Two Supercell games pull in $2m a day

Supercell, the Finnish software developer behind the highest-grossing games app in the US, has revealed that it had made nearly $900m in revenues last year, despite having just 132 staff – making it one of the most successful mobile gaming companies in the world.

In its first formal annual results presentation, the Helsinki company said that its revenues had grown from $101m in 2012 to $892m in 2013, while its earnings before interest, tax, depreciation and amortisation increased from $51m to $464m.

Its performance has been driven by the global success of its Clash of Clans and Hay Day games – respectively, the number one and number four mobile gaming apps in the US in revenue terms, according to data provider AppAnnie. Last year, the one-time leading player of Clash of Clans told The New York Times he was taking five iPads into the shower to play the game.

Clash of Clans and Hay Day were both released in the summer of 2012 on Apple devices, before being launched last year on Google’s Android operating system. By the end of last year, the two titles were generating more than $2m a day, as regular players paid more money to speed up the game or buy extra powers.

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By contrast, the much hyped Flappy Bird game – which was taken down from app stores at the weekend despite topping the download charts – was reportedly making its Vietnamese developer about $50,000 a day.

Illka Paananen, Supercell’s chief executive and one of its six co-founders, said: “You need to create a game that people play for years, not months and those people have to play a lot.” He said that many people played its games 9-10 times a day but often just for five to seven-minute periods.

But on Wednesday, in response to suggestions that some players were addicted to Supercell’s games, Mr Paananen said: “You could say that about every type of entertainment. I agree with you: I don’t think you should devote your life to playing games. What is different about mobile games [to console games] is that in some part they have become part of people’s daily life. You carry the game with you.”

Supercell’s growth appears to have accelerated after an advertising campaign that included a slot during the Super Bowl in the US. A hacker this week disclosed figures that Supercell’s revenues per day were now $5.15m.

Mr Paananen declined to confirm or deny the figures, merely saying the hacking was a “criminal act”.

We are really amazed at how fast our business has scaled over the past year. None of us could have imagined anything like this

On Wednesday, Supercell said it would release its third game – Boom Beach – first on Apple’s iOS and then on Android. Mr Paananen said there were no plans to release its games for Microsoft’s Windows Phone platform.

Last year, Supercell sold 51 per cent of its business to GungHo Online Entertainment of Japan, a unit of telecoms group SoftBank, in a deal that valued the Finnish group at $3bn and eased the pressure for an initial public offering in the short term.

GungHo is one of the few mobile gaming companies that is more successful than Supercell, achieving revenues of $1.6bn last year and operating profits of $900m, helped by its Puzzle & Dragons game.

“We are really amazed at how fast our business has scaled over the past year,” Mr Paananen said. “None of us could have imagined anything like this when we founded the company three-and-a-half years ago.”

Five highest-grossing games in the US*

1. Clash of Clans
Publisher: Supercell
Launched: 2012
Role in the gaming universe: A leading example of freemium games, where playing is free but real money is charged for in-app purchases such as additional lives.
Synopsis: Players must build and defend their village, which may seem a familiar challenge for those affected by the English floods. Revenues are reported to exceed $3m a day.

2. Candy Crush Saga
Publisher: King
History: It started life on Facebook but has become successful enough for developer King to consider a multibillion-dollar IPO.
Synopsis: Fairly similar to Bejeweled, Candy Crush involves forming rows of three jellied sweets. With over 500 levels, it can keep commuters busy for hours – providing they can tolerate the soundtrack.

3. Game of War – Fire Age
Publisher: Machine Zone
International appeal: The emphasis in this battle game is on global interaction – players from different countries can communicate using an automatic translation engine, which covers 32 languages.
Synopsis: Discerning reviewers think the game itself resembles what has come before, including Kingdoms of Camelot.

4. Hay Day
Publisher: Supercell
Synopsis: Supercell scored its first hit with the seemingly bland idea of getting players to “buy and sell fresh produce”.
Revenue streams: In-app purchases are the money-spinners. “A lovely game which would be worthy of five stars if it wasn’t for the ease with which you can accidentally purchase items,” said one reviewer in Apple’s App Store – which the company would probably take as a compliment.

5. Farm Heroes Saga
Publisher: King
Synopsis: Like Candy Crush, it is about matching three similar objects (here fruits, vegetables and farm animals).
Revenue streams: “This is probably King’s best game on iOS since Candy Crush, though it still falls well short of it,” wrote one reviewer about Farm Heroes Saga. It is free with a twist – at one point, users must either pay to continue or connect with friends on Facebook.

And one that’s a hit in Japan…

Puzzles and Dragons
Publisher: Gung Ho
Popularity: Not at the top of the US charts, Puzzles and Dragons has been downloaded over 20m times in its home market of Japan and is by some accounts the world’s highest grossing game, with particular success on Android devices.
Synopsis: The game asks players to collect a team of monsters as they explore dungeons. “Highly addictive obsession for some, throwaway garbage for others,” said the site USGamer. But investors like it, pushing GungHo’s market capitalisation over $7bn.

* Source: AppAnnie, as of February 12, US only, iOS devices