TSG Group’s Q1 2025 financial results: strong profitability and solid cash generation despite market and product challenges

In Q1 2025, Ten Square Games demonstrated the strength of its business model by delivering strong profitability and solid cash flow despite a decline in bookings from its main titles. It was a period of intense focus on product quality, finalizing the roadmap for necessary changes in each project, and conducting large-scale testing of new features. The company continues to lay the groundwork for improved monetization over the long term. At the same time, TSG Store delivered record results, and the development of two prototypes accelerated.

TSG Group in Q1 2025

In Q1 2025, bookings across the Group’s games totaled PLN 90.5 million, marking a decline compared to both Q4 and Q1 2024. This was primarily due to decreases in the Group’s two main titles. At the same time, both Wings of Heroes and Real Flight Simulator maintained their positive momentum, recording growth in bookings.

Adjusted EBITDA came in at PLN 30.5 million, representing a 7.5% increase q-o-q and an 11.0% increase y-o-y. This result was largely driven by the decision to reduce marketing spend. While this decision has a short-term negative impact on bookings, it is expected to improve the effectiveness of future user acquisition investments over the long term.

The Group continues to closely monitor and optimize its operating costs. As a result, TSG Group reported a net profit of PLN 27.5 million for the reporting period – significantly higher than in both Q4 and Q1 2024. A key strength of the Group’s business model remains its robust cash-generating capacity. As of the end of Q1 2025, TSG Group held cash and cash equivalents of PLN 172.4 million.

– Q1 2025 brought mixed results for our operations. On one hand, we recorded weaker performance in our two main titles, due to the slower-than-expected pace of implementing changes. On the other hand, we delivered strong financial results, achieved a record-high share of TSG Store in Group bookings, continued growth in Wings of Heroes and Real Flight Simulator, and intensified prototypes development. Despite the challenges in our core titles, we believe in the chosen strategy and are already seeing the first positive effects – even if they are not yet reflected in financial results. In the near term, our goal is to improve team efficiency and consistently build the foundation for the Group’s long-term value growth.” – said Andrzej Ilczuk, CEO of Ten Square Games S.A.

Flagship titles: laying the foundation for future growth

In Q1 2025, the teams behind Fishing Clash and Hunting Clash focused on improving player retention and enhancing the overall user experience. Bookings in both titles were affected by a reduced number of new locations added to the games compared to previous quarters, as well as a strategic reduction in marketing spend. The implementation of structural changes in both projects is taking longer than originally planned, meaning their impact will become visible at a later stage. As a result, bookings in Fishing Clash dropped to PLN 52.6 million, and in Hunting Clash to PLN 18.6 million.

The reduced marketing spend stemmed from the broad scope of changes being implemented in the core titles, which focused primarily on player retention and engagement. At the same time, work was underway to prepare both games for further changes in monetization. Investments in user acquisition during this period would not have delivered the expected return, which is why both teams focused on reworking the early stages of gameplay – the first 7 days of a player’s experience. The goal of these changes is to increase new user retention, establish regular gameplay habits, and better tailor offers to players at various levels of experience. By introducing advanced segmentation and personalizing the player experience, the Group expects to improve key monetization metrics in the long run, enabling a return to increased advertising spend on user acquisition above the levels seen in Q1 2025.

Wings of Heroes maintained its strong growth momentum, with bookings reaching PLN 7.3 million (+2.9% q-o-q; +149.5% y-o-y). The game received a range of technical and functional improvements. The most significant changes focused on the early stages of gameplay to make it easier for new players to get started. The team also worked on implementing a Battle Pass system – a new player progression path which launched on April 1.

Real Flight Simulator also sustained its positive trend in bookings, which reached PLN 5.3 million in Q1 2025 – up by 1.1% q-o-q and 6.8% y-o-y.

TSG Store: record results and a growing role in the Group’s business model

TSG Store has become one of the key pillars supporting the Group’s profitability. In March 2025, the platform’s share of the Group’s total bookings exceeded 19%. In the case of Fishing Clash, not only was the 25% target share reached in February 2025, but it was also surpassed in March, reaching over 26%. Intensified efforts by the Hunting Clash team since the beginning of the year translated into a strong increase in TSG Store’s share of that game’s bookings – reaching 17.5% in March. TSG Store achieved its best results in history, both overall and across individual products.

Ongoing development efforts and recent regulatory changes that expand developers’ ability to promote their own sales platforms significantly boost the potential for further growth of TSG Store’s share in Group bookings in the coming quarters.

New Games: Trophy Hunter nears global launch, real Combat Simulator advances

Around the turn of Q2 and Q3 of 2025, Trophy Hunter – a new hunting title from the TSG portfolio – is set to launch globally. The game targets a broader, more casual audience than Hunting Clash. It is a dynamic, skill-based game featuring fast-paced gameplay and progression centered around arena-based duels. Trophy Hunter uses a hybrid monetization model combining in-app purchases with ads and includes robust social features designed to foster an active player community.

At the same time, Real Combat Simulator, developed by TSG’s Italian studio Rortos, continues to evolve. In recent months, the game has been enhanced with additional aircraft models – M346, F18, and A10 – as well as new gameplay features. A multiplayer mode, planned for release in June, is expected to significantly boost the game’s appeal. The team is also working on communication systems between pilots and refining the realism of all gameplay elements. In addition, work is underway on a dedicated tutorial for new players entering the world of advanced flight simulators. The game is currently in a testing phase and is steadily approaching commercial readiness.

Incentive program and profit distribution to shareholders

In May 2025, the General Meeting of Shareholders approved a new incentive program for the years 2025 – 2029, aimed at increasing the Company’s value and market capitalization. The program consists of three tranches, each tied to a three-year period: 2025–2027 (Tranche I), 2026–2028 (Tranche II), and 2027–2029 (Tranche III). Participants may be granted up to 323.8 thousand shares in total – equivalent to approximately 5% of TSG’s share capital – provided that two independent conditions are met: a financial performance condition (weighted at 80%) and a market-based condition (weighted at 20%).

The performance condition for Tranche I assumes the achievement of an ambitious, cumulative Adjusted EBITDA target of PLN 438 million for the years 2025 – 2027. The market-based condition requires that TSG’s share price on the Warsaw Stock Exchange outperform the WIG index by at least 10 percentage points during the respective period.

-In 2025, we’re executing many key projects simultaneously. Our top priorities are changes in our core games and ensuring continued development of Wings of Heroes. These initiatives demand full team focus. At the same time, we’re intensively working on the development of two new prototypes – both of which currently rely primarily on internal resources rather than significant financial investment. This allows us to responsibly consider larger investments in new ventures no earlier than next year. That’s why we’ve decided to recommend a record dividend payout to our shareholders. – said Andrzej Ilczuk, CEO of Ten Square Games.

The General Meeting approved the Management Board’s recommendation to pay out PLN 100 million in dividends. The dividend record date is June 20, 2025, with the payment scheduled for June 27, 2025.