Devolver Digital Inc shares plunged on Monday after the company warned of weaker than forecast sales from newly-released video games.

Shares in the company were 30% lower at 95.00 pence each in London on Monday morning.

The Delaware, US-based video game publisher said sales from new games released in the first five months of the year have been ‘slower than expected’.

Devolver cited a competitive game release window and ‘specific factors for each title which are being actively addressed for future titles’ as the reasons for the weaker sales.

‘At the same time there has been an expected step-up in amortisation costs related to these heavier-investment games upon release, as well as increases in general operating expenses due to inflation, headcount and marketing,’ the company added.

For 2022, the company expects revenue between $130 million and $140 million, potentially up over 40% from $98.2 million in 2021.

Adjusted earnings before interest, tax, depreciation and amortisation are to land between $27 million and $32 million, growing by up to a quarter from $25.7 million.

‘Adjusted Ebitda is expected to be higher in the second half of the year, as a result of increasing revenues, improved gross margins and operational leverage,’ Devolver added.

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