10 Keys to Candy Crush’s $500 Million IPO

King's success rides on hit game

Candy Crush Saga is headed to Wall Street with a public offering that could value the company at up to $10 billion, according to the filings. The company behind the game, King Digital Entertainment, announced its intentions to sell its stock, and released financial data that show its value skyrocketed last year during the Candy Crush rush. Here’s how:

  1. In January 2013, King’s private stock (for employees and initial shareholders) was valued at about $10 a share, according to the filings released this week. In January of this year, options were granted with an exercise price of $78.43.
  2. At $78.43, King would be worth $9.4 billion, according to the number of outstanding shares (120 million) the company said it would have after its initial public offering.
  3. King said it would raise at least $500 million when it sells shares, which will likely be in the second quarter.
  4. King’s success is thanks to Candy Crush, which helped grow revenue from $164.4 million in 2012 to $1.88 billion last year. Profits went from $7.8 million in 2012 to $567.6 million last year.
  5. Candy Crush attracts a daily audience of 93 million players. Its next most popular game, Pet Rescue Saga, attracts an audience of 15 million daily users.
  6. King gets most of its money from mobile platforms, and mobile revenue rose from less than $20 million in 2012 to $1.3 billion last year.
  7. Its mobile revenue accounted for 72 percent of all revenue last year.
  8. The concerns with King, as with any gaming company, is its reliance on just a few hits for its success. Candy Crush was responsible for nearly 80 percent of its revenue last year.
  9. Also, the company showed signs of slowing growth already. Fourth quarter revenue was lower than the third quarter—$602 million, down from $620 million.
  10. King also has dropped its advertising business last year—no in-app inventory for sale on Candy Crush. Only 1 percent of revenue was from selling ads last year.