The Candy Crush (IPO) Saga
Activision Blizzard gets sweet on Candy Crush.
King Digital Entertainment hopes to ride the success of its game Candy Crush Saga to stage a $500 million IPO.
On any given day more than 90 million people are playing Candy Crush Saga. The game starts out free but you can opt to pay for bonuses and that’s how King makes its money. Profits skyrocketed after the company released Candy Crush in 2012. But it’s future prospects are still uncertain, said Brian Blau is an analyst at Gartner.
“Candy Crush has been a huge success but I also worry that this is the only success King will have in the near term,” Blau said.
The company says Candy Crush is responsible for 78 percent of its revenue. And there are already signs that those numbers are slowing, said Trip Chowdhry is an analyst at Global Equities Research. He says investors are betting that Candy Crush stays a hit forever for just long enough for King to come up with another hit.
“Social gaming by itself is not a sustainable investment,” Chowdhry said.
When Zynga filed for its IPO in Dec of 2011, it was riding high on the success of games like Farmville. But the games lost their popularity and its stock tanked.