Week in Mobile Games E42: Brawl Stars' highs, Squad Busters' struggle, & AppLovin's $900m games sale

[Music] hello and welcome back to the pocketgamer.biz podcast week in mobile games finally returned after a month's Hiatus get into the brief details of that shortly I'm I'm Craig Chapel head and CIT at pocketgamer.biz with me today is our news editor Aaron assel Aaron how have you been yeah I've not been too bad thank you yeah it's good to be back sorry everyone you've had to go without our delightful voices for a whole month what do you do I don't know what they I don't know how they made it through but I'm glad they're here now we're finally back it's all okay but yeah yeah I've been fine obviously yeah quite a bit going on over the past few weeks like we had um PGC in London which was great um it was a shame we didn't end up getting to do podcast

afterwards but um I'm sure a lot of people listening were probably there lots of coverage on the site by me for if you did miss anything yeah that was good and then record attendance at the show I believe as well I heard it was very good yes you heard it was I heard it was good the head of content of Pocket game his heard it was good yeah so how have you been so so uh apologies for the lack of podcast episodes I I was basically ill for about a month yeah I know I know as I said before like wores me but like uh I picked up a virus ended up getting some other issues I know why it's happened now because every time usually every time I take time off I get ill and I was plotting after PGC U two after I was like I'll take like a couple weeks off Haven had proper holiday for a while and then I got ill for three weeks so I guess that was my holiday

um but yeah that explains that that is the reason why we've had uh we've had no episodes uh but we're back now I'm back to health uh allegedly and we're good to go so hopefully we'll keep back on a regular weekly basis but it's good it's good to be back on the show and just chatting about mobile games because the world needs to know our opinions obviously do we're going to do it slight we're going to attempt to do it slightly differently we're going to try and do a shorter we try and do a shorter episode this week uh would love feedback on on what people think hopefully we'll keep it to about 30 40 minutes just condense it we know everyone's busy lots of podcasts to listen to before we get into the actual show I've got a few shout outs obviously for our events coming up this year uh we've got Pocket Gamer connect San Francisco March 17th to 18th I will also be in San Francisco for GDC so if anyone wants to chat tell us about something awesome that you're working on or or just catch please do drop me an email

craig. Chapan network.com we've also got the Dubai game Expo Summit powered by Pocket Gamer connects May 7th to 8th we got Pocket Gamer connects Barcelona coming in June 2025 PGC Helsinki is coming at you out on October 7th to 8th and also we'll be doing the mobile games Awards again during Gamescom in colog so keep an eye out for details on that over the coming months we'll start the uh the nominations SL lobbying process in a couple months so yeah plenty plenty going on but on the news it's been a really interesting week uh for kind of different reasons naturally the first thing we'll start off with is supercell so every year supercell well it has to by law in Finland publishes its financials but it makes kind of a big thing of it Ila the CEO Ila Paran always has a blog posts which I think many in the industry always paying attention to I feel like we'll go to details seate

like I feel like this year's blog post wasn't it was still really interesting just always interesting getting Insight what going on super Cale but because I think they've kind of discussed the major changes that they've been making and and kind of the decline over the past few years this year back on the rise and so uh I don't know I I didn't get as many insights but there are still a few bits to talk about so some key takeaways to quickly go through so they did nonap Revenue this time which kind of makes sense because because of bookings uh I guess that's how other companies do it but anyway Super's non-gaap Revenue Rose from 1.57 billion euros in 2023 to 2.78 billion EUR in 2024 it's about $3 billion that's about $2 billion I guess a gap Revenue I guess it's like with deferrals bit again non Gap from 492 million EUR to 876 million euros about 900 mil dollar uh last year

interestingly that is actually like they warned in the I think in the blog in a press release I can't remember what it was uh they warned like because it would be dramatically different if you if you included deferrals and yeah it's it's about 295 million doar with deferrals anyway it's portfolio garnered over 300 million monthly active players worldwide the company now employs 686 staff which is up 31% from 2023 I don't that includes figures sa from hiring this year they're still hiring super London is Now official technically is dead Long Live space eight uh so they they superal did the 100% acquisition of space eight last year that offers currently employees around 100 staff supercell is in discussion to transfer space ap's remaining portfolio as it focuses on supercells live games and London also has a new a new games team music title such as beat Star and country star have

