Print 17 comment(s) - last by vol7ron.. on May 12 at 4:30 PM

Analysts have valued the company at $9 billion

Rovio Entertainment, the creator of the popular mobile game Angry Birds, is looking to go public in 2013 after a knockout 2011.

Rovio, which was founded in 2003, is looking at an initial public offering (IPO) next year in either New York or Hong Kong. Analysts have valued the company at $9 billion.

The Finnish video game developer launched Angry Birds in 2009, and has seen massive success ever since. The game has seen over 800 million downloads, and had 200 million active users monthly by the end of 2011.

Back in March, Rovio unleashed its latest Angry Birds release alongside NASA engineers called Angry Birds Space. In the first 35 days of launch, Angry Birds Space hit 50 million downloads, making it the fastest growing mobile game ever. The game allows PC, Mac, iOS and Android users to launch various types of birds at the green pigs using a whole new set of moves based on a zero-gravity environment. It offers 60 levels with six new characters and powers.

But Rovio's success doesn't end at the Angry Birds games. Last year, Rovio said one million plush toys and one million Angry Birds T-shirts were being sold on a monthly basis. In addition, the game was locked into a film deal with 20th Century Fox, where Rovio was able to release an Angry Birds "Rio" version based on the 2011 children's movie.

In 2011, Rovio's profit before tax was at $48 million on sales of $99 million. This was a huge boost from 2010's revenues of about $10 million. Rovio also raised $42 million from venture capital firms last year.

According to the Angry Birds maker, 2012 is expected to look just as good. Rovio plans to release many more Angry Birds and non-Angry Birds-related titles, and is aided by an increased cell phone sales outlook. The company has also placed large investments in branding, brand protection and product development.

"2012 looks fantastic," said Mikael Hed, Rovio CEO. "We have had some very strong download numbers over four months."

Rovio hasn't mentioned any other specifics regarding the upcoming IPO, but Rovio head of Investor Relations Anders Lindeberg said the company is preparing itself for a 2013 IPO.

Source: Reuters

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They Should Sell Now and Profit
By LTGJAMAICA on 5/7/12, Rating: 0
RE: They Should Sell Now and Profit
By NellyFromMA on 5/7/2012 12:09:51 PM , Rating: 2
LOL! Mobile Apps are easy to develop? I'm gonna take a big guess and say you've never actually developed one yourself?

In no imaginable way is developing a mobile app easy, especially compared to development for PC / Server.

Unless I missed something serious during my research for work.

Both Objective C (iOS) and the whole Java / Eclipse environment for the ADK (Android) are awful to use compared to modern development environments.

The tools are good when you consider how early they are in their life cycles on their respective platforms, but comparatively they are nightmares.

RE: They Should Sell Now and Profit
By Reclaimer77 on 5/7/2012 12:35:33 PM , Rating: 3
He's using a common, yet flawed, layman's premise: If a game/app looks simply and basic, it MUST be simple and basic to code.

heh, if only...

RE: They Should Sell Now and Profit
By WalksTheWalk on 5/8/2012 12:12:30 PM , Rating: 3
Regardless of the difficulty, you're right that they should sell now if they want to hedge their risk of devaluing the company between now and the IPO.

Between Rovio, Instagram, Twitter, etc. there is another technology bubble building. Years 2011-2013, meet years 1995-2000.

RE: They Should Sell Now and Profit
By vol7ron on 5/12/2012 4:30:57 PM , Rating: 2
I must be one of the few that found Angry Birds entertaining for 5 mins and got tired of it.

There's a whole chain of those type of games now, so yes it would be nice to sell now - just so I don't have to hear about it anymore.

By martin5000 on 5/8/2012 10:39:04 AM , Rating: 2
I agree that developing for Android is crap, but I think he means that mobile apps are generally a lot less complex and have fewer features, therefore are easier to make, and from experience I would say that is true.

RE: They Should Sell Now and Profit
By nafhan on 5/7/2012 1:04:14 PM , Rating: 3
Easy to develop?
Well, simple to play and simple visuals does not equal simple to develop (to be fair it doesn't mean hard to develop, either). The games that sell really well are usually doing something original and/or doing something well for the first time on a mobile platform.

