Hello everyone, and thank you for joining Remedy Entertainment's webinar. My name is Veli-Pekka Puolakanaho, and I manage the investor relations at Remedy. Today we will go through Remedy's financial statements report for January- December 2023. With me are Tero Virtala, Remedy CEO, and Terhi Kauppi, Remedy CFO. We will have a Q&A session after the presentation. Tero, the floor is yours. Thank you. Welcome everyone, also on my behalf. So let's first go through this year shortly. Terhi will then go through the financials, and as a lot has happened, I will then get back and we will have a bit more in-depth view on what our status is and future direction. But the last quarter of 2023, our revenue was EUR 10.3 million, EBITDA - EUR 3.9 million, operating profit -EUR 12.8 million. Cash flow on the last quarter was slightly positive, and of course the biggest event was that Alan Wake launched on October 27. And during the latter part of the year, the game won several awards, including very respected awards at The Game Awards. We also announced that Codename Vanguard got a fresh start under a new codename, Kestrel. Based on that, we made an evaluation and also recognized an impairment charge of EUR 7.2 million, which impacted our fiscal year 2023. Also, as a key development internally, Markus Mäki assumed a new role in our core management team, Chief Product Officer, and Mika Vehkala was appointed as a new Chief Technology Officer. The full 2023, then we ended it by having a revenue decrease of 22% compared to 2022, revenue being EUR 33.9 million, EBITDA of -EUR 17 million, and operating profit of -EUR 28.7 million. So overall, last year was the year on heavy investments but also heavy losses. As said, Alan Wake 2 was launched, has won several awards, and based on all of that, the board of directors proposes that no dividends will be paid for the year 2023. A few words on last year in relation to Alan Wake 3, its development, and road to launch. Alan Wake 2, of course, was a major focus for us last year. During the game's development, we all the time knew that we had a great game in our hands, but being able to finalize and polish it to create final product is never easy. Alan Wake has been the largest and most ambitious project we have so far undertaken. These are big and complex projects. Bar to succeed has been rising over the year, and AAA gamers expect great quality from day one. It's often said that the last 10% of the game development is the hardest part. That was the case also for us, but our team did great work throughout the year, and eventually successful launch proved it. Making a great quality Alan Wake 2 was a priority for us and required more personnel during the year than we had originally planned. In 2023, we were able to meaningfully also advance the other projects, but there were also some delays in them. As the other projects did not receive all the people, they were not able to proceed as fast to next development stages that we originally had planned. On the other hand, these projects were preparing themselves and now have been really prepared to take on the people that have been coming from Alan Wake 2, and they have been able to advance with a really good velocity. We see that keeping people longer in Alan Wake 2 was the right choice. With great quality of the game, we can, of course, now expect good long-term sales for the game, and with the growing fanbase, the future possibilities are also growing. The seal of quality affects us also in other fronts: our people, the recruitments, and the perception from our partners. For example, at the moment, we are evaluating different publishing models for Condor and Control 2 and potential future partners for those. Our recent AAA games now are Control and Alan Wake 2, and of course, games in this quality support these partner discussions as well. I'd also like to mention that Epic Games Publishing, together with our own publishing unit, did our biggest and very well-executed marketing campaign for Alan Wake 2. This then all led into a successful launch. The game was praised by critics and players. The Metacritic score of 83 places Alan Wake 2 among the very best game launches of the whole 2023 within the top 2% of all the more widely reviewed games. It's good to bear in mind that this is just those selected games that are even chosen to be more widely reviewed, so among the wider gaming market, this high-quality reception that Alan Wake 2 got is an even rarer case. It was also good to see that Alan Wake 2 was praised on so many fronts: on its story, world, atmosphere of the game, the visuals, gameplay, technical part. Original Alan Wake, a long time ago, impressed people in some fronts but left players to hope a bit more on some other areas. Alan Wake 2 clearly was a major step forward. Now, at the moment, the industry awards season still continues, but we can already see that Alan Wake 2 has been one of the big ones in these award considerations. We have already won over 200 awards, which we highly appreciate. In practical terms, this also gives good additional visibility and is something that benefits longer-term marketing and sales efforts as well. The sales of Alan Wake 2 started well, despite the very competitive launch window and overall so many great games that have been launching throughout the year. Alan Wake 2 was a digital-only release and sold over one million units by the end of the fourth quarter of 2023, which makes it the fastest-selling Remedy game. The end of the year was the holiday period, the highest sales season of the year. Normally, the phase following that, the early part of the year from January to March, is the most silent sales period of the year, but Alan Wake 2 continued to sell well also in January, selling 300,000 more copies by early February. If we compare that to our recent AAA game launch, Control, which launched in August 2019, Alan Wake 2 sold in two months over 50% more copies overall and over three times more digital copies in its first two months than Control did in its first four months. So we are in a clearly higher early sales trend than Control was. Since its release in 2019, Control has sold over 4 million units, generating net revenue of approximately EUR 100 million. It's, of course, a different game, but shows that great games can generate strong long-tail sales. We expect this to be the case also with Alan Wake 2, and we are working systematically with our publishing partner, Epic, to make sure that that happens. The individual positive point is that the price point has so far remained at the high level, and the game has already recouped a significant part of the development and marketing expenses that our partner, Epic, has invested into it. We are overall expecting that Alan Wake 2 will be a meaningful revenue and profitability driver for Remedy this year. Now, to shed a bit more light on why we see that Alan Wake 2 has good long-term sales opportunities. The topics that I'm now going to discuss in this slide are some of the high-level learnings on the Control audience and their buying behavior. The early phase of Alan Wake 2 sales is in line with that. So overall, Alan Wake 2 is, of course, in the very early phases of sales. We have so far just reached part of the fanbase and not yet the larger audiences. And based on the Control learnings, there is a lot of sales