How FortifAI Slashed Losses 72% Amid Board Shakeup and $3.6M Capital Raise

Financial Performance and Cost Management

FortifAI Limited, formerly Mighty Kingdom, released its preliminary results for the fiscal year ended 30 June 2025, revealing a mixed but cautiously optimistic financial picture. The company’s game revenue fell 15% year-on-year to $4.3 million, reflecting challenges in the competitive digital entertainment sector. However, this decline was offset by a disciplined focus on cost control, with operational expenses slashed by 43% to $8.2 million. This efficiency drive contributed to a substantial 72% reduction in net loss, which narrowed to $1.99 million from nearly $7 million the previous year.

The company also reported total income of $6.3 million, which included government incentives such as research and development tax offsets and grants, underscoring FortifAI’s ability to leverage available support mechanisms to bolster its financial position.

Capital Raising and Balance Sheet Strengthening

FortifAI successfully completed multiple capital raising initiatives during the year, securing $3.6 million net of transaction costs. These funds were raised through a combination of entitlement offers and placements, including a notable $2.3 million placement in late June 2025. The capital injections have strengthened the company’s balance sheet, increasing net tangible assets per share from 0.12 cents to 0.61 cents, and providing a solid cash position of approximately $3 million as of June 30.

Alongside the capital raises, the company undertook two share consolidations, a 15 – 1 consolidation completed in August 2024 and a 5 – 1 consolidation finalized in July 2025, aimed at optimizing its capital structure and enhancing shareholder value.

Leadership Changes and Strategic Focus

The year saw significant changes in FortifAI’s leadership and board composition. Managing Director David Yin resigned in November 2024, with Dylan Miklashek stepping in as Interim CEO before transitioning to a non-executive Studio Director role. The board welcomed new appointments including Chair Shannon Robinson and Finance Director Andrew Scott Cole, while several directors stepped down. These changes coincide with a strategic review and organizational restructuring designed to streamline operations and align the business with its growth priorities.

Operationally, FortifAI maintained strong partnerships with key industry players such as East Side Games Group, Google, and Spin Master. Noteworthy projects include ongoing development for titles like Star Trek Lower Decks and Power Rangers – Mighty Force, as well as innovative collaborations like game content for Google’s Fitbit Ace LTE smartwatch. The company is also focusing on integrating artificial intelligence capabilities to expand its project pipeline and drive future growth.

Outlook and Market Positioning

Looking ahead to FY2026, FortifAI positions itself for a period of consolidation and targeted growth. The company emphasizes profitability and operational efficiency, supported by a strengthened balance sheet and a clear strategic roadmap. The integration of AI technologies is highlighted as a key enabler for expanding the company’s offerings and competitive edge in the evolving digital entertainment landscape.

While the financial statements remain unaudited pending review by Grant Thornton Audit Pty Ltd, the preliminary results and strategic initiatives suggest FortifAI is navigating its challenges with a pragmatic approach aimed at sustainable recovery and value creation.