King, the firm behind everyone’s favourite mercilessly addictive mobile game Candy Crush Saga (sorry Farmville), has announced a 28% fall in profits to $119m (£76.2m) for the quarter to June 30.
Well, ‘announced’ might be a bit strong. One of the problems with quarterly reporting is that it encourages sometimes unseemly levels of spin. Faced with its key metrics falling or remaining virtually stagnant - revenue was down 17.5% to $490m, gross bookings or 'virtual sales' for its games were down 13.4% to $529m, while monthly active users rose a paltry 3.3% to 501 million - King focused relentlessly on the positive.
‘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,’ King CEO Riccardo Zacconi said.
In many ways that’s part of the problem. King’s flagship is still Candy Crush Saga, which debuted three years ago. It has yet to follow it up with the Next Big Thing, which is the key factor limiting its growth.
King won't be panicking quite yet - the business is still making a tidy profit, after all. Having an adjusted EBITDA over 40% (for the eighth consecutive quarter, don’t you know) is something most tech companies would die for.
Unlike their table-based cousins, though, electronic games do have a shelf life. Bookings for Candy Crush Saga fell 43% from last year to $205m. King needs the next Candy Crush, and if it doesn't come up with it, someone else will.