BENGALURU: King Digital Entertainment plc (King) reported revenue was US$ 490 million for the quarter ended June 30, 2015 (Q2-2015, current quarter), representing a sequential decrease of US$ 80 million, or 14 percent, and a year over year decrease of US$ 104 million, or 18percent. The company says that the decreases in both gross bookings and revenue from Q1- 2015 to Q2-2015 were primarily driven by its largest franchise, Candy Crush, as it continues to mature. King says that the sequential decrease in revenue also reflects a higher change in deferred revenue resulting from an increase in the length of time its players retain virtual currency in its more mature games.
The company says that the decreases in both gross bookings and revenue from Q2- 2014 to Q1-2015 were primarily due to lower gross bookings from Candy Crush Saga and its other more mature games, partially offset by increased gross bookings from newer games, in particular Candy Crush Soda Saga. In the first half of 2015, as compared to the same period in the prior year, we launched fewer franchise games, which tend to offset declines in our more mature games. The decrease in revenue also reflects a higher change in deferred revenue primarily due to the increased use of virtual currency in our mobile games as well as higher sales tax related to the new value added tax legislation in the European Union effective in 2015.
Gross bookings from games other than Candy Crush Saga2 were $324 million for Q2- 2015, representing a sequential decrease of US$ 51 million, or 14 percent, and a year over year increase of US$ 74 million, or 30 percent.
King CEO Riccardo Zacconi said, “Our second quarter 2015 gross bookings exceeded the high end of our guidance range and for the third consecutive quarter, Candy Crush Saga, Candy Crush Soda Saga and Farm Heroes Saga ranked within the top 10 grossing games in the Apple App Store and Google Play Store in the U.S. These results reflect our execution on delivering new content and features in our franchise games and demonstrate the continued benefits from operating global mobile game franchises and the strength of their brands. We are also pleased to have recently launched Paradise Bay, our first resource management game, and Scrubby Dubby Saga, our first game with a slider mechanic, and look forward to introducing these fresh games to our massive player base and to players around the globe.”
King’s Profit was US$ 119 million for Q2- 2015, decreasing by US$ 45 million, or 27 percent, compared to Q1-2015. The decrease was primarily due to lower adjusted EBITDA and higher change in deferred revenue and foreign exchange losses, which were partially offset by lower income tax, acquisition-related and share-based and other equity-related compensation expenses.
Q2-2015 profit decreased by US$ 46 million, or 28 percent, compared to Q2-2014. The decrease was primarily due to lower adjusted EBITDA and higher change in deferred revenue and foreign exchange losses, which were partially offset by lower income tax and share-based and other equity-related compensation expenses.
MAUs (monthly average users) were 501 million in Q2-2015, down 49 million, or 9percent, from Q1-2015, and up 16 million, or 3 percent, from Q2-2014.
DAUs (daily average users) were 142 million in Q2-2015, down 16 million, or 10percent , from Q1-2015, and up 4 million, or 3 percent, from Q2-2014. The company says that the sequential decreases in MAUs and DAUs were due to a decrease in game activity, primarily in Candy Crush Saga, as well as in most of King’s other games. The decrease was reflected on both mobile and web with web declining at a faster rate, which we believe is due to a continuing decline in overall Facebook desktop users.
King says that YoY increases in MAUs and DAUs primarily were the result from introduction of new games, particularly Candy Crush Soda Saga, partially offset by a decline in Candy Crush Saga and other more mature games. The YoY increases also reflect growth in activity from mobile players, partially offset by the continued decrease in activity from its Facebook players.
MUUs (monthly unique users) were 340 million in Q2-2015, down 24 million, or 7 percent, from Q1-2015, and down 5 million, or 1 percent, from Q2-2014. The sequential decrease in MUUs was reflected in both web and mobile, but at a greater rate of decline on web, which the company believes is due to a continuing decline in overall Facebook desktop users.
Monthly Gross Average Bookings per Paying User (MGABPPU) decreased to $23.26 in Q2-2015, down US$ 0.38, or 2 percent, from Q1-2015, and up US$ 3.72, or 19 percent, from Q2= 2014. The relatively flat sequential MGABPPU reflects that a consistent proportion of payers are paying in more than one game, as we have observed that payers who spend in more than one game tend to spend higher amounts than those who pay in only one game.
The year over year increase in MGABPPU is due to a higher portion of payers paying in more than one game, as well as King’s transition to virtual currency which enables players to transact at higher amounts.