Games revenue grew 6% in comparable currencies in the second quarter

Article Financial Update default 12.08.2021

Alex Pelletier-Normand, CEO:

The first six months as Rovio’s CEO have been rewarding. Not only have we been growing y-o-y in comparable currencies, against Q2-2020, a quarter that largely benefited from the beginning of the shelter-at-home situation, but we also made strides in the execution of our Angry Birds brand and our M&A strategy. The organization stays active and motivated; we are eager to continue executing at a fast pace and believe that our market positioning improves with each step we take.

Looking at our live games, the good momentum we saw in the first quarter continued in Q2. Games revenue grew 6% in comparable currencies. The main revenue drivers were Small Town Murders (globally launched in June 2020) and Angry Birds Friends. We are proud of our Angry Birds Friends team for this continuous performance of the oldest game in our live portfolio. Also positive was the scaling of Small Town Murders during the quarter, which was the third consecutive quarter of growth for the game.

Regarding our new games, we launched Darkfire Heroes in April, from our Copenhagen studio acquired in 2020. As of today, we have not yet been able to reach a scale fitting our ambition level. The team is expanding the game with additional events and content, and we search ways to improve our marketing efficiency within this mid-core category, which is new to us. We also made the decision to cancel our 4x strategy game Hardhead Squad which was in soft launch. We did not see enough potential for a global release, and we believe it is important to focus our resources where they can make the biggest impact. I want to thank our team for their hard work throughout the development of the project.

We have two other games, Supernatural City and Angry Birds Journey, in soft launch, and their development is progressing as expected. Finally, during the quarter we released the Apple Arcade title Angry Birds Reloaded, which quickly reached the #1 position of the chart. The Angry Birds fans were delighted, to the extent that we saw a positive impact also on Angry Birds 2, which reached a 12-months download peak soon after the release of Angry Birds Reloaded.
In June, we were thrilled to announce a long-term partnership with Moomin Characters and Gutsy Animations, granting us the exclusive rights to develop Moomin based mobile games; the first one being scheduled to reach soft launch this year. This is in line with our brand strategy: in an industry increasingly dominated by paid advertising, leveraging strong brands through high-quality game experiences is an efficient way to drive organic downloads and decrease acquisition costs. Having now two established and beloved brands as platforms to develop games in the years to come is placing us in a good position. With that in mind, we continued to develop our Angry Birds strategy: we worked on an ambitious product roadmap, and we engaged in a closer and more genuine relationship with our fans. I am happy to see that this strategy bears fruit already. The community is excited and eager to engage with our games in development.

Today, we announced the acquisition of Ruby Games, a hyper-casual studio with an impressive track record, located in Izmir, Turkey. Our investment in this market segment is beneficial for both companies as we create a larger network of users that can navigate a more diverse portfolio of titles. The modifications concerning user privacy policies operated by distribution platforms and policy makers make precise user targeting harder, thus building a wide and efficient ecosystem that keeps players engaged longer is a true strategic advantage. In addition, hyper-casual remains a growing segment, and the acquisition will help us better balance our revenues, increasing the share of our advertising business. We are very excited to have Ruby Games joining the flock.

During the last 17 months of remote work, we witnessed how Rovians are resilient, agile, and driven. They find innovative solutions to get the job done in difficult circumstances, while remaining supportive of each other. We are also mindful that in order to excel at creative and collaborative work, being able to brainstorm face to face with colleagues is valuable. With this in mind, we are moving as soon as possible to a flexible hybrid model, respectful of the individual situations of rovians, and adapted to each project’s needs. We believe that the best people to make decisions on their project policy are the teams themselves; and we will empower them to do so.

Link to full report here.