of last year.” — Alexis Bonte, CEO · 2026-10-23 But the group still posted a 1% organic decline because Other Games fell 23%. That is the price of focus. Other Games now make up 24% of revenue, down from 35% a year ago. The divestments and the end of Gameberry royalties accounted for about 4.5 percentage points of the reported 6% absolute revenue decline. The organic decline is narrowing, but the portfolio is being deliberately shrunk to health. Nick Dempsey of Barclays pushed on whether any Other Games are loss-making enough to shut. Alexis was categorical: “we operate all Other Games in a profitable manner. We're really making sure that they're delivering positive cash flows to the bottom line.” — Alexis Bonte, CEO · 2026-10-23 CFO Emily Villatte added that there are no heavily declining titles absorbing heavy marketing. That is a defensible answer, but it also means the drag persists by design — a deliberate run-off rather than a cliff-edge fix.The UA trap
Supremacy was the weak spot: organic revenue fell 10% against an exceptional 31% comparison, and management blamed a more challenging user-acquisition environment for the franchise. This is not a new theme. In July, Nick Dempsey warned that a falling user-acquisition spend is usually a leading indicator of weaker organic growth ahead. “if the UAC has dropped, particularly when we're rolling towards the end of the quarter. That's because the environment is looking less attractive for deploying it. And therefore, we should watch out for a more negative rate of organic revenue growth in the coming quarter or quarters.” — Nick Dempsey, Analyst · 2026-07-24 Emily confirmed at the time that the environment weakened into late June. Now UA sits at 24% of revenue, below the usual 25%-30% band. “This quarter, we were actually a little bit lower at 24%. If we are able to deploy a little bit more than that in Q4, that would be because the marketing environment allows us to do so.” — Emily Villatte, CFO · 2026-10-23 The challenging user acquisition environment is the recurring tension in this story. The franchise model is profitable and community-led — Jawaker barely spends on paid marketing — but the growth franchises still need efficient acquisition. Q4 seasonality will decide whether the -1% organic slips back or tips positive.AI, quietly
The freshest theme on the call was artificial intelligence, but not the kind dominating the market tape. Stillfront's use is internal: AI agents write, review, and test code, making it affordable to modernize older games; AI-assisted production sits behind ReelSaga, a short-form drama app launched in Croatia. “Our engineers use AI agents to write, review, and test code, which also makes it affordable to modernize some of our older games.” — Alexis Bonte, CEO · 2026-10-23 This is a margin-and-velocity story, not a capex or data-center demand story. While global AI infrastructure themes are in a 90-day drawdown, Stillfront's AI angle is company-unique and modest. It is early-stage, tied to results, and unlikely to move numbers soon — but it is the kind of quiet operational lever that compounds.Cash and the 2027 cliff
The balance sheet remains the anchor. Free cash flow rose to SEK 256 million in the quarter, net debt fell to SEK 4.4 billion, and leverage held at 2.2 times. The remaining earn-outs of SEK 671 million are due in June 2027; all external debt matures no earlier than 2028.The Gameberry royalty ended this quarter — it topped the keyword table, but as a headwind rolling off, not a growth driver. The maturity profile is genuinely comfortable, and deleveraging remains the priority.2027 is an important inflection point for us. When the remaining earn-out obligations are settled, significant annual cash flows will be released, which strengthens our ability to deleverage, and this remains our near-term capital allocation priority.