Rovio, maker of the Angry Birds gaming franchise, saw a small pop of 6 percent in its first day of trading as a public company before later tumbling down below it. After pricing its IPO at €11.50 per sharetrading as ROVIO) is now at €11.68/share, giving it a market cap of $1 billion (€910 million).
We’re now watching to see how close the shares get to its initial offering price of €11.50, which was oversubscribed, in the words of Rovio. It will be interesting to see how and if the numbers change as London and then the East Coast of the U.S. wake up. Rovio’s 37,073,010 IPO shares were offered to private individuals and entities in Finland, Sweden and Denmark and in private placements to institutional investors in Finland and internationally
Rovio itself counts the U.S. market as one of its very biggest — the company said that “most” of its revenue comes from North America and Europe — and it also has a high profile there. But unlike Spotify, another company based out of the north of Europe that counts the U.S. as a key area for current business and future growth, Rovio chose to list closer to home.
Rovio once had designs to become the next Disney. But the fortunes of gaming companies rise and fall with the popularity of their titles, and that has impacted that lofty goal. (Indeed, you could argue that this has been a sticking point for some other gaming companies that have gone public in recent years, such as King — which eventually sold to Activision Blizzard — and Zynga. Their economics do not necessarily follow those expected of public companies.)
Rovio has had a number of strong follow ups to the original Angry Birds — it had three mobile in Apple’s top 100 highest grossing apps over the summer, for Angry Birds Blast, Angry Birds Evolution and Angry Birds 2 — but no new brand so far has quite broken through as a blockbuster in quite the way as the original Angry Birds did.
Subsequently, Rovio has since pulled back many of its most ambitious projects outside of games (such as amusement parks) in favor of a licensing model, where a third party takes on the investment and risk of new projects outside of games.
Other moves in the future for the company will include more geographic expansion. With China currently the world’s biggest market for gaming, Rovio is focusing its strategy there.
“We are working on a number of high profile potential partnerships in China,” Rovio’s EVP of games, Wilhelm Taht, said in an interview with TechCrunch last month. In China, foreign companies need to align with a local company in order to build a business in the country. “We have gone through several potential partnerships and with 600 million downloads in the region already, we will try to strengthen the China business.”
The company reported revenues of €266 million ($314 million) for the year that ended June 30, 2017, with an operating profit of €29,483 ($35 million).
We are updating this story with more detail and price changes throughout the day.