By Michael Susin
tinyBuild shares slipped after the group warned that it is likely to miss analysts’ expectations as the market further deteriorated and key contract negotiations have been extended and might not be signed.
Shares at 0830 GMT were down 1.4 pence, or 22%, at 4.75 pence.
The U.S. publisher of indie games said on Tuesday that revenue for 2023 is likely to come in between $40 million and $50 million, with the top end of the range dependent on large contracts being signed before the year-end. This compares with the company-provided market consensus of $49.9 million.
The company added that revenue remains weighted toward lower-margin third-party games, which is hurting gross profit margin.
To mitigate it, tinyBuild has accelerated its cost reduction plan and it is refocusing on lower risk and higher-than-expected return projects to achieve cash outflow reduction by $5 million to $10 million per year starting from 2024.
The company said that it is considering a future equity fundraise of up to $10 million to re-align investments.
tinyBuild added it has agreed to pay $3.5 million to settle a claimant regarding an employment agreement with a general manager.
Write to Michael Susin at michael.susin@wsj.com
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