Supercell's Revenue Tripled and Earnings Doubled | Financial Buzz

Supercell’s Revenue Tripled and Earnings Doubled

Supercell, a mobile game development company, recently announced their financial report for the year 2014. They reported $1.7 billion in sales compared to $570 million in 2013. Earnings before costs were doubled from $267 million in 2013 to $565 in 2014. Their first game, “Hay Day”, was released on 2012 and their second game, “Clash of Clans”, was released shortly, 2 months after. Their recent global launch of their third game, “Boom Beach”, in 2014 also came out to be a hit. Supercell’s games are free to download on Apple (NASDAQ: AAPL) and Google’s (NASDAQ: GOOG) app stores. The company’s sales come from selling virtual goods that enhance the games performance. According to Apple’s highest grossing games, “Clash of Clans” was ranked #1 on the chart with “Candy Crush Saga” behind at #2 in 2014. “Boom Beach” was ranked #5 while only being released a year ago.

Supercell has very high standards toward their game development, and expects all their products to maintain a top ten spot. Four games were called off, despite being nearly finished. Earlier in the year, “Spooky Pop”, was discontinued for unknown reasons and disappeared from the Canadian App Store, where it was being tested. Aside from releasing new games, the company updates their current games respectively. There have been about 24 to 30 updates towards Clash of Clans and Hay Day since their release in 2014. Tommi Suvinen, Clash of Clan’s game lead, says, “We don’t launch a game globally until everyone is confident that it can deliver the quality that players expect from Supercell.”

Supercell’s primary focus is to develop games for people to play for a very long time, rather than a short term quick-hit game. They attempt this by adding social features to their games, allowing players to chat and send messages to each other. They also update their game based on feedback from players, to balance gameplay while creating new challenges. New contents are rewarded to long term players while the core gameplay is always regularly improved to attract new players. Marketing and advertising plays a large role in mobile gaming. Supercell paid millions of dollars to advertise “Clash of Clan” characters on a video screen in South Korea, and also partnered with a popular local TV show in China.

In October 2013, Softbank Corp. bought 51.1% shareholding in the company for $1.5 billion. Softbank will receive $170 million in dividends from Supercell’s 2014 earnings.