already been moved to the supercell back Studio next beat which is led by space a co-founder Simon hay it's other games Crome Valley Customs that was it I didn't write these down Crome Valley Customs the Transformers game and fast lane I think are the remaining titles to be transferred to other Studios Ila said it's very important to them to keep those games live we'll see how it does with that and then who buys those and what that means some other interesting tidbit so I asked ilar basically about so it didn't executive kind of shake up is it last year the year before hir hir Sarah barus head of live game she's still there um she's got a a different title but similar role and they also hired a chief marketing officer who left ilka said and that was their first ever CMO ilka said that they have no plans to replace that role Squad Busters generated $100 million uh in Revenue in his first seven months

apparently all of Super's games saw year-over-year grow for the first time since 2014 and then some other interesting things apparently a big team so they've been growing all their teams a big team at the company is considered to be around 60 to 80 staff which is still quite tiny considering like some companies hundreds of people like on on just like a couple games or like one game so that's that's really interesting also talked a bit about the sparkk program which is like their incubator for for new team teams that's open to I think initially it was only open to internal they've opened that to external kind of talent the idea is to build teams and then those teams can build uh games uh but the main thing is they want to focus on building the right teams I think I want to say I think it was like three teams kind of have come through that and three or five teams come through that and working on new tiles so we'll see how they do and there was also a tease about Mo doco

their latest game that's been in of Clos beta it was like a wink wink him and so I imagine the game's going to come out in soft launch I don't imagine they'll go straight to Global launch again you never know after SC Busters but I think that will be a soft La so yeah there was some interesting stuff there there's a couple there was some interesting quotes about kind of the success of braw stars and the kind of I say kind of the failed launch really of squad bust as a supercell level game especially the money they would put into marketing they had a lot of celebrities All Star GM Frank sorry C kimberg kber I'm so sorry for the pronunciation he put the some of the games new success down to scaling the team enabling it to take more risks and also interestingly a lack of pressure that it felt within the company so a lot of the scaling up there was a big focus on Clash of Clans because that is that was super C's big Flagship game so actually there was less focus on a

team like braw stars and Frank said involved team plus less pressure equals High higher levels of creativity High appetite for risk-taking better decisions which leads to better updates equals winning players trust and their type which I I I I just found interesting obviously they did a lot of work and trial and error but uh it sounds like actually some of the a lot of the changes super been making have reworked out for that game Ila was like in his whole career he's never seen a game that a few years old suddenly just surge like it has and it's become their Flagship title also had some quotes from Eno joas about who's the game lead on Squad Busters or was the game lead and he he was talking about you know the decision to soft launch it and he said the game had good early metrics from 120,000 plus players in its most recent closed beta before it went live it was a favorite apparently among it creative Community but interestingly he he also identified supercell's determination to

ship its first game in five and a half years so you talk about a bit about like the pressure off of the broad Star Team weirdly it sounds like especially and I say weirdly just because of how super cellers run in theory where team's decision to launch not a top down decision but it sounds like there was just pressure to launch so he his quote was finally it been uh five plus years since launching braw Stars which was 209 and and he said as a company we really wanted to ship a new game then he adds we wanted to make sure we we do not fall in the Trap of analysis paralysis and wanted to be bold and take risks We Believe taking risks CR critical part of supercell culture which in order to become a company that is so tied up with success uh that we don't dare risk failure so I thought that was interesting and then he later says there were many aspects of the launch we might have done differently but he still fixs ultimately was the right call to ship it soft launching the game globally more time with it perhaps would have given us

indication of the true audience and what they want or perhaps not we will never know I asked lastly I said this going to be a quicker podcast it's not I I asked ilka did they have any regrets basically over the launch and how would it impact future release decisions looking at you Mo and he said or moo and he said everything that they've learned from the squad Busters launch we can now apply to any future game launches and he said admitting that the title was nowhere near the team's ambition ambition level and he said he said there be going to be a lot of changes key changes even kind of gamechanging changes over the next year as they look to kind of turn that around and into a success because supercell's never shut down a live game so curious if this ends up becoming the first I've talked a lot there I guess Aron what do you think about kind of supercell and some of the stuff that they discussed

