Angry Birds maker Rovio Entertainment reports profits fall
Finnish mobile games maker suggests new user acquisition costs are to blame
Rovio Entertainment, the Helsinki based maker of the Angry Birds mobile game series, has reported a 48 per cent drop in its quarterly profit year-on-year.
The company, which listed its shares in 2018, has seen sales grow 5.4 per cent year on year to €74.8m (£63.5m, $83.2m), however its its third-quarter operating profit was €5.4m significant drop from the same period in 2018.
CEO Kati Levoranta said that the fall in profits was largely due to the increased costs of attracting new players. The company launched a new flagship game in January, Angry Birds Dream Blast, and has invested significantly to acquire new users and drive its growth.
A second new game, Sugar Blast, based on the Angry Birds Dream Blast core gameplay, was launched late in the quarter and didn’t contribute significantly to the quarter’s financials.
Levoranta said: “during the quarter the largest user acquisition investments were made in August, around the release of the Angry Birds Movie 2, which gave us a good opportunity to boost our key games”.
In 2019, Rovio expects group revenues to grow to €295 – 310m (2018: €281m) with adjusted operating profit margin to be between 5 and 8 per cent (2018: 11.1 per cent).
Earlier in October, the company announced plans to restructure its licensing division cutting 20 jobs. However the company confirmed that its licensing segment revenues are expected to be at a similar or slightly higher level in 2019 with focus on the second half of the year after the release of the Angry Birds Movie sequel.