Angry Birds maker Rovio needs new games to revitalize sales

Rovio grew rapidly after the 2009 launch of the original ‘Angry Birds’ game. (AFP)
Updated 16 November 2018

Angry Birds maker Rovio needs new games to revitalize sales

  • Rovio said tough competition and high marketing costs would put pressure on its full-year outlook
  • Rovio grew rapidly after the 2009 launch of the original ‘Angry Birds’ game

HELSINKI: Rovio Entertainment, the maker of the “Angry Birds” mobile game, on Friday said the company needed to come up with new games to drive growth and warned that sales would fall this year after reporting higher third-quarter profits.
The Finnish company, which listed its shares on the stock market in Helsinki last year, reported third-quarter adjusted operating profit of €10.4 million ($11.8 million), up from €4 million a year ago.
But Rovio said tough competition and high marketing costs would put pressure on its full-year outlook. The group said it expected 2018 sales to be between €280 million and €290 million, compared with a previous range of €260 million and €300 million. Last year, the company had revenues of €297 million.
“It is clear that we need new games in order to accelerate growth,” Rovio’s Chief Executive Kati Levoranta said in a statement, adding that the company planned to launch at least two new games next year and had another ten projects in the pipeline.
Rovio grew rapidly after the 2009 launch of the original “Angry Birds” game, in which players used slingshots to attack pigs who stole birds’ eggs. The company expanded into film with an Angry Birds movie in 2016, but more recently has been hit by its high dependency on the Angry Birds brand and tough competition.
After its initial public offering in September 2017, Rovio’s shares dropped 50 percent in February after the company said its sales could fall this year after 55 percent growth in 2017.
Rovio expects a movie sequel to boost business next year and the company has also stepped up investments in its spin-off company Hatch, which is building a Netflix-style streaming service for mobile games.
Full-year core operating profit margin is seen at 10-11 percent, up from a previous view of 9-11 percent.


WEEKLY ENERGY RECAP: Keeping things in balance

Updated 08 December 2019

WEEKLY ENERGY RECAP: Keeping things in balance

  • The over-compliance will result in cuts of 1.7 million bpd

Brent crude rose above $64 per barrel after OPEC+ producers unanimously agreed to deepen output cuts by 503,000 barrels per day (bpd) to a total 1.7 million bpd till the end of the first quarter of 2020.

The breakdown is that OPEC producers are due to cut 372,000 bpd and non-OPEC producers to cut 131,000 bpd.

Current market dynamics led to this decision as oil price-positive news outweighed more bearish developments in the US-China trade narrative that has weighed on oil prices throughout the year, with US crude exports rising to a record 3.4 million bpd in October versus 3.1 million bpd in September.

OPEC November crude oil output levels at 29.8 million bpd show that producers were already overcomplying with its current 1.2 million bpd output cuts deal by around 400,000 bpd. 

The over-compliance will result in cuts of 1.7 million bpd, especially when Saudi Arabia continues to voluntarily cut more than its share.

This makes the agreed 1.7 million bpd output cuts pragmatic since it won’t taken any barrels out of the market.

It isn’t a matter of OPEC making room in the market for other additional supplies from non-OPEC sources, as OPEC barrels can’t be easily replaced.

Instead, this is about avoiding any oversupply that might damage the global supply-demand balance.

Saudi energy minister Prince Abdulaziz bin Salman has effectively kept his promise and managed to smoothly forge a consensus among OPEC and non-OPEC producers.

He has also successfully managed the 24-country coalition of OPEC+ including Russia in reaching an agreement.

Despite suggestions otherwise in recent coverage of the Vienna meeting, the deeper cuts announced on Friday have nothing to do with the Aramco IPO. Let’s remember this meeting was scheduled six months ago and the IPO has been in the works for much longer.

The Aramco share sale did not target a specific oil price. If that was a motivating factor it could easily have chosen another time.