yes obviously it's all very s of interesting to get those Insight I quite I guess it's kind of they have to put a positive spin on it but I like the sentiment at least of the like You know despite their size you they don't want to get the point where they're to afraid of failure to try anything like yeah I wonder if that's sort of something that too many companies across all sorts of Industries end up falling into and then you you know a lot of companies that get to that kind of s it's because they experimented and did something different um guess encouraging to at least hear that attitude of like yeah we'll you know take risks try something different even if it doesn't work out rather than just yeah you know do that once and then it be really successful and then just try and keep playing it safe thereafter so yeah that that stood out to me in particular I I I kind of think it's just still the antithesis of super celles culture like Risk taking in that you

could do in the design but It ultimately they need it's easy to say now I guess but well actually people kind of saying it actually to be fair people saying it at the time you're skipping soft LS that's strange there was some comparisons made by Ur to braw stars and how braw Stars could have you know I remember at the time like maybe it might not have launched it was in soft launch for a really long time I want to say 18 months maybe it was longer and there was like or maybe this just won't release globally they made a lot of key changes during that time but that 18 months gave them the time to make those changes before a full launch that you can only launch a game once I know BR Stars again kind of goes against that because then years later it has a massive surge Revenue but uh you still still the you can only lost once and people if they tap out probably not going to cut back I don't know I I I just think they should have test it and and I feel like the comparison of BR stars is a

bit strange in the sense that as I recall it but obviously it could be different internally the factors but they basically they Mak key changes which helped and then then they release on Android because it was in apps or only for a long time and that that's when they got kind of a lot more players in and I think that helps with the decision to go eventually to go Global and so you I feel like you've got all these changes and and factors and and data that suggested okay raw stars is going to be a hit and you just you don't they didn't have that see seemingly with Squad Busters it was just like we think this is a good game we're going to launch it obviously again kind of easy so hindsight but people OB time like yeah maybe they should have gone soft launch I'd be surprised if they did this again if if they didn't go through kind of a length

soft launch or at least a short soft launch oh the game's are game's amazing okay we'll go but like yeah I'd be surprised if they do this again good luck to them for if any company could do it kind of turn the game around it's super sale but you just have to wonder if there's like core issues with the game that they can't uh turn around basically we'll see going to move on to some other news so we'll go on to applovin they're going to sell so applovin plans was already agreed to basically sell its all its Studios and games so it's all all of its apps business for $900 million and so it's going to focus on its you know very lucrative ads business which has kind of been growing insanely I think in their financials it's like worth like the revenue is at least three times more than the apps business and the profitability is just vastly vastly Superior and that I think they keep in

their own cour they talked a lot about kind of um what was it I think was revenue or profitability per employee uh and I think the apps business doesn't fit into that I remember a couple I can't remember how long ago it was now two two three years ago an executive another company a very very senior executive he he said that again who knows I I assume I'm assuming it's true looking back but they were like they've been trying to sell that their apps business for years even then I think they've basically well they don't need it anymore and maybe they've kind of got what they needed out of it they probably got like they got like the data that they needed from these Studios the as business has grown incredibly and now they're just trying to get rid of it 900 mil seems like a still a steal to me so its partner Studios include lion Studios machine Zone Bela games magic

Tavern people fun and others all if someone buys all of those for 900 million that seems like a very good deal the only question is and it's been speculation for a long time when these ads ads businesses first started opening up or acquiring Studios and Hyper casual Publishers is what advantages did they get from that like you know the the rumors the that's the wrong word just the talk that could they like take data from Rivals to help them get a leg up for their own Studios or do they get better somehow better deals I'm talking about stuff I don't really know here so it sounds stupid that's why but but but there were very real concerns from Publishers I remember one I can't remember which of the ad companies it was but one publisher said well we can't work with them anymore and so they stopped because of like the conflict of interest of having an ads business plus having a publishing business which is a rival to your customers but yeah I 900

mil really interesting and the focus of that loving I'm curious who the buyer would be pler I have no idea Min Clips already bought 1.2 million and I don't know would they buy these Studios it's also weird that someone would buy all of them yeah it's good point we'll see another one to watch and then lastly from me Unity more Unity layoffs so it hasn't actually as far as I can see yeah like we we reached out for comment they they haven't actually spoken about it publicly which I feel like it's becoming a pattern of some of these big companies they just don't even talk about a public CER maybe maybe they don't see the point PR wise which I find strange because if you don't if you don't nip it in the bud and basically just be open about it take the hit then these stories can kind of drag on like something else could come out like oh this other division's closed kind of keeps the story going for a while and it just I feel like it's just not a good look it's even worse look because the story gets a bit out of control and so people are saying like they the 5 a.m.

