By Ben P L [CC BY-SA 2.0] via Wikimedia Commons
Rovio, the Finnish games developer, is set to close its year-old London studio following disappointing financial results observed the company miss its revenue targets.
Rovio made sales amounting to €73.9m during the final three months of last year, versus the analyst estimates of €77.3m, disappointing its investors months after the initial public offering of the company on the Helsinki Stock Exchange at a valuation amounting to €950m. Shares of the company dropped by 10 percent to a new low of €4.30 after today’s announcement.
The maker of Angry Birds that based in Helsinki announced that Willhelm Taht, the head of games of the company, will also leave the firm after last week’s share price drop by 50 percent amid a profit warning.
Rovio has had a difficult time to capitalise on the early success of the company’s Angry Birds franchise, with the company developing the mobile game into a film series with the 2016’s Angry Birds Movie.
Rovio had planned to establish a 20 person London studio. However, only about seven people were ultimately hired, to lead its effort into multiplayer and massively multiplayer games online.
On Twitter, Mark Sorrell, the London studio head, said: “Sad times for us, but I look back with genuine pride at my time with these talented and kind people. Been quite a ride.”
Rovio had seemed to be returning to growth following losses in 2015, after the failure of disappointing games such as Battle Bay and Love Rocks to improve profits, resulting in job cuts. The film franchise of the company was able to improve margins, resulting in the launch of its branch in London in January of 2017. However, in its latest results, the company said that the income from the Hollywood movie and licencing had continued to drop.
Reuters reports that Kati Levoranta, the chief executive of Rovio, stated: “Competition in the market intensified a lot during the fall … but our business fundamentals are healthy, looking forward.”