It’s a decent point, and the company appears confident in its ability to continue spinning this particular wheel. What the above means is that King uses its already popular titles to seed and grow other titles, accelerating their uptake in the market, and keeping the company’s mix of gaming titles fresh and its users happy - at least in theory.
As of December 31, 2013, we had a massive network of 324 million monthly unique users and a track record of long-term retention driven by game longevity and our proven ability to cross-promote new games to our audience. We run thousands of discrete campaigns every 24 hours, each with individual target metrics, and all subject to the same target return parameters. We seed these channels by leveraging our significant capabilities in paid player acquisition. We obtain the vast majority of our installs organically or through viral channels that are driven by the effectiveness of our social features. We believe the inherently social nature of our games, our data-driven marketing processes, our cross-platform technology infrastructure and massive player network are key competitive advantages. The company addresses this in its S-1 (bolding: TechCrunch): Growing a second game to its heights is something that I’m not sure that more than a very small handful of companies have pulled off. King as a company has worked hard to ensure that it is not as top-heavy as it might be, a task that has proven incredibly difficult due to the sheer popularity of its signature title, Candy Crush. That uncertainty can make valuing application companies more tricky than other types of businesses. However, I think that the company exhibits both the good and the troubling of the hits-driven mobile game world, or even the mobile app world, in which boom and bust cycles can lead to huge short-term revenue generation but uncertain long-term value. And post-tax IFRS profits of $567.5 million in its most recent year? It’s almost unsurprising that the company has a “greenshoe” option to potentially sell even more shares in its public offering. During those three years, its monthly active user tally rose from 30 million in the first quarter of 2012 (that’s as far back as provided data goes), to 408 million in the last quarter of 2013.Īt its IPO filing, King has three games among the top 10 grossing games, and nearly 75 percent of its total revenue comes from the mobile channel.īig growth? Check.
The company’s numbers paint a picture of extreme growth and extreme profitability: Its revenue expanded from $63.9 million in 2011, to $164.4 million in 2012, to $1.88 billion in 2013. An updated F-1 filing indicates that it wants to raise up to $532.8 million at a valuation of $7.6 billion. The company behind the wildly popular mobile game Candy Crush, King Digital Entertainment, is going public.
Instead, it’s a meditation on the dynamics of the mobile gaming market in the context of an IPO which grants us raw data into a company in the space.
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