A Review of Quarterly Earnings for Android, iOS Gaming Companies

Because it was so popular last time, we’re doing it again. Here’s a little cheat sheet for industry observers summarizing smartphone earnings and growth for the quarter ending in September. We also put in privately-held freemium gaming companies for which you can estimate earnings based otinn top-grossing titles.

Quarter-over-quarter growth seemed to slow in the period from June to September with companies like Glu Mobile barely topping smartphone sales from the previous quarter while EA’s mobile revenue declined (likely because of its feature phone business. They don’t break out smartphone performance.)

However, Japan’s Capcom sets a nice benchmark, forecasting $77 million in annual revenue from its social and mobile gaming unit for the year ending in March 2012. South Korea’s Gamevil also posted quarter-over-quarter smartphone revenue growth of nearly 27 percent and will probably go into a strong holiday quarter, especially with Apple finally adding a games category to the country’s app store.

Given how publicly-traded companies are performing with both freemium and paid app monetization on a quarterly basis, we’re still looking at a few privately-held companies that will cross $50 million in annual revenue this year.

Publicly-Traded Gaming Companies

Glu Mobile:
Smartphone Revenue: $9.7 million, up more than fourfold from the same quarter a year ago when it earned $2.4 million in the third quarter. But growth has slowed down on a quarter-over-quarter basis with just a 2.4 percent increase over last quarter’s $9.4 million in smartphone revenue.
Market Capitalization: $205.3 million
Hits: Contract Killer: Zombies, Gun Bros. The two franchises have brought in $1.8 million and $1.5 million respectively in the quarter.
Number of Titles Consistently in Top Grossing 50: Varies widely, depending on launches. Zero to two on iOS. The company continues to have about four or so in Android’s top-grossing 50.

Revenue (Smartphone & Social Networking Sites): We calculated that Capcom’s mobile and social gaming unit pulled in $17.6 million in the quarter ending in September. (It said it earned $33.1 million in the last six months and then in a previous statement, it said the unit made $15.5 million in the first quarter of that half.) It’s not clear how much of that came from the Facebook version versus the iOS version of the Smurf’s Village game plus other iOS titles.
Market Capitalization: $1.82 billion
Hits: Smurf’s Village, Monster Pet Shop
Number of Titles Consistently in Top Grossing 50: Usually at least one on iOS, sometimes two. Capcom just recently established Smurf’s Village on Android where it’s currently the 5th top grossing game in the U.S. with between 500,000 and 1 million installs.

Smartphone Revenue: $7.1 million this quarter, up 497 percent year-over-year. On a quarter-over-quarter basis, revenue is up 26.8 percent from the $5.6 million seen last quarter.
Market Capitalization: $378 million
Hits: Air Penguin, Zenonia, Baseball Superstars, Colosseum Heroes, Air Penguin
Number of Titles Consistently in Top Grossing 50: Varies. Sometimes one to two on iOS.

Electronic Arts:
Mobile Revenue: $55 million last quarter, up 12 percent year-over-year. On a quarter-over-quarter basis, mobile revenue is down $2 million. EA doesn’t break out smartphone revenue, so this counts a declining feature phone business.
Market Capitalization: $7.6 billion
Hits: Bejeweled Blitz, Plants vs. Zombies, Madden NFL 12, Tetris
Number of Titles Consistently in Top Grossing 50: Also varies widely. It’s currently four (with two titles from recently acquired PopCap Games), but sometimes it races closer to 10 when the company has sales.

Overall & Smartphone Revenues: Gameloft did 40.1 million euros ($55.9 million) in the third quarter. It said smartphone and tablet-related sales were 34 percent of total sales, or 13.8 million euros ($19 million). That’s up 60 percent year-over-year.
Market Capitalization: $421 million
Hits: Modern Combat 3, Order & Chaos Online
Number of Titles Consistently in Top Grossing 50: Varies widely from zero to three and possibly more, depending on when Gameloft has sales. Gameloft has one title in Android’s top 50 grossing currently.

The Japanese Mobile Gaming Platforms That Are Trying to Crack The West

Net Sales & Income: The Japanese company saw 34.7 billion yen ($449.4 million) in net sales, which is up 28 percent year-over-year but flat on the previous quarter. DeNA’s costs have gone up as the company tries to build out a robust international strategy by extending the Mobage platform to Western and Chinese markets. Net income was 8.19 billion yen ($106.1 million), up 7 percent year-over-year but down 13 percent over the previous quarter.
Market Capitalization: $5.29 billion

Net Sales & Income: GREE brought in 30.4 billion yen ($394.3 million) in net sales, which is up 145 percent year-over-year and 44 percent on the previous quarter. The company was able to grow paid services, or the monetization of first- and third-party games by nearly 50 percent quarter-over-quarter while advertising also grew. Its margins are higher than rival DeNA’s with net income at 9.449 billion yen ($122.4 million), up 156 percent year-over-year and 66 percent on the previous quarter.
Market Capitalization: $8.22 billion

Privately-Held Gaming Companies

Pocket Gems:
Hits: Tap Zoo, Tap Pet Hotel, Tap Petshop
Number of Titles in Top Grossing 50: Two to three, but Pocket Gems has slipped a little from last quarter when it would often control the top #1 and 2 slots. The company hasn’t been as successful on Android as other rivals.
Revenue: Undisclosed.
Funding: $5 million from Sequoia Capital, angels. An unknown amount of funding from Redpoint Ventures, which was said to be mainly founder liquidity.

Zynga* (soon to be publicly traded):
Hits: Words With Friends and Hanging With Friends via the Newtoy acquisition. Zynga Poker.
Number of Titles in Top Grossing 50: Usually around three on iOS. Zynga has launched some games on Android, but it has yet to build a strong presence there.
Revenue: Overall third quarter revenue was $306.8 million. The company does not break out mobile revenue, but it did say that it had 9.9 million daily active users on iOS and Android.
Funding: $845 million from Google, Digital Sky Technologies, Kleiner Perkins Caufield & Byers, Union Square Ventures and others.