potential still ahead of us. We see that on a high level, based on when players buy our games and what is the audience for our AAA games, this has fallen. This has put gamers into five main segments. We call them core fans, fanbase, extended fanbase, genre enthusiasts, and genre tryouts. In a bit more detail, core fans for Alan Wake 2 are the fans who pre-order the game before its launch. The fanbase consists of buyers of the game at full price, either at the launch or very early in the life cycle of the games. These are the two groups that we have so far reached. The bigger the underlying franchise is and the more of the good sequels a franchise has already gotten, typically the bigger the fanbase these two segments are. So with good sequels, these segments will automatically grow, and with PR marketing sales efforts, the size can be grown even more. Control was a new IP back in the day, and it had no existing fanbase. Also, its marketing budget in 2019 was much smaller, so still at launch, these two segments were really small for Control. In Alan Wake 2, they have been bigger, but we need to bear in mind that Alan Wake 2 is not a normal sequel. It came 13 years after the first game, a way too long time to build and maintain an audience. In many ways, we see that we have now, with Alan Wake 2, started to rebuild that fanbase. Then when we look at what is the segment that we are now targeting, that's the extended fanbase. The extended fanbase consists of buyers who have high interest for the game, but they typically start to activate later, especially when the light discount campaigns start. The bigger audiences that we have are genre enthusiasts and tryouts. Genre enthusiasts we see based on the older buying habit. They are the fans of the gaming genre. They are not necessarily fans of an individual game, but they like the genre, and they buy good games, but they mainly buy them later in the life cycle at discounts. Genre tryouts—they are anyone interested overall in interesting enough games, and they typically get games much later in the life cycle with exceptional offers or nowadays for free in these different subscription services. These two last ones—they are the biggest audiences in long term for any game. Now, if the game isn't of good quality, these two last big segments cannot even be reached. But if the quality is good, these segments are major ones for the longer-term sales. We haven't yet even tapped into those. We are, at the moment, still kind of like tapping into the extended fanbase and reaching those players. We now have two franchises in our hands: Control and Alan Wake. When we take these franchises further, including more regular sequels, the overall size of the whole audience is growing. But very importantly, with sequels, the size of the early segments (the core fans' fanbase, extended fanbase) grows even more. And all this is going to be further supported by the Remedy Connected Universe. Our game worlds are based in the same wider universe with certain connections and cross-pollination. This seems to be resonating quite well with our audience. We now, for the first time with the launch of Alan Wake 2, have two bigger, newer games in this universe, and the early signs are showing that this increases players' interest for all of our games. As said, this is still a very early phase, but done right, we see that the Remedy Connected Universe is an additional way to deepen our worlds and stories and give more to our players and also support the sales of each game, growing their fanbase. Then, if we have a look at our current project portfolio, these are the games that we have been working on. Of course, Alan Wake 2, we continue working on the DLCs, supporting the game, supporting the sales of the game. We are working on Codename Condor, the Codename Condor, the co-op game in the world of Control, and the sequel for Control, Control 2. Max Payne Remake, naturally, is a game in development. Kestrel, it's good to highlight that it isn't yet a full project in our portfolio. With Tencent, we decided to stop the development of Vanguard in 2023, and after evaluation early this year, we gave the project a fresh start to seek for a multiplayer game that is more closely aligned with our strengths and synergies. Kestrel currently has 15 people in the conception phase, and it's a very early phase. Now, let's have a bit closer look at the projects that are further along in their development cycle: Max Payne, Condor, and Control 2. Max Payne 1 and 2 Remake - we are reviving one of the game industry's iconic franchises with Rockstar Games, a game originally created by us. It's a big and significant game for us. The development budget is in the same range as we had with Alan Wake 2. We see great potential with this one. The development overall has progressed according to our plans, and the project is expected to move into full production now in the second quarter of this year. Condor is the co-op multiplayer game in the world of Control. The game is already playable, with proven core gameplay proof around which the rest of the game is being built. Play tests that we are having show positive response for the fun and engaging gameplay, as well as for the collaborative aspect of the game. Full production is actually starting already in this quarter, so basically within the next two weeks time. Condor, it's a new type of game for us, but we are really happy that now in pre-production, the team has nailed down a lot of open questions that we have had to sort out, and development velocity has been now improving rapidly. Control 2, a big sequel, a big and ambitious sequel for Control. It's our next step also towards a longer-engaging single-player direction. The game is currently playable. We have reached significant proof of concept goals, which include combat, world, gameplay, and the visual side. Internal and also external play tests have been very positive for a game that is still in pre-production. The project is moving into production readiness in the second quarter of this year. Also, it's good to highlight that Control—we say—has just been now successfully established. With its world and gameplay, it offers significant expansion and growth opportunities, and our aim is to systematically grow Control into a major gaming franchise. This action and the actions required were not anymore aligned with our partners' interests and abilities to support us in making that happen. So, as a result, with good negotiations and collaboration with 505 Games, we acquired all publishing, distribution, marketing, and other rights for the Control franchise, including Codename Condor, Control 2, and all future Control products back to Remedy. The maximum purchase price for this transition is approximately EUR 17 million, which equals the amount that 505 has paid for the development of the Codename Condor and Control 2 to date and includes a minor premium. This deal overall allows us now to decide from this point forward what is the best way to continue, and we believe that it opens major growth opportunities in the mid and long term. Overall, I can say that this is an exceptionally good deal for us. I'll end my part here. Terhi will now talk more on the financial side, and after that, I'll continue and give a wider view on our current status and future direction. Terhi, please. Thank you, Tero. So, good