informing them of their termination and immediate loss of system access kind of strange the apparently their behavior team has been closed which was a visual tool for NPC and object control at level did report that un CEO Matthew Bromberg has confirmed the company's latest job Cuts in in an internal memo to staff he said there were there were kind of leadership sorry amongst the changes are a consolidation of the unity adds leadership ship team in the US Ash Kazi will step down as Chief Revenue officer in the coming months after the transitions complete he was one of the iron Source uh people so I think quite a few of those have left now following the acquisition he's going to be replaced in the role by new executive in North America Bromberg said that these changes are response to choices we're making about the direction of unity about what direction Unity will take in the future and some of our colleagues' jobs will be impacted yeah it's I guess is Unity still going through very tough times kind of really

post runtime fee and how I think that just shook up the company because they wanted an immediate Revenue Source they couldn't really get it because they It ultimately had to backtrack and then eventually cancelled around time three and so a company that hasn't been profitable wider economic issues they've just gone through yeah well or as we all know thousands of layoffs closing various divisions and all that still seems to be happening for a company that I think you would once think Unity is so widely used it could never never hit these problems never close down it will always be there and I think with the runtime fee and just all of this kind of dragging on raises some question marks I think about maybe not really about it future I'm sure it may remain around but what that future looks like we'll see if these are the last one last layoffs for now but they keep happening sorry any any thoughts on app loov and unity yeah so obviously the app loving thing yeah it's interesting and as you said it's

like yeah strange that they're trying to sell them like all these studios in bul almost but yeah it was interesting when I was looking through like the financial stuff just how much the like ad Revenue side of things is like really picked up over the past year in particular so it kind of makes sense I guess if um I think it's something like 68% of their revenue was from um ads and then the other like 32% was from game so in a way it still seems strange to be willing to like to part with that you know 32% contributor because that's still pretty big but I guess if that enables them to focus more on the ad side which has been like yeah rapidly ramping up in how much it's making for them kind of makes sense yeah I mean I said it sounded like they wanted to get rid of it for a long time maybe they're like sometimes when I see these things it's like they're gearing up for to go public or or something and it's a better cell

to say we're a really fast growing company focused on this here's our profitability Reven per employee it's insane it's like a few million per employee so yeah although interesting they're still making layoffs they noted that in the financials call and they were like I swear the CEO Adam said like something to the to tune of we like one of the only like really profitable companies that keeps making layoffs all the time as if as if it was out of their control obviously they doing it for reasons but yeah yeah it's an odd thing to say yeah I thought so uh yeah haven't done story yet but they they according to California War notice they laid off more employees last month so yeah they're still kind of going through changes obviously there was major changes to adjust last year right I think that's uh so that's the

end of my bit which took us to 30 minutes of the quick podcast but Aaron you've got a couple stories what you go yes so obviously we've talked quite extensively on the podcast about Pokemon Trading Card Game pocket but any excuse for me to talk about it again so here we are and it's been quite rare to actually hear you know something official almost behind the scenes from like creators but thanks to developer DNA's latest financial report we actually have some kind of official word on it so yeah DNA said that the game has had a huge impact on their overall games Revenue which makes sense um obviously like estimates have put oit at like over half a billion in player spending already so obviously it makes sense DNA would see some of that although there's um kind of it's unknown what the split is but there's some split between them the Pokemon company and reach Inc who um make the like the physical card game but yeah obviously

DNA is getting some of this Revenue so they recorded a 60% year-over-year Revenue surge in Q3 which is the quarter that pocket release so that also made Q3 the fourth consecutive quarter of quarterly growth for them um and the game segment as a whole so all of their games made 120.4 million in profit that's converting it from Japanese Yen like over 100 20 million Profit just from Q3 so although you know they've not said that's all from pocket in Q2 they made 9.7 million profit and q1 was about 5.8 million so like drastically more it's like 120 million which I think is also quite interesting Q2 was their other Pokemon game's fifth anniversary so maybe that explains yeah so yeah I guess that maybe that's why Q2 was higher than q1 but still yeah Q3 when pocket released was like more than 10 times more profitable

which is kind of crazy um and yeah DNA acknowledged that pocket had a quote major contribution to the like profit rise in the the games category they also said that pocket has had a very high retention rate compared to other DNA games and a large number of users have signed up to the like premium Subscription Service in the game which I guess would suggest that it's kind of high earnings well be ongoing if people stay subscribe so yeah all around very kind of positive numbers there yeah there basically everything's going well for them as of Q3 pocket coming out so obviously the profit went up to like 120 million uh for games Revenue wise their game segment sales increased 29% year on year and yeah the profit surge was something like 8,000% yes ridiculous yeah 8,000 specifically 8,1

