Alex Pelletier-Normand, CEO:
I am pleased to see that we have continued to perform well in a challenging market in the third quarter. Our reported revenue grew 8.4% and our comparable revenue declined 4.6%, during a period in which the US market declined over 15% year-on-year. The performance of our live games, especially Angry Birds Dream Blast, the consolidation of Ruby Games, and a favorable fx supported those results.
The same market headwinds continued as in the previous quarter. However, it is interesting to note that the quarter-over-quarter decline was only 1% in the US in Q3, showing a positive development after five consecutive quarters of decline. We continue to believe that long-term growth opportunities look attractive in the mobile gaming market.
We took advantage of the past months to launch meaningful initiatives aimed at strengthening our position for further growth as the market recovers.
Angry Birds Dream Blast leading the way
One of these initiatives is an enhanced focus on our portfolio of live games. We increased the resourcing of our live games and the depth of our live operations, and we can already see the benefits of such actions. For instance, our second biggest title, Angry Birds Dream Blast, grew double digits both year-on-year and quarter-on-quarter. This is an amazing achievement from the team, who have worked relentlessly to improve the game’s quality and marketability since its launch. The run-rate of the game grew to around EUR 20 million per quarter at the end of September.
Angry Birds 2 continued to perform well, growing both quarter-on-quarter and year-on-year driven by good live operations and solid UA performance. We have exciting new content coming to the game later this year. For instance, for the first time since the release of the second Angry Birds Movie in 2019, we plan on introducing a new bird in the game.
Angry Birds Friends declined slightly from the previous quarter. The game was impacted by an issue with our partner Meta, causing some players to temporarily lose access to their progress. This resulted in a short-lived gap in revenues. After remedying the issue, we saw the game’s daily active users and revenue run-rate recovering.
Two new studios supporting the growth
To support the growth of our top live games, we are opening a new studio in Barcelona, Spain. This initiative will widen our talent pool particularly in live operations and level design – an activity that is today widely outsourced. Recruitment is ongoing and we aim to hire 15 developers in the next 12 months, who will support our Puzzle studio in Espoo.
In other exciting news, in Montreal, a team of industry veterans decided to jointly leave their former employer to join Rovio. They are specialized in very fast prototyping and market tests and aim at producing hybrid-casual games. They are internally called “Studio 6” and we are delighted to have them on board.
Healthy pipeline of new titles
We’ve also made good progress in our new games development. Moomin: Puzzle & Design is developing as planned and enters the next soft launch test at the beginning of the year. Our Puzzle Studio is also working on a new Match-3 game that builds upon the learnings of Small Town Murders. The game looks promising and will have its first marketability and early retention test in December. In Montreal Studio, we refocused our team on expanding Angry Birds beyond mobile with a multiplayer cross-platform game targeted for Gen Z. As of November 7th, the studio will be led by console gaming veteran Andréane Meunier who has over a decade experience at Ubisoft. Ruby Games, Toronto and Copenhagen are also advancing well in their new games. Overall, our pipeline is healthy with 10 new titles in development across our studios.
In brand news, as part of our Angry Birds content strategy beyond games, the third season of Angry Birds Summer Madness was released on Netflix in August. The success of Angry Birds animation was highlighted in a recent Rovio commissioned consumer study where, among teenagers aged 12-16 in the USA, Angry Birds was the third most watched series on Netflix.
We are excited to enter the last quarter of the year, which is typically the most eventful season in games. We start the quarter with good momentum in our top games and a stream of seasonal events to drive fan engagement across the portfolio.
With our two new studios, a strong focus on live games already showing results, and new games progressing well, we see Rovio well positioned to capture growth opportunities in 2023 and beyond. I am excited to continue leading these efforts and I am proud of Rovians’ resourcefulness in continuously finding growth opportunities.
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