afternoon also on my behalf. And now, first, let's look at the quarterly figures more in detail. Our quarter four revenue was a bit more than EUR 10 million, and it was 24% lower than in the comparison period. Out of our total revenue, the development fees were 74% and royalties 26%. Our development fees decreased by 40% due to less development fees from Alan Wake 2 as the project completed now in October. Royalties grew year-on-year by almost EUR two million to close to EUR three million, and that was due to Alan Wake Remastered, which filled the recoup earlier in the autumn and started to generate royalties for us. Historically, there has been and will be quarterly variation in revenues. We can see also from here that a source for meaningful royalties has been lacking for a while. We are in the investment phase, and that is reflected in the profitability. For quarter three, the EBIT was negative by almost EUR 13 million, resulting also in a very bad profit margin. EUR seven million of negative EBIT was caused by the one-time write-off for Project Vanguard capitalizations. The rest of the decrease in profitability was due to lower development fee revenue and higher expenses overall, but especially from outsourcing. Now in quarter four, we had Alan Wake Remastered game's depreciations amounting to EUR one million. Full-year numbers: our revenue decreased by 22%, ending up at the level of about EUR 34 million. Our royalties increased by 21%, while development fees decreased by 27%. As Alan Wake 2 got completed, the development fee revenue from the project was significantly lower than in 2022. During 2023, all but one of our ongoing projects had co-funding elements, decreasing the revenue generated during the development phase but increasing the future royalty revenue potential. Our royalty revenue was almost EUR one million higher than in 2022 as Alan Wake Remastered started to generate royalties to us. For the full year, the EBIT was negative by close to EUR 29 million, and that means a -84% profit margin. Also, the full-year profitability was impacted by this EUR seven million one-time write-off for Vanguard. The rest of the decrease in full-year profitability was due to a lower level of development fee revenue but also due to higher expenses, especially outsourcing. For transparency, we also present here unnetted amounts of expenses. External work (so outsourcing) performed was on a higher level than in the comparison period: EUR six million versus EUR four million. In IFRS format, the netted amounts are EUR five million and EUR three million. The difference is due to capitalizations of external development. Then, about the personnel expenses: we had about a 10% increase due to the increase of about 7% in our employees to 352 people from 334. And then there's some difference also due to the increase in the site costs, especially in Sweden, and accrual of the holiday pay. Capitalizations were on a 44% lower level than in the comparison period due to Codename Condor's lower level of external work and no more capitalizations done for Codename Vanguard in quarter four. Operating cash flow in the last quarter, 2023, was EUR 0.1 million, and in the comparison period, about - EUR four million. The reason for this change was that we had a higher level of incoming payments from partners now. And also, as in profitability in cash flow, we have high quarterly variation. Our total cash level was about EUR 30 million, including EUR 10 million in investments, and the current interest rate environment gave us a possibility gain on investments. We had a solid cash position to invest in our projects, and as we have done so, it is visible in the cash position development. So, our current profitability level is highly impacted by increased own investments to product development, but this is to ensure our top-line growth and improved profitability in the long run. We have a balanced portfolio of projects. We have a subcontracting type agreement with Rockstar Games for Max Payne Remake. We have an agreement with Epic. Remedy owns the IP. Epic mostly funded the development, and now we share the game sale profits. We have a co-publishing deal with Remedy-owned IP Kestrel. Now, for Condor and Control 2, the model is open after we bought the publishing rights from 505. When thinking about the future business models, balancing the risk and reward is key. The higher we move up in the picture, the more there are models where the profitability of a game project is depending on the game sales rather than development fees received from a publishing partner. If you look at the pluses and minuses related to the development phase, you see that in partner IP subcontracting, we usually have a margin already during the development phase, but in other models, not. There is a significant timing factor related to the risk level. Also, it is worth reminding now, as Alan Wake is out and has been for a while, that we need to first wait for the game to recoup its development fees and marketing paid by a partner before we start to see any of the royalties in Remedy's end. Now, as we have the publishing models open for Condor and Control 2, it is good to show an illustrative number example of some of the different models we can choose. All of these cases, five of these, use the same basis development budget of EUR 30 and marketing budget of EUR five. They also assume same game net sales, sales that are, after all deductions, shareable with the publisher, and this sale is assumed to the level of 100 over the game lifetime. These cases illustrate how development costs can be shared with a partner during the game development and how marketing spend is split. In these scenarios, the degree of development costs covered by a partner varies from 100%-0%, i.e., self-publishing. Marketing is normally paid 100% by a partner, but there can also be different models, like in scenario two, partner only pays 50% of marketing. Typically, both development fees and marketing are recouped back before there is a royalty share. It is essential to understand that the recouping means, from a business gains point of view, plus-minus-zero effect. If something is first paid and then recouped, the effect on ROI, return on investment, is zero. Of course, recouping only happens if the game sells so well that recouping can happen, so it evens the risk level. Please note that in case three and four, the ROI is at the same level, although in scenario three, partner pays 100% of development, and in scenario four, only 50%. But there is no recoup for development fees in case four. Developer royalty share varies in these scenarios from 20%-100%, and this element is a key driver for return on investment. As seen here, the return on investment from self-publishing is significantly higher, but timewise, we would need to invest ourselves fully first, so this model imposes clearly more risks. However, being able to do self-publishing can boost company profits to the next level. Now back to Terhi. Thank you, Terhi. All right. So, as the basis of this, as said, the dividend proposal, the board of directors proposes that no dividends will be paid for the year 2023. On the outlook, we expect revenue to increase from the previous year and operating profit to improve. It's good to still emphasize that the revenue growth rate and EBIT improvement, they are dependent