May 7, 2012
Angry Birds Maker Could Have $9 Billion Valuation
It´s the gaming phenomenon that´s leaving its mark on our generation. Its newest iteration has been download over 10 million times and it´s soon to be featured on television screens and playgrounds the world over.
It´s the Angry Birds, and they aren´t showing any sign of slowing down.
According to Reuters, Angry Birds creators Rovio Entertainment have announced sales of their popular video game have jumped “tenfold” to $100 million last year. This is enough to make for a strong stock market listing, says Rovio.
In fact, the Finnish bird-makers have been valued by analysts at $9 billion. Put in perspective, such a valuation places just shy of their neighbors, Nokia.
Rovio was initially founded in 2003, but didn´t see this kind of growth until they released the now iconic Angry Birds for Apple´s iPhone in 2009. Since then, the game has remained at the top of sales charts everywhere, selling more than 800 million copies of their games. At the end of 2011, Rovio said they had 200 million users every month. According to Reuters, that´s just shy of Zynga´s 240 million.
Tero Kuittinen from Finnish mobile firm Alekstra is impressed with Rovio´s performance.
“Rovio has fended off all rivals so far,” she told Reuters.
“Rovio is still the king of the mountain, despite stiff recent challenges by OMGPOP and Disney´s ℠Where´s My Water?´”
Rovio has said before they plan to branch out not only beyond video games, but also beyond the Angry Birds franchise. According to Chief Executive Mikael Hed, Rovio will release several such titles in the coming months.
Stronger cell phone sales, product development and branding will also help push Rovio into higher profits, says Hed.
“2012 looks fantastic,” Hed said. “We have had some very strong download numbers over four months.”
Consumer products, such as merchandising and licensing generated around 30% of Rovio´s profits last year,
With all this growth, Rovio looks poised for an initial public offering, though not until next year. When they do go public, however, the company has their eyes on either Hong Kong or New York.
“This company is preparing itself and getting ready,” said Anders Lindeberg, Rovio´s head of investor relations, saying the company is already working on meeting all of the governance requirements.
Not everyone agrees with such a large valuation, however. Writing for Forbes today, Tim Worstall admits to being the “odd one out there” and says he doesn´t see why the company should be listed so highly.
“But it is still just a game,” Worstall writes.
“One with no network effects, nothing to tie people to the platform and no real method of excluding the competition. It really is just a well executed and fun game. Something which I submit is not in fact worthy of a $9 billion valuation.”
Before taxes, Rovio reported a $48 million profit on sales of $99 million in 2011. The company did not list historic data, but has said its revenues were around $10 million in 2010.