tech news

5G platform wipes out profits at Angry Birds maker Rovio

HELSINKI: Quarterly revenue at Offended Birds maker Rovio Leisure plunged 96% because the cell video games firm was hit by the slower-than-expected take up of its 5G gaming platform Hatch and better advertising and marketing prices.

Shares within the Finnish firm slumped 22% in early Feb 12 buying and selling after it mentioned it was evaluating “strategic options” for Hatch, whereas additionally trying to make annual value financial savings of €6mil (RM27mil) for the 80%-owned unit.

It didn’t elaborate on what these options is likely to be, however mentioned it deliberate to shift the unit’s emphasis to Hatch Youngsters, a subscription and streaming service for youngsters and households.

Rovio, searching for methods to construct on the success of the 10-year-old Offended Birds collection of video games, mentioned competitors in video games streaming had intensified globally whereas the roll-out of 5G networks and gadgets had been slower than anticipated.

Final yr, the corporate opened up Hatch to outdoors funding, however on Feb 12 it closed the fundraising with out saying any new traders.

Fourth-quarter adjusted working revenue tumbled to €200,000 (RM903,400) from €5.3mil (RM23.94mil) a yr earlier, whereas gross sales dropped 1.4% to €71.6mil (RM323.4mil).

Video games income and gross bookings each hit new data, at €66.7mil (RM301.3mil) and €67mil (RM303mil), respectively.

However so-called consumer acquisition prices, equivalent to the price of getting video games displayed prominently in app-stores, jumped 18% to €27.5mil (RM124.2mil), or 41.3% of video games revenues for the quarter.

The corporate mentioned acquisition prices had been decrease to date this yr which, coupled with the deliberate value financial savings at Hatch, ought to result in an enchancment in adjusted working revenue in 2020. It didn’t give income steerage for this yr.

Rovio proposed a dividend of €0.09 (RM0.41) per share, just like final yr. – Reuters

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