on the choice now between self-publishing and/or choosing a new publishing partner or Codename Condor and Control 2. When the decisions for the business model, whether it's self-publishing, co-publishing, publishing by partner, have been chosen and the potential partner and agreements have been made, we will then specify further the outlook for 2024. Now, I'll continue still with a bit wider context and giving a status update because definitely a lot has happened in 2023, and especially in the past six months' time. We have had key events like the successful launch of Alan Wake 2. We have also made big decisions affecting our game portfolio, not continuing with Vanguard and buying back all the commercial rights for Control. In the light of all that, I'll now give an overview of our past development and, on a high level, the future direction where we are aiming at. As a context for the past seven years, we have very systematically followed selected key underlying strategic guidelines. These guidelines have guided where we aim at and how we should develop and change as a company. The aim has been to develop longer-engaging games on top of our proven strengths, create our own growing game brands, which we can do at the same time operationally, build a scalable multi-project organization, and when we do that, step by step strengthen our position in the value chain. Now, as one view on that, building a well-functioning multi-project organization and model has been a key operational aim. Building this model has traditionally been hard to do in our industry, but early on at Remedy, we saw that not doing this would significantly limit our long-term growth opportunities and also cause significant risks. On the other hand, doing it successfully would open major opportunities. Over the years, our multi-project capabilities have steadily been growing. We have great people, now almost 400 world-class talent. We have been keeping the bar high all the time. As an example, last year, only approximately 1% of all the applicants who applied for a job at Remedy were accepted. We have done a lot of developments to enable and strengthen our multi-project model, from transforming and developing the organization to recruitment to having a strong focus on building stronger teams, expanding to Stockholm, and continuously developing the ways of working and what our culture is. We have also, along these years, had learnings. Thinking back, in the past, we have had a bit too many projects in relation to the ambition levels we have with our games and what our production capabilities have been at each point of time. We have still been able to progress all the projects. Eventually, the quality of our games has been good, but having a bit too much on our plates has meant some delayed schedules and additional budget needs along the years. For years, we steadily, as can be seen from this graph, we increased the number of projects to two, to three, to four, to five. A while back, we took a decision not to anymore add new ones, at least not as often, but rather start looking for ways to get more focus on what we do. There is still a lot to be improved in our multi-project model, and we keep on doing that, but now we are 400 talents. We have much better working game teams. We have many supporting things in a much better shape than we have had before, and we don't anymore have five big projects. We actually, at the moment, have three actual bigger projects: Max Payne Remake, Condor, Control 2. Then we have Alan Wake, DLC development, and Kestrel isn't yet a full project. It's a small pre-production team working in the very early phases of the project. We are overall, in relation to multi-project capabilities, in a much better shape to succeed with our project than we have been in the past, and the state of the project, their velocity, tells the same. Even though I say that we have had learnings and we have had a bit too much on our plates over the years, we have still managed to launch four games in four years' time. None of them has yet been a major commercial hit we aim for, but overall, they have been good-quality games. Control has sold over four million units, a really good Metacritic score, high quality. Alan Wake Remastered has now passed 1.5 million sold units, a good-quality game. Crossfire was a profitable work for hire. It was a mixed-player reception for Remedy's story campaigns, but mostly they were liked. Some say that it wasn't a good quality, but we need to bear in mind that what was evaluated was the wider multi-project part, CrossfireX, which had a lot of technical issues. We were not focused on that. We were focused on our story campaigns that are part of the wider experience. And then, of course, Alan Wake 2, the sales by February: 1.3 million units with a really high Metacritic score. All this is a good start for the longer-term future and builds also a basis for next games to come. Then, if that was something on the wider picture in the past years, a bit more still in the year 2023. We started last year with a focus on five projects. Alan Wake 2 team, as I said, they went through a tough year in 2023 and came out with an amazing game and successful launch. Max Payne, despite some missing stuff last year that was still in Alan Wake, it's been very good progress. Codename Condor, it's definitely a new game to us: co-op multiplayer. Back in 2022, we actually also used much more external development in Codename Condor to build the basis for the game, but in early 2023, we made a decision to start taking much more of the development work in-house. That was a really good development and change, and as we have progressed throughout 2023, it's been with increasing speed, and the game is in a good state now. Control 2, as I said, is an ambitious game but looking very promising. In Condor and Control 2 in 2023, we also had uncertainties with our partner 505, and considering our aim and determination to make Control the big success, future success, and 505's possibilities to support that, it did create some question marks during last year. Eventually, we bought back all the rights with a very good deal for us, and this will be an additional boost not just business-wise but also for the development of Condor and Control 2. In Vanguard, the project was canceled. Kestrel is a fresh start with a small team. It's still in concept, not yet an actual bigger project for us. While this was a good decision just for Vanguard and Kestrel, it's also good to highlight that for our wider portfolio, this gave our other projects some needed developers and also more focus to us as a company. In addition to our current needs, we, of course, all the time do long-term planning, and we have been preparing for 2025, 2026, and 2027 staffing needs as one part of that. Now, when we removed Vanguard from that picture and the big needs that the big free-to-play game would have, it definitely gives us more focus and supports our other projects. And now what we can say is that the four larger projects that are now continuing in 2024, they took major steps forward in last year, and we are now in a much stronger position than we were last year. We now also have two established franchises in our hands: Control and Alan Wake. Control, of course, is now still being built and established by one game, Control. Alan Wake 2, yes, it's been 13 