Embracer Group shares surged over 15% Thursday after the gaming company reported third-quarter results following its Coffee Stain spin-off. Despite reporting lower sales and profit, the Stockholm-based firm upgraded its full-year outlook on a comparable basis, reassuring investors about its strategic direction after restructuring operations. The company reclassified Coffee Stain Group as non-current assets following its December 11, 2025 spin-off and listing.

The company's net sales fell 26% year over year to SEK 5.2 billion, with organic growth down 8%. Adjusted EBIT declined sharply to SEK 528 million from SEK 948 million, while margins compressed to 10% from 14%. Cash flow from operating activities plummeted to SEK 443 million compared with SEK 1.5 billion in the prior year period.

For the 2025/26 financial year, Embracer now projects adjusted EBIT of at least SEK 750 million, representing a modest upgrade when excluding Coffee Stain. The market reacted positively to the improved comparable guidance, suggesting investors believe the spin-off and refocused business model position the company for better performance despite near-term industry headwinds.