Hits: World War, Fashion Story, iMobsters, Bakery Story, Restaurant Story, Vampires Live
Number of Titles in Top Grossing 50: Like Pocket Gems, Storm8 has slipped a little this quarter on Apple’s platform. It now has about one to two games on iOS’ top 50 grossing, but it’s found strength on Android where it currently has eight games there in the top 50.
Funding: No external funding to date. It seems that a rumored round that would peg the company’s valuation at $1 billion didn’t happen.

Rovio Mobile:
Hits: Angry Birds and all of the brands’ extensions.
Number of Titles in Top Grossing 50: Usually three and all of them are variations on Angry Birds.
Revenue: Undisclosed. It would be extremely hard to predict or benchmark off of publicly-traded mobile gaming companies because Rovio gets many special one-off deals with carriers and entertainment companies like Twentieth Century Fox. Rovio also derives more revenue from advertising compared to the rest of these companies. The company said within the last month that it has 30 million daily active users.
Funding: $42 million from Atomico Ventures and Accel Partners.

Game Insight:
Hits: Paradise Island, My Country.
Number of Titles in Top Grossing 50: Varies widely. Sometimes they have two on iOS and sometimes they have none. On Android, however, they control two of the highest-grossing games Paradise Island and My Country.
Revenue: Unknown, but the company did say it was making more than $1 million per month in net revenue from Paradise Island on Android in August. It also said it made $300,000 from its iPad app My Country after two weeks from launch. Sources who looked at the company’s financials as prospective investors or acquirers have told us the numbers Game Insight shares with us are legitimate.
Funding: This Russian company run by five women is bootstrapped.

Backflip Studios:
Hits: Dragonvale, Paper Toss
Number of Titles in Top Grossing 50: Backflip has had a strong resurgence this quarter with Dragonvale, a casual, animal care-taking game with beautiful art. They usually have one game in the top grossing 50, but they have decent launches from time to time that may put a second title up there.
Funding: They haven’t revealed any venture funding to date.

Hits: Crime City
Number of Titles in Top Grossing 50: Funzio was able to parlay success on Facebook onto the iOS platform with an extension of its Crime City brand. The app is currently ranked #12 and Funzio is trying to live out ambitions of being a genuine, cross-platform gaming company.
Funding: The company recently took $20 million in Series A funding from IDG Ventures and IDG Capital Partners.

Hits: Tiny Zoo Friends
Number of Titles in Top Grossing 50: Usually one, Tiny Zoo, which was beating the Pocket Gems’ Tap Zoo for quite awhile. The company’s more recent titles like Tiny Village and Tiny Pets haven’t fared as well. Tiny Pets usually ranks between #50 and #100 in the U.S. while Tiny Village hasn’t managed to stay on the overall grossing lists (although to be fair, it looks like the company soft-launched it and only started spending aggressively on marketing last week. The title’s now in the top #25 free in the U.S.)
Funding: $18 million from Andreessen Horowitz

Hits: Top Girl, which has also slipped a little recently and now ranks around #30.
Number of Titles in Top Grossing 50: One
Funding: $23 million from Intel Capital, Time Warner, The9 and other angels.

The Playforge:
Hits: Zombie Farm
Number of Titles in Top Grossing 50: Usually one. The company recently launched its second major title Zombie Farm, but it hasn’t stuck as strongly on the charts with a current ranking of #110.
Funding: They’re bootstrapped, and have no public interest in pursuing funding.

Red Robot Labs:
Hits: Life is Crime
Number of Titles in Top Grossing 50: One on Android and none on iOS from this company started by EA, Playdom and Crowdstar alums. Life is Crime has been making a steady climb up the charts and is sitting at #7.
Funding: $8.5 million from Benchmark Capital and Shasta Ventures, plus angel investments from Rick Thompson, co-founder of Playdom, and Chamath Palihapitiya, who was a vice president at Facebook.

Hits: My Town2
Number of Titles in Top Grossing 50: One. Booyah looks like it may have the beginnings of a comeback on iOS, but it’s too early to tell as their new game is only a few weeks old. City-builder My Town2 is a re-imagining of the company’s original hit and check-in app My Town. 
Funding: The company has at least $24.5 million in funding from Kleiner Perkins Caufield & Byers’ iFund and Accel Partners.

Hits: High Noon
Number of Titles in Top Grossing 50: One. Happylatte is a Beijing-based company that used to do technical outsourcing work. But as margins on that business declined, they switched to building games. They have a promising start with a game that’s now pulling in more than $1 million a month, but now need to prove they can be more than a one-hit wonder.
Funding: The company is bootstrapped.

Hits: Global War, Original Gangstaz
Number of Titles in Top Grossing 50: None at the moment, but occasionally they have 1 or 2 games that make it into the top 50.
Funding: Addmired has seed funding from incubator YCombinator.

Kama Games:
Hits: Texas Poker
Number of Titles in Top Grossing 50: Usually one, but they’ve been seeing more competition from Zynga Poker. Kama Games recently acquired the IP behind a number of games like Mall Party, so they’ve been trying to find other hits.
Funding: No outside venture funding. The company was founded by a supermarket magnate in Siberia.

Hits: TradeNations, MetalStorm: Online
Number of Titles in Top Grossing 50: Z2Live’s titles haven’t been as highly ranked this quarter. MetalStorm’s new version sits at #70 while TradeNations is at #77.
Funding: The company raised a round of undisclosed size from Draper Fisher Jurvetson and Madrona Venture Group.

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