Did you miss a session from GamesBeat Summit 2022? All sessions are available to stream now. Watch now.
Supercell is going to need a bigger bank account.
The privately held Finnish developer revealed the results of its fiscal 2014 today, and the company saw mammoth growth in its revenues and earnings. Hits like Clash of Clans, Hay Day, and Boom Beach helped the company generate revenue of $1.7 billion (€1.55 billion) last year. That’s up from what was effectively $570 million (€515 million) in 2013 (although the Euro was worth more in 2013, so that €515 million was worth closer to $850 million at the time). In terms of earnings, the company pocketed $565 million. That’s up big from $267 million in 2013.
Supercell is one of the industry leaders on mobile, a potentially $30 billion industry this year, predicts research firm Newzoo. Clash of Clans has topped the highest-grossing list on iOS and Android nearly every day since 2012. And the company has figured out novel ways to bring in new players while squeezing more money out of everyone who boots up the free-to-play game.
The studio was so successful that it actually ran a minute-long ad during the Super Bowl for Clash of Clans to attract new players. That commercial likely cost the company around $9 million just for the airtime, and it starred international movie star Liam Neeson.
While Clash of Clans was the top-grossing game for 2014, Supercell’s other two hits, Boom Beach and Hay Day, were big successes as well. Each finished in the top 20 in terms of overall app revenue.
These three games are the only active apps that Supercell has. The company has shut down several others, and it has even closed down projects that it was testing for release worldwide.
Supercell tries to keep its focus only on releases that it thinks can reach an extremely high level of success. While revenue is a concern, the developer also worries about the huge efforts it puts into upgrading and maintaining its active games.
The studio plans about 10 to 15 content patches a year for its games, and that it considers that a wasted effort if the game isn’t making millions of dollars every week. It also only has around 150 employees, and it doesn’t want to spread that talent to thin.
“The element of Supercell’s business that most impresses? The fact that in the last year they added only a dozen employees to their staff, taking the total to 150,” VB Insight analyst Stewart Rogers said. “Compare that to King, which recently reported 1.45-times the revenue of Supercell at $2.26 billion with a staff of 1,200, and it underlines how effective Supercell is right now.”
Of course, not releasing new games to replace older apps is one thing that has investors concerned about Supercell rival King. A report that came out earlier this year (via NPR’s Planet Money) reported that King is one of the most shorted stocks on the market. That means investors believe its price will go down. The reason? Because King is still so reliant on one game: Candy Crush Saga.
While Supercell is making a ton of money, it will likely need to show that it can replace the megasuccessful Clash of Clans with something equally lucrative.
GamesBeat's creed when covering the game industry is "where passion meets business." What does this mean? We want to tell you how the news matters to you -- not just as a decision-maker at a game studio, but also as a fan of games. Whether you read our articles, listen to our podcasts, or watch our videos, GamesBeat will help you learn about the industry and enjoy engaging with it. Learn more about membership.