Alex Pelletier-Normand, CEO:
I’m delighted to see that Rovio continued good progress in strategy execution throughout the year with a strong finish. In the fourth quarter, we saw strong growth and record high revenue in Games. This achievement was driven by the good performance of our key live games, especially Angry Birds 2 and Angry Birds Friends, and the acquisition of Ruby Games. Our full year and Q4 profitability and cash flow remained at a good level. Despite a second year of pandemic and changes in the marketing landscape driven by Apple’s new privacy framework, we performed well. This would not have been possible without the utmost dedication of all our employees, I would like to thank all Rovians for their contributions and commitment throughout the year.
We finished the year with a strong fourth quarter. All our top three games Angry Birds 2, Angry Birds Dream Blast and Angry Birds Friends grew year-on-year. Our teams crafted successful holiday campaigns, improving game KPIs and enabling higher UA investments. Rovio’s largest game, Angry Birds 2, recorded the highest gross bookings since Q1 2019 and grew double digit year-on-year. Angry Birds Dream Blast also grew year-on-year; the game has proven to be another stable pillar for Rovio, crossing the bar of 180M euros in revenue since its launch in 2019 and showing still growth potential. Further, it was remarkable to see our third biggest and oldest live game, Angry Birds Friends, record its fifth consecutive quarter of growth, thanks to seasonal content and special offers. We are celebrating this month the 10th anniversary of this fan-favorite title. Ruby Games had a solid quarter based on its hyper-casual game portfolio while their first hybrid-casual game, Hunter Assassin 2, reached soft launch.
Q4 was also a quarter of finalization for the launch of Angry Birds Journey, which was released globally in January 2022. The game’s KPIs are promising – the annual revenue run-rate is over EUR 40 million, which makes it Rovio’s third largest game. The team has done a tremendous job and we have exciting content coming to our players.
At the end of last year we said that we’ll be making announcements on different brand initiatives as part of the “Angry New Year”. We have been active, and the strategy unfolded as planned. Among other things, we partnered with the widely popular gaming platform Roblox, and Angry Birds: Summer Madness, the first Angry Birds long-form animated series, premiered on Netflix in January. Those events got our fans excited; further initiatives will surface later this year.
During the year the mobile gaming industry remained dynamic and major changes occurred in the marketing landscape driven by growing awareness on privacy matters, resulting in increased regulation and policies. We were ready! Our versatile tools, our collaborative ways of working and our wide-appeal portfolio – spearheaded by the strong Angry Birds brand – allowed us to maneuver this volatile environment successfully.
Those changes also encouraged us to refine our strategy further, and we made the decision to double-down on casual games, leveraging our core expertise and maximizing the value of our network of users. To support this, we strengthened our talent pool by acquiring the hyper-casual studio Ruby Games in Turkey, and by opening a new casual mobile gaming studio in Toronto, Canada. Finally, we formed a multi-year partnership for mobile gaming rights for the beloved Moomin IP. The first Moomin game, Moomin: Puzzle & Design, was soft launched in December.
Another key area where we advanced during the year was sustainability. We want to lead the industry in creating safe and joyful gaming experiences that are crafted in a diverse and inclusive work culture while respecting our planet. We appointed our first-ever Chief Sustainability Officer to lead the charge in our 3 focus areas: Safe & Responsible Gaming, People & Society, and Climate & Environment. One example of our engagement is our collaboration with UNICEF to support adolescent girls in Senegal and our three-year commitment to support their education program in Sierra Leone. We also offset our carbon emissions and pledged to reach carbon neutrality in 2022.
As we enter the new year, I am energized about the opportunities ahead. We start the year with positive momentum in our top live games, now including Angry Birds Journey. Our games pipeline beyond 2022 is healthy with new games in development in all of our seven studios, and we have exciting brand initiatives in this “Angry New Year”. We continue our M&A efforts, aiming to build new growth avenues within casual games, grow our audience network, and establish value through synergies across our game portfolio and studios. I believe that Rovio is well positioned to continue to drive long-term growth and deliver on our mission: craft joy with player-focused gaming experiences that last for decades.
Building on the positive momentum in our top live games, the launch of Angry Birds Journey in January and having the full benefit of the Ruby Games acquisition from the start of the year, we are expecting strong topline growth for the year. Depending on the speed of growth and the investments in user acquisition to fuel that growth, especially in the case of new games, and our larger investments in new games development, the adjusted operating profit is expected to be lower year-on-year.
The user acquisition investments for Q1-2022 is expected to be around 40% of games revenues.