Supercell suffered its first ever fall in income and a big drop in gross sales because the Finnish group turned the newest star of the cell gaming business to wrestle.
Bought by China’s Tencent 18 months in the past at a valuation of €10bn, the Finnish group noticed its revenues fall by about 14 per cent to €2.1bn in 2017 after stagnating the earlier 12 months. Earnings earlier than curiosity, tax, depreciation and amortisation dropped 20 per cent to €729m.
Supercell dominated the cell gaming business for a lot of this decade with a singular technique of solely releasing a number of video games. It has simply 4 titles — together with Conflict of Clans and Hay Day, which each celebrated their fifth anniversaries final 12 months — however has struggled to duplicate their success.
It didn’t launch a brand new recreation final 12 months however has one known as Brawl Stars at the moment in beta testing in Canada.
“Our headline numbers for the 12 months are usually not as excessive as final 12 months, as we didn’t launch a brand new recreation globally. Our imaginative and prescient is to create video games for as many individuals as doable, which are performed for years and remembered endlessly. That’s clearly an insanely excessive bar to achieve,” mentioned Ilkka Paananen, Supercell’s founder and chief govt.
The group has confronted questions about its so-called freemium enterprise mannequin — which supplies clients the video games without spending a dime however pushes them to purchase enhancements — after its final title, Conflict Royale, noticed falling revenues quickly after launch.
But it surely has positioned Conflict Royale as an e-sports recreation, holding one event that 27m gamers participated in with hundreds of thousands extra watching on-line. Supercell has additionally begun buying up smaller video games corporations, together with House Ape Video games within the UK and Shipyard Video games in Finland final 12 months.
With solely 241 staff, it has change into one among Finland’s Most worthy corporations, and Mr Paananen and different senior staff repeatedly prime the record of those that pay essentially the most tax within the Nordic nation.
Buyers, nevertheless, have change into more and more cautious of cell gaming after seeing a variety of former stars fail to breed their blockbusters, reminiscent of Zynga with FarmVille and Rovio with Offended Birds. There have additionally been questions from regulators over how some gamers — identified within the business as whales — can spend hundreds of euros on particular powers or short-cuts.