Easy to profit from?
Nope. Most mobile developers don't make any money at all (by that I mean: profits < costs).

Also, Rovio has already gone beyond the mobile market. You can play Angry birds on the desktop and it's been included in Roku set top boxes (other things, too, I think). I would recommend reading up on Rovio, they're kind of an interesting company that's been around for a while, profitably, they just didn't hit it BIG until Angry Birds. None of this necessarily means I would invest in them, though...

By retrospooty on 5/7/2012 6:55:27 PM , Rating: 3
I think he means in comparison... Take some AAA console/PC title like COD3 or Battlefield3. these games have teams of literally 100's of programmers working for well over a year to get it all together. Mobile apps and games may not be "simple" but they are no-where near as complex or labor intensive as thier AAA PC/Console counterparts.

Smart Plan
By Flunk on 5/7/2012 12:03:30 PM , Rating: 2
If I owned Rovio I would sell out, start a new company and hire out anyone I felt was worth it. That valuation is really high.

RE: Smart Plan
By MZperX on 5/7/2012 12:33:24 PM , Rating: 3
No kidding, granted they have a very respectable profit margin (although not uncharacteristic for a software company) and have a recent 10x YOY revenue increase to boast about, the 90x multiplier still makes me scratch my head. Even if one assumes a 10 year window for that valuation, the company would have to deliver consistent average growth of about 38-39% YOY for the next ten years. And they'd still have "only" generated about $4.3 billion in profit by then (assuming the same margin). I'm sure people much smarter than me come up with these valuations...

RE: Smart Plan
By aharris02 on 5/7/2012 5:05:10 PM , Rating: 2
Agreed. But 1) Perhaps he has bigger aspirations? 2) You, as the owner, can't sell if the firm wants to go public.

Only time will tell what they have in store for #1. I can't imagine Angry Birds 3 taking off on enough platforms to justify an IPO.

RE: Smart Plan
By aurareturn on 5/11/2012 2:03:08 PM , Rating: 2
$9 billion!? They rely on one product. The bubble is officially here.

retarded multiple
By Mizerable on 5/7/2012 12:32:40 PM , Rating: 3
I'm gonna guess that 48 million figure is for EBIT, which would mean a 188x EBIT multiple, which is extremely retarded.
Industrial companies usually are under 10x, and "growth" companies like tech are usually less tha 60x, 200x is very stupid

anyways, these financial "analysts" are really a stupid bunch, they come up with stupid numbers by using comparable transactions recently, like zynga,

so unfortunately this retarded cycle is self-sustaining until the bubble bursts and these retards all lose their jobs

RE: retarded multiple
By TSS on 5/7/2012 12:52:09 PM , Rating: 2
Welcome to the decade of hype. Where hype is the denominator of value, rather then quality or longevity, earnings, revenue etc. It's all about the marketing now.

It's not so bad. After all it is still supply and demand, even though it's questionable what people demand. The only thing you shouldn't do is actually invest in these companies. Because hype is a fickle thing. And the next angry birds or farmville *will* come.

For actual companies it will be hell. If they manage to capture hype, it will inflate the company beyond what it's worth. When the hype moves to another company, that first company will deflate to below it's worth and they will lose a lot of money, possibly even go bankrupt. For the CEO's of said companies... well... This is insider trading heaven. Sell your stock after the IPO then buy it back at a fraction of the cost, or start a new company and do the same thing.

For ye ol' investor... eh... it's best to not be an investor in this decade. Get out and wait for the 2018-2020 buyers market. Or go into agriculture, that'll be hot next decade.

RE: retarded multiple
By Aloonatic on 5/10/2012 3:02:27 AM , Rating: 2
Hype's nothing new.

Do you not remember the .com hyped up bubble?

The only thing not stupid about "Angry Birds"
By bupkus on 5/7/2012 12:41:04 PM , Rating: 2
is the physics engine behind the game. It plays as if there are no predetermined results leaving a huge number of possible states the falling structures can result.

By martin5000 on 5/8/2012 10:41:07 AM , Rating: 2
Which is really not that complex in a 2D game.

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