years after the launch of original Alan Wake, but the Alan Wake Remastered also started to revitalize that fanbase. It's also good to say that these brands overall, they are already quite well known among the gamers. We don't have all the telemetry or analytics data going back into the history, but we know that we have so far with Control and Alan Wake altogether already reached over 40 million players. So players who have played the game, who have downloaded the game, they are not necessarily unique players, but it's still a big audience that we have reached, and it's something that we continue to build as we go into the future. Then, on top of these, of course, many important developments have happened again in 2023 under the hood. These developments have made us stronger and support all of our projects. In addition to Alan Wake 2 and our other projects, we have had clarifications to the game portfolio. There have been significant developments in the way how we manage our portfolio and projects: longer-term planning, staffing, and development of our staff, how we manage the cross-project dependencies, decision-making, communication across the company. In the Northlight side, there have been significant developments both in the technology, tools, in the ways we work, and on the team side. It's not just development, but these have now been taken into use, and many of them are already now tested also in Alan Wake 2. We have had some changes that support us better in the core management team. Our publishing capabilities have been strengthened. We now have 14 people in our internal publishing unit, and the publishing unit has been all the time working hand in hand with 505 Games in relation to publishing and commercial matters for Control, and also now with the Epic Games publishing team in launching, marketing, doing the PR work, sales work for Alan Wake 2. Then, of course, the acquisition of Control rights was a big development. We have now also been preparing, we will tell more than later, the next phase in our multi-project organization that we call the craft organization. Overall, we have stronger teams. Personnel retention at the same time has never been on this good level that we now have. That was the background: Alan Wake 2 successfully out. We have two franchises, Control and Alan Wake, in our hands. With recent Control developments buying back the rights, we have the full freedom now to decide how to grow these franchises into much bigger and more successful ones. Now, especially in relation to the future publishing model for Condor and Control 2, not all our future plans are yet clear and set in stone. There are big strategic decisions ahead of us still this year. So what I'm now going to talk about is not a strategy update, but the direction or where we are going as a company. Certain key principles, even though the strategy has not yet been put in place, certain key principles for our future direction are clear. These are the principles that we know will guide us when we go into the future. We will have even more emphasis on having increased focus as a company and increased focus on utilizing synergies that we can have. Great games on top of our strengths, but one of the guiding principles already in the early phases is that we aim for games that, at minimum, earn back double the money that we invest into them. Someone could say a return on investment minimum 100%. Growing these franchises into much bigger ones than they can become is going to be one principle, and we will continue to strengthen our position in the industry. We are now reviewing the different options, but the aim is definitely to have a strong position with which we can grow these franchises into the major ones they can become. We can benefit in a big way as a company from that, and at the same time, we have the right way to manage the financial risk as well. In a bit more detail, what we mean with this direction: increased focus and synergies. So overall, I'd say that we have always had quite a lot of synergy focus in the wider gaming market. We focus on the big screen devices, PCs, consoles. We focus more on the core gamers and then on the casual gamers. Now, that market is overall now expanding with new marketplaces, new subscription services, and even within that big screen games for gamers segment, we have certain innovative teams that we have been following: action games, focus on the world-building, character stories, the visual style that we have. Overall, I'd say that as a starting point, we have always had already certain focus, and that's what we have been systematically following. Now, when we look at our development in the recent years in the multi-project model, we see that our project portfolio grew quite rapidly bit too wide. When we move forward, we will focus to ensure that step by step the franchises that we have, the games we are developing, can become larger successes, and when we do, we have even more capabilities to continuously build, utilize, and benefit from synergies across our game portfolio. The synergy part is highly important to us. Done right, this allows us to truly build bigger franchises step by step with great games and sequels that come out more regularly. Games that can build on high-quality components already proven in our other games, and on top of that, we can put extra effort and innovation per game to areas where it matters the most. This also will allow us to utilize Remedy's Connected Universe better, gives efficiency, and really helps us to punch beyond our weight. So when we develop games, one part of the already early-phase consideration is that what do we already have, not just based on the past game but across our gaming portfolio in terms of people and know-how, Northlight technology and tools, shareable assets, and content pipelines that we are using. And then, of course, also connecting games to each other and sharing resources and knowledge between our game teams. Now, in our internal planning, we, of course, have return on investment targets for our games. What they exactly are, it always slightly varies between the games, but nowadays the minimum expectation for return on investment is 100%, meaning that in the early planning phase, the games are planned and later developed and supported with the mindset that at least they have to earn back double the money we invested overall into them. That was actually then already said. Just to highlight, this is the minimum target for every future game. Our people also, they are behind this. We all understand that when we earn back at least double the money invested, first of all, we get back the money invested into a game, but we also generate profits to pay the development and marketing of the next game. This is the way to enable real full freedom to always be able to choose the best way forward with our franchises and games. We see that we have all the means to do it. Good, successful games overall in this industry generate much more. Reaching this target, the action areas that we are doing as a company is that definitely we continue developing great games, but it's important that gradually, when we do the early pre-productions, we are able to then also make decisions that can meaningfully expand the audience and sell more games eventually. We are putting effort both by ourselves and with our partners that