Can PlaySide Studios’ New Games Reverse FY25 Losses?
PlaySide Studios reported a significant revenue drop and EBITDA loss in FY25, driven by declines in original IP sales. However, the company is banking on new game launches and cost-cutting measures to fuel a turnaround in FY26.
- FY25 revenue fell 25% to $48.7 million
- EBITDA swung to a $7.5 million loss including restructuring charges
- Original IP revenue dropped 45%, Work for Hire revenue down 7%
- Multiple new game launches including Kill Knight and Game of Thrones VR
- Post-year capital raise of $9.6 million to support growth and restructuring
A Challenging Year for PlaySide Studios
PlaySide Studios Limited, Australia's largest video game developer and publisher, has disclosed a challenging financial year ending 30 June 2025. The company’s revenue declined sharply by 25% to $48.7 million, a notable drop from $64.6 million the previous year. This contraction was largely driven by a 45% plunge in revenue from original intellectual property (IP), which fell to $16.7 million, while its Work for Hire segment also saw a modest 7% decline.
These revenue pressures translated into an EBITDA loss of $7.5 million, a stark reversal from the $17.5 million profit reported in the prior year. Included in this loss were $1.7 million in restructuring charges as PlaySide undertook significant cost-cutting and operational realignment efforts.
Operational Highlights and New Launches
Despite the financial setbacks, PlaySide maintained momentum on the product front. The company launched several titles during the year, including Kill Knight on PC and consoles, which received a stellar 94% review score on Steam, marking a record for the studio. Other releases included Dumb Ways, Free for All and Thrive, Heavy Lies the Crown, as well as VR titles like Shattered and Civilization VII - VR in partnership with 2K.
Most notably, anticipation is building around the upcoming launch of MOUSE, P.I. for Hire, which has already seen wishlist numbers surge from 600,000 to over 1 million. The company also announced Game of Thrones, War for Westeros, which garnered significant attention with the second most viewed trailer at the Summer Game Fest in Los Angeles and ranks in the top 6% of Steam wishlists.
Restructuring and Capital Raising to Support Recovery
CEO Benn Skender emphasized that FY25 was a year of heavy investment in original IP, with the company now focusing on streamlining its development slate to prioritize projects with the highest return potential. The restructuring has identified substantial permanent savings in overheads, and PlaySide aims to return to a self-sustaining business model as Work for Hire activity picks up and major titles launch.
To bolster its financial position, PlaySide completed a $6.6 million placement at $0.20 per share after the fiscal year-end and is conducting a Share Purchase Plan to raise an additional $3 million. These capital injections are intended to support ongoing development and operational improvements.
Looking Ahead, FY26 Guidance
While management remains cautious, it expects FY26 revenue to exceed FY25 levels, driven primarily by the launch of MOUSE, P.I. for Hire and a reduction in operating costs. Greater clarity on FY26 financial outcomes is anticipated shortly after the game’s release. Investors will be watching closely to see if the company can translate its operational investments and restructuring efforts into a sustainable turnaround.
Bottom Line?
PlaySide’s FY25 losses underscore the risks of heavy IP investment, but FY26’s game launches and cost cuts could mark a pivotal recovery.
Questions in the middle?
- Will MOUSE, P.I. for Hire meet high market expectations and drive revenue growth?
- How effective will the restructuring be in restoring profitability?
- What impact will the new capital raise have on PlaySide’s development pipeline and financial stability?