Devolver Digital shares drop by over 50% as investors not satisfied with lowered sales expectations

Devolver Digital has seen its share price drop by over 50% over the last few days. The decline happened after the publisher warned investors of slower-than-expected sales.

On June 13, Devolver released updated guidance for the current financial year ending December 31.

“Sales from new games released in the first five months of FY22 have been slower than expected, reflecting a competitive release window and specific factors for each title which are being actively addressed for future titles,” the statement reads.

The company also cited increased amortization costs and general operating expenses due to inflation, headcount and marketing among other reasons behind the slowdown.

As spotted by GamesIndustry.biz, Devolver share price dropped by 47% to 72.5 GBX (around £0.78). The fall continues today, with the company’s stock now trading at 50 GBX (£0.54) per share.

Despite the slowdown in sales, the publisher expects its full-year revenue to reach $130-140 million (up 30% year-over-year). Adjusted EBITDA is expected to be around $27-32 million (up 15% year-over-year).

“Looking forward, Devolver’s pipeline of titles is as strong as it has ever been, with visibility well into 2024,” Devolver founder Harry Miller said, as the publisher expects most of its sales to come from its back catalog of more than 90 games.