Rovio Entertainment, maker of the popular “angry-birds” mobile game series, has recorded a nearly 75% rise in its first quarter profits. The stark rise in company profits was fueled by cost cuttings, along with stay at home orders that have diverted people to online games at record pace.
The company has announced that its adjusted operating profit rose to 13 million Euros from 7.5 million. Interestingly though, the revenue fell 6% to 66.6 million euros. From 3.3 million euros, the operating cash flow increased to 11.5 million euros. “Rovio’s first quarter of 2020 was characterised by an improvement in profitability and operating cash flow” said the company in its interim report for the quarter.
According to the report, the company’s high profitability was driven by the low level of user acquisition and stability of its key games, especially angry birds 2. The quarter recorded positive responses from users after the company released a series of updates within Angry Birds 2, Angry Birds Dream Blast and Sugar Blast. Additionally, many new games entered the marketability test.
Games form a part of the large digital world which is one area that has seen record user growth since the onset of the coronavirus pandemic. The company said “In our games, we have seen an increase in the number of downloads as well as user engagement and also some uptick in the revenues in March and April. However, it is too early to quantify and distinguish the impact of corona pandemic and game improvements”.
With regards to user acquisition investments, the report highlights that the company had to scale down on these to meet payback targets. Following this, the company experienced considerable stability throughout the quarter.
The report also announces the launch of Rovio’s new game ‘Small Town Murders’ which is scheduled in June. The new long-form Angry Birds animation series is set to be released on Netflix in 2021, a highlight for the company’s developments within Brand Licencing.