we have successful marketing, sales, and community management. We are putting a lot of effort into the portfolio and project management and leadership side so that we have well-managed productions where creative ambitions, technology ambitions, our capabilities development-wise, budgets, and schedules are aligned. Then, of course, now as an example, a big decision that for each game we need to make sure that we have the right publishing model and partnerships all playing in place that then support us to reach the success that our games can reach. Then an important topic, of course, how do we grow these franchises? When we look at ourselves now where we have developed as a company, we have two key business areas that support each other. On one hand, we have our own franchises where we have Control and Alan Wake connected by the Remedy Connected Universe, and then we have partner franchises work for hire. When we look at the objective with the partner franchise, it's very clear: Max Payne, even though it's not owned by us, we feel that in many ways it's ours. We have high passion for the game. It's a game that was originally created by us. The team loves to work on the game. We will make an excellent, commercially successful Max Payne 1 and 2 remake with Rockstar Games. At the same time, what we are doing as a company is that we are building ourselves a strong Remedy action game team. When we reach these objectives, it will give us significant strategic options for the longer-term future to freely decide whether we will continue working on potential partner franchises or with our own franchises, be they Control, Alan Wake, or at some point in the future to start creating a third new bigger owned franchise. With our own franchises, we see that when we go forward by two iterations, by 2030, the aim is clear: we will grow Control and Alan Wake from the current established franchises to super franchises. In more detail, what we mean with that: we see that Control and Alan Wake have now been established. It's Control based on one game, Alan Wake based on two games, but basically no regular sequels yet in these games. We see that these franchises, they are highly appreciated and well-known, but only by a subset of core players. The players have limited reason currently to stay with the game or the wider franchise, but they are established. The revenues are approximately in the range of EUR 100 million-200 million in a three-year time window per franchise. The step within the next six-seven years that we aim to make is that these franchises will be based on three-four games, and we have the capability to introduce regular sequels. These franchises will be highly appreciated among core players and well-known by the wider player audience overall. Players will have reasons to engage with the games and franchises for a longer time, and the revenues have grown to EUR 500 million per three-year window per franchise. This is definitely, we know, very doable. We look at the gaming market, the AAA games, we know approximately how much they are selling. There are so many gaming franchises that make much, much more. Overall, when we then look at our franchises, we see that they can grow step by step. They offer also potential for new experiences and audiences. What we have unique at Remedy is the capability to develop high-quality, distinctive games, but also the ability to create immersive worlds, interesting character stories, around these characters. These are typically the building blocks of not just individual brands but franchises that can grow and expand into new experiences and audiences. We see that at the heart of what we do in our franchises are going to be AAA sequels that step by step grow bigger, more successful, and reach also new audiences. But these worlds we see can also expand into new spin-offs, and Condor is an example of how we are now aiming to expand Control franchise also into a multiplayer game. Partly, we see that these games can tap into the same audience, but the big objective is also that they should step by step expand the audience into a new direction. Then, when we go longer-term in the future, we don't yet have concretely anything going on here, but we see that there are then potential future expansion opportunities. Many franchises already do. We have that opportunity to do supportive transmedia, which typically deepens the experience for the existing fanbase via books, comics, something that is still fairly kind of like straightforward to do but provides value for the existing gamers. TV and film: we have seen that franchises that have immersive worlds provide that opportunity, and in the recent years, we already see some franchises that have successfully done it, meaningfully, significantly expanded the audience, and it has been a direct benefit for the games they have. Then the fourth principle that we have, which is guiding, is that yes, we continue on the path. We have started it for a long, long time ago to strengthen our position in the value chain. We are now aiming to make sure that also going into the future, we have a strong position with which we can maximize the franchise's potential and then also the benefits that it brings to us. Of course, as has now been said a number of times, this is a very unique situation. The future of both Alan Wake and Control is fully in our hands. We are now carefully evaluating the next step. It's good to highlight how unique this situation is. Normally, when gaming companies get an external publisher to finance the project, it almost always includes sequel rights. In reality, companies are not free to choose the next partner for the next game. Now, Alan Wake is free. We have had excellent collaboration with Epic Games, and it can well be that we continue with Epic Games, but it's now in our own hands to decide whether we do that or not. Control, buying back the rights, returned all the rights to us. This is now the first time, at least in the last 20 years when Remedy has been in this situation, that we have an existing game and a proven franchise, and it's fully in our hands to decide what we do. This actually then tells the same story in a bit more detail. So as a backbone of our business, we have for a long time had a partner franchise, a subcontracting business that we are working on. Currently, that project is Max Payne 1 and 2 Remake, an absolutely perfect fit for us, our team, our skills. We love working on that game. Then we have had two models how we have been rising up in the value chain. We started it first with Control. In 2017, we made a publishing partnership deal with 505 Games, but also in order to get that deal, it was the best deal definitely in 2017 that we could get. But then the partner also, in order to get that deal to us, they received long-term sequel rights for the Control franchise. Then, as a next step in our development, in 2020, we made a publishing agreement with Epic Games on Alan Wake 2 and Alan Wake Remastered. It's been a great collaboration. We are really happy with what Epic has been doing with us. And as said, it's fully possible that we continue working with Epic also in our future games. But the situation is that on that deal, the partner has no sequel rights, so it's fully in our hands to decide whatever we will do one day in the future with Alan Wake. Then with Tencent, we closed