Frontier Share Price Drops 40% Due to F1 Manager 2022 Underperformance
The poor sales performance of F1 Manager 2022 as well as of the Frontier's older games during the holiday season caused the studio to reduce its revenue projections for FY23 and FY24.
Shares of Frontier Developments, the developer behind Jurassic World Evolution, Planet Zoo, and F1 Manager 2022, dropped by nearly 40% after the company released an update for investors on Monday where it detailed its disappointed sales figures.
According to Frontier, it no longer expects to meet its prior sales and profit guidance for the current financial year, mainly due to the underperformance of its most recent release, F1 Manager 2022, during the holiday season.
The company noted that F1 Manager 2022, which has sold over 600,000 copies to date, "remains a good first game in an important new annual franchise for Frontier" and that its initial sales following its August 2022 release were strong. However, its sales performance during the holiday period fell materially below original expectations. Frontier attributes this to "increased player price sensitivity related to worsening economic conditions."
Due to the game's poor sales as well as general sales underperformance across the whole portfolio during the holiday season, the company has adjusted its projections for the fiscal year 2023. Now Frontier expects revenue of £100 million, although it believes "it is still possible to surpass last year's record revenue performance of £114 million." The revenue projection for the upcoming fiscal year has also been reduced.
"It is very disappointing to be resetting our financial expectations," the studio head Jonny Watts commented. "As CEO, I am driving a change in emphasis to increase focus on our core strengths and skills, with particular attention to increasing the return on investment that we achieve from our world-class teams. We intend to grow the number of our development teams to increase the cadence of new releases, whilst continuing to nurture our existing portfolio, to achieve sustainable growth."
You can find Frontier's update for investors here. Also, don't forget to join our 80 Level Talent platform, our Reddit page, and our Telegram channel, follow us on Instagram and Twitter, where we share breakdowns, the latest news, awesome artworks, and more.
