<a id="bm-comp-3aa8e3d6-76eb-4929-9c17-5ee5b2f06127" name="bm-comp-3aa8e3d6-76eb-4929-9c17-5ee5b2f06127" class="BMCustomAnchor"></a><table><tr><td bm-component-id="3aa8e3d6-76eb-4929-9c17-5ee5b2f06127" style="vertical-align: top; width:100.000000%;"><ul><li>Significant cuts to '26e on lower sales</li><li>...but '27e-'28e fairly unchanged due to cost savings</li><li>Trading 6x EV/adj. EBIT 2026e but 2x on 2027e</li></ul></td></tr></table><a id="bm-comp-05f7ba48-484d-407d-8f6e-996414126acd" name="bm-comp-05f7ba48-484d-407d-8f6e-996414126acd" class="BMCustomAnchor"></a><table><tr><td bm-component-id="05f7ba48-484d-407d-8f6e-996414126acd" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Estimate changes</h3><p>We have assumed ~USD 6m cost savings on an annualised level, with full effect from Q4'26. This means that we expect 2026 to be relatively unaffected by the savings. We therefore cut 2026 adj. EBIT by 39% on 3% lower sales, magnified by a relatively low adj. EBIT figure. For 2027-2028, we expect that the savings will offset 5-8% lower sales, for +2% and -4% adj. EBIT revisions. We now expect USD 7.6m adj. EBIT in both 2027 and 2028 (~SEK 70m) and USD 7.6-7.7m in FCF (~SEK 70m).</p><h3 class="bm-h3">Gross margins and cost savings to support earnings</h3><p>Continued gross margin improvements (73% in Q1 vs 72% in Q4 and 70% in Q1'25) mean that gross profits remain fairly stable, especially compared to sales and adj. EBIT. Gross profit decreased 8% in 2025, and we expect -4% in 2026e. The main problem we see for earnings is that the company has been over-staffed given its mature portfolio profile. Assuming current portfolio dynamics persist (i.e. no new games to put significant investments behind) we think the organisation could be downsized significantly more. If sales continue to decline, we still think G5 could sustain >10% EBIT margins and >USD 5m EBIT for many years, but if some of its larger games are put in harvest-mode, we think margins could reach 20-30%.</p><h3 class="bm-h3">18% FCF yield '27e and ~60% of market cap in net cash</h3><p>The main question is how much the company is willing to continue to invest in generating new titles. Success has been sparse, but all it takes is one title. We see management's willingness to right-size as positive because it could support a higher pay-out ratio in the wait for better growth. On our updated estimates, the share is trading at an 18% FCF yield when cost savings are fully visibile in 2027e, while the company also carries ~60% of market cap in net cash.</p></td></tr></table>