the deal with Vanguard, and again, as normal, as quite the normal part on the publishing agreement, Tencent has and received certain selected future rights. And then with 505, we made the co-publishing deals during the past couple of years, and again, a really good step up to us in the value chain, but the partner again received long-term sequel rights for these games. And now the situation is that we are free to choose what we do, both with Alan Wake and with Control. We already know that the original Control game from early 2025 will return to us, so we have an additional back catalog game that we are self-publishing, and we are currently now really carefully choosing what's the best future model for Condor and Control 2. It's basically going to be a choice between publishing by partner, co-publishing, or self-publishing. If we go the route of publishing by partner, of course, the partner would most likely provide major financing, lead the commercial actions, the partner would then recoup their investments, and the revenues would be shared. It would be a lower risk for us, constant revenue also during development, and with the right partner, the games can then sell more. However, if the game becomes a big success, it's also quite expensive money because the partner is recouping their investments, and then we are sharing the revenues, plus quite often this may tie us to that one partner for a longer term. On co-publishing, it would be a shared financing, a bigger commercial role for us, most likely direct community management as an example. Both parties would recoup their investments, after which revenues would be shared. It's more risk for us. It's some revenue during the development. It's higher revenue and cash after the launch, especially if we would be a direct publisher either in certain geographies or certain platforms. But this also typically ties us long-term to a selected partner. Self-publishing would be, as Terhi explained, fully funded by us. We would lead all the operations, both in development and commercial side. It's definitely higher risk but also higher upside, and we would have the full franchise control. When considering these options, it's not just the consideration of the publishing options, but we need to then also evaluate different financing options, whether it's project funding, do we consider convertible bond in a way, financial investment. For years, there has been interest for strategic investments. Nowadays, there is a possibility to make business-to-business deals on the subscription services. So the good thing is that there are different options to evaluate because we know we have great games in our hands, and Remedy is a lucrative partner for many industry players. In any case, I think what we will have during this year is that we will have a model, and we will have deals for Condor and Control 2 that are better for our future compared to what we had. So just shortly, just to summarize, we see that we now have two established owned franchises, Control and Alan Wake, with major growth potential going in the future. And we also have the unique situation: we are free to decide the best way forward. We also have Max Payne, an excellent fit to us, an important game which provides both short and long-term benefits for the company. We have great games now in development. They have good potential, and our capabilities to make these games bigger successes are better than they have ever been. So this is the high-level direction. I thank you all for listening to me a bit longer time now than normally, and once we get more clarity on the model for Condor, Control 2, the strategy is set in place. We will give an update. But on the presentation part, that's it. Thank you, Tero. Thank you, Terhi. Now we go to the Q&A. If you want to ask questions, type in your question into the chat or in the Q&A, I mean. We are now ready for questions. There's a bit of those there already. Let's kick off. What kind of expectations do you have for Alan Wake Remastered royalties going forward? Well, we don't guide how we see the specific project royalties going forward, but as we have seen, there is a long-term sales potential for the franchise overall, and that game being high quality, well received, and also having the possible sales synergies with Alan Wake 2. I think we have realistic but good expectations. Good. External development costs going forward: should we expect a similar run rate as we had seen in Q4? Well, we cannot compare quarter-to-quarter in any of our net revenues, not cash flow, not expenses because they all relate to the different projects we have in hand and the stage in which our projects are. For example, now having the Max Payne remakes ongoing and really getting into the full production, I would say that we'd rather have more outsourcing than less because then outsourcing external development is the main means for scalability for us. What about the balance sheet? How do you view the current balance sheet status? If a new partner deal is delayed for Control 2 or Condor, would an equity issue or bank debt be needed until we reach profitability? Well, like Tero just explained, if something is sort of delayed or if we choose to go for self-publishing nonetheless, then of course we would need to look for the financing side. And there are several options, like also project funding, peer-to-peer deals, strategic investments, etc., etc. So surely we keep an eye on that. Yeah, yeah, yeah. And I can add into that that of course we then keep the, in a way, investor market also in mind that the market situation is not the best one to do traditional, in a way, capital raises. But as we discussed, we don't want to speculate too much, but we are in a fortunate situation that there are a number of different options that we can consider. Getting back to Condor and Control 2, what do we look for in a new partner for both or either one of these games? Well, of course, the driving force is our strategy where we are aiming at and what we want to be as a company. As I just presented, one of the key parts is that we now have two established franchises in our hand. Typically, these are the biggest value generators in the entertainment industry in the long term. How can we now have a model and a partner with which we can build these franchises into the super ones, major ones that they have potential to become? What could a partner bring on the table there? How, in a way, long-term commitments would we need to do? What type of terms can we get so that the success also builds significant success to Remedy? These are, as an example. And then, of course, of course, we are evaluating, as was asked, that to build these into long-term successful franchises, they do require investment. So there is the risk part also in consideration that what does the partner bring on the table? Do you believe that the total project return on investment for Control 2 and Condor will be higher or similar or lower now that we have acquired the publishing rights and are free to look for a new partner? Well, as I presented just a moment ago, that the minimum target for any of our games is 100%. And we now think that Control has been very well received. When Control launched, it didn't have any fan base at the start. Now we definitely have been able to build a certain fan base. The starting point for the