Photo by BagoGames
Today, the shares of Rovio, the Angry Birds maker, took a battering as it reported a loss in the company’s maiden results as a public company.
The company’s loss before tax amounted to €500,000 (£445,000) for the three months to September, compared with €4.6m profit in 2017
The loss was despite a rise in sales from €50m to €70.7m.
During the period, the company invested a total of €22m in games.
In September, the company floated for nearly €900m on the Helsinki stock market. However, its debut results as a listed company sent shares dropping 22 percent, decreasing its market value to about €717m.
However, the company was positive about meeting its full-year targets, including an increase in its underlying profits.
The major investment which weighed on the profits of the group this period was placed into user acquisition for the company’s top-performing games, a strategy which the management said was paying off.
New spin-offs of its Angry Birds brand, its flagship brand, have proved to be popular. Brand licensing for the creation also brought in additional revenue off the back of the Angry Birds movie.
Kati Levoranta, the company’s Chief executive, stated: “Rovio’s Games business achieved strong growth in the third quarter. The Games business unit’s revenue increased by 40 percent year-on-year, boosted by the improved monetisation of top games.
“We significantly increased our investments in user acquisition, and at the same time in future revenues, for our top-performing games: investments increased to €22m in the third quarter, which, as expected, reduced the profitability of the Games business unit for the third quarter.
“We expect the payback time for these investments to be 8 to 10 months.”