By Dominic Chopping
Rovio Entertainment Oyj reported higher-than-expected first-quarter net profit on Friday and backed expectations of strong revenue growth this year.
The company behind the Angry Birds mobile game franchise reported net profit of 5.5 million euros ($5.8 million) for the quarter, compared to 7.4 million euros a year earlier. early, as revenues increased by 27% to EUR 85.0 million.
A forecast by FactSet analysts was for a net profit of 3.1 million euros on revenues of 79.1 million euros.
Building on the positive momentum from its top live games, the launch of Angry Birds Journey in January 2022 and fully benefiting from the acquisition of Ruby Games since the start of the year, Rovio said it is still expects strong revenue growth for the year.
However, depending on the speed of growth and investments, adjusted operating income should be lower year-on-year.
Investments in user acquisition during the quarter – the cost of advertising and marketing to attract players – increased by 80% to 31.1 million euros during the quarter, while the total gross bookings increased by 26% to reach 80.8 million euros. Gross bookings represent in-app purchases and in-app ad sales.
The Finnish developer said user acquisition investments in the second quarter are expected to account for around 25-30% of game revenue.
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