Angry Birds creator’s profits drop by more than half

As Rovio plans for the future, the company’s profits took a hit for the 2013 calendar year. The Angry Bird house’s net profits were slashed in half to €26.9 million, but important to note here is that the company’s sales remained stable at €156 million. Rovio’s CFO explained the profit reduction as part of the company’s “foundation-building year,” as it invested in new business areas like animation, video distribution, spinoffs, more spinoffs, and other things outside of selling Angry Bird games at $1 a pop.

Rovio, the maker of Angry Birds, hit headwinds in 2013 as revenue flattened and profit tumbled amid attempts to adapt to changing industry trends and diversify a business dependent on hit games. Finland-based Rovio Entertainment Ltd. skyrocketed to global prominence early this decade on the popularity of its “Angry Birds” mobile app. Chief Executive Mikael Hed quickly moved to broaden the company by expanding into licensing and other entertainment products. Other games makers, including Rovio’s Nordic rivals, have caught up by offering titles that can be downloaded free and then improved via in-game purchases—the so-called “freemium” model which now sets the standard.