next games is stronger, and we definitely have means to create bigger successes all the time, step by step, as we go into the future. Good. With two large projects nearing full production, Control, Condor, and Max Payne, and one being in the production readiness stage, will Remedy have the operational capabilities to handle this and to release one game per year during 2026-2027? Yes. And it's a good observation that that is now happening. But again, as was presented, we have now grown to 400 people. The external development capabilities have improved. And one key area where we have improved, and that has been also the learning from Alan Wake 2, is that when a project faces challenges in the production phase, which is a highly important phase and also the most costly one, typically the reasons originate in the pre-production phase. That is the pre-production phase where we still have a smaller team, where we are still designing the game, we are proving everything, we are building the pipelines, making sure that we know exactly what should be done in the production. Is that pre-production phase done well enough, and are we demanding enough before we let the projects proceed in the next phases? In the past, we haven't been, but it's been a long learning process, and now we have definitely used that for the current projects that are moving further. We also now have 400 internal people, better capabilities than we have ever had in the past, and we are not adding new projects at the moment. So Max Payne is now moving into production. It's a big one. But then the second one that is moving, we need to bear in mind, Condor, it's about 50 people. It doesn't grow much bigger than that, slightly with some new people, but also because it's a multiplayer game, there are people with slightly different profiles than we would need for the other game. So overall, I would say that we are in a good position now to take these ones further, and we keep on improving all the time. And definitely, I have no doubt that we can release games in that schedule that was asked. A couple of other operational questions. Does Remedy have a strong enough marketing and publishing team to self-publish Condor or Control 2? We have a good basis to build on. Now, again, as I mentioned, we have 14 people in our internal publishing unit, and that publishing unit has also been working with publishing. So in Control, it was our IP. For years, we have been hand in hand collaborating with 505 Games, doing certain parts, learning on certain other things, so we know how they have done the marketing of Control. We have now also done the same with Alan Wake 2 with Epic Games Publishing. We have seen how they have done. Would we now immediately have all the required personnel, especially for a big AAA game? No, we wouldn't, but we know what is needed, and it would be, again, a kind of like a development path that we would need to take to make that happen. But work to be done, in a way, not an easy one. I think something that we could take if the other parts on the financing side would align. What about Remedy Stockholm office? What projects have they been working on, and how would you review the work of the studio since launch? And has it been a good investment, good move to set up a studio there? It's been supporting all our projects. We, in a way, expanded to Stockholm during the pandemic with the idea that we saw, well, overall, I say background, the bar for new Remedians has always been high. We look for the best talent in the industry. We started to see that, in a way, Stockholm actually has a lot of PC experience, PC and console game developers that are interested in working with Remedy. When we just announced back in the day the plan to open an office one day in Stockholm, it increased the number of really high-profile, high-quality developers. And from that point onward, it's been a major talent pool for us. We haven't yet had any individual projects being led fully by the Stockholm office. There are certain competence centers around certain disciplines and crafts where we see that we can attract the talent, especially from Stockholm. There are certain subteams that are a bit bigger for specific teams that we have in Stockholm, but it's been a great support for our game projects, and we are a gaming company, so nothing else in that sense as is important. Good. After the key events and uncertainty in the market for past months, what should Remedy Entertainment shareholders expect for the future development in line with the long-term objectives of the company? Let me now think what is asked here after the uncertainty. Well, definitely what you should expect is that Alan Wake 2 now continues to sell well, and the time to start receiving royalties should not be too far away because we have said that it should be a revenue and profit driver for us this year. And then definitely in our industry, you should look if our projects are proceeding according to the schedules and are aiming for the more regular game launches that we have said we need to reach. Good. Then returning to the finance side of things, you have said that the cash flow effect from Control transaction will be clearly less than the purchase price of EUR 17 million approximately. What does clearly mean? Millions. Millions. Thank you. Generally speaking, are development payments in co-publishing contracts based on milestones or actual development costs? In other words, is there equal or more risk sharing in development risks/costs compared to traditional publishing contracts? They are almost always tied into milestones. The basis is that, yes, there could be a possibility just to tie it into realized cost, but then at the same time, the partner never has full control on our projects. We have the creative freedom. We are the party who is deciding how we staff our projects, with what type of plans we are proceeding with them. And in many ways, the only concrete way with which our partners can often follow the projects are with the milestone bills that they get and comparing the milestone deliveries to the plans that we have had. So typically, there are certain models, in a way, how they can be put so that it's whether it's a monthly milestone, two-month, whether it's four times per year. But typically, always, it's tied to certain type of milestones. Does it seem that the initial development budgets for Condor and Control 2 are still holding? Well, what we internally always consider, that we have internal targets that we set for the team, and then we also know that as the pre-production is done, we evaluate that, and there is a certain window within which we operate, and we are within that window. There's a question on a physical version of Alan Wake 2, so a physical copy of the game. Is this something that is in the making, and can it impact meaningfully our profits and sales? The game has been launched as a digital only, and we haven't, or Epic, our publishing partner, hasn't yet communicated anything else. So I'm not speculating that here. Good. Thank you. I think that was all the questions for today. Thank you, Tero. Thank you, Terhi. Thanks to all the participants in the call and all your questions. We'll be back with the next earnings webinar. That is our business review, January-March 2024, on April 29th. That's all for now, and have a great rest of the week.