1268 games business profit BR yes was that was that for the quarter or for the nine months I'm pretty sure that was for the quarter and it came out what it come out October 30th crazy two bus basically yeah and yeah and it's still making I mean it's sort of slowed down again a bit now but the other week it hit like its most lucrative Day Ever based on M magic data so you know it's not like even just you pe but like a couple of weeks and then it's fallen off like it's still starting to establish a kind of wave of yeah increases and slumps you know as new stuff comes and then waiting for the next batch of cards but um yeah the latest set surged into like record revenues based on the estimate it's crazy how well this game done like it it like at least according to the magic estimates but also you kind of the revenue that they post [Music]

like sort of like sort of Pokemon goish levels which is ridiculous obviously it seems to be continuing as well yeah because um after its first month I wrote like a feature on the site comparing its launch month To Go's launch month and the revenue it made like 91% as much as go did which no other like Pokémon mobile game has come anywhere close so yeah it has been huge the OB caveat to that is and I'm sure I know the people at these Market intelligence companies are very clever I've I've worked to I've worked to so the it's like it's very very hard to calculate top like number one grossers like the estimates probably well it's kind of impossible right and I guess you got like nearly 10 years of inflation to factor yeah yeah there's that as well yes but still it's clearly been yeah a lot more successful yeah a super successful game and congrats to good DNA for doing that we'll see how it does the rest of this year yeah um

you've got one more story yeah so yeah my other one is about Nintendo so Nintendo this one triggers me a bit I'm looking forward to a rant in a minute hopefully yeah so Nintendo president shantu barawa stated during a recent shareholder Q&A that the company aims to continue developing mobile games to reach a broader audience so Nintendo hasn't actually released a mobile game since Mario Kart tour which was in September 2019 if you don't include Pikman Bloom which Niantic developed that released in 20121 but it's just using Nintendo's IP so yeah it's been over like five years since we've had an actual like Nintendo mobile game so like to me it seemed quite apparent that they just kind of slowed down on it after the switch came out and did you know really well CU basically every one of Nintendo's mobile games released between 2017 and 2019 and obviously the switch was

2017 but a lot of those games be in development before the switch came out and while they were you know struggling along with the Wii U I guess trying to diversify where they were getting their revenue from but then yeah the switch came out has been like one of the most successful consoles ever and we've had no new mobile games that seemed pretty obvious to me like you know where mobile stands in the company but yeah apparently Nintendo does still care about it according to for aawa so he said going forward even as we transition to Nintendo switch 2 it remains important to increase touch points between video games we believe that smart devices will take on a very important role in this endeavor and we will continue to conduct research and Implement initiatives which I mean I guess he's technically not confirmed there are any more mobile games coming but it's kind of a you know they're still looking at it then but apparently Nintendo's mobile games as a whole have surpassed 900 million install BS and Fire Emblem Heroes is their most Luc

it's the only one to have surpassed a billion again that's based on Magic figures so they you know they can make hit mobile games but they just haven't seemed to have bothered for half a decade and now they're suddenly talking about it again onto your I just I know that they have to the thing is I I know like they're asked the question that they have to say something uh and and they've decided not to say no but like they've literally confirmed that they are continuing to develop new game applications so they obviously did Nintendo music as an app that is another touch Point technically which I I think who knows how well that'll do but like I think it I feel like that's quite interesting potentially clever to try but to say they're working on new games like it's been as you said like last game the launched in 2019 this is it's taking longer than super and it's just there's a few things like their mobile games just haven't done that well now I

know people probably think sorry Fire Emblem Heroes obviously did amazingly well made loads of money billion dollar game that's like a proper mobile game right I still play that daily eight years in right A Proper mobile game that's probably why you still play it right these the other ones just weren't very good I I never really like Super Mario run the and it was premium and then Mario Kart T like it's made a few hundred mil so you know any any other Lo of Studios be like I'd love a few I'd love a few hundred mil for this game so you could you could argue to some to some degree it was a success I'm sure it was profitable so that therefore successful but it's like Mario Kart is Nintendo's biggest IP basically I was going to say like when you know it's Mario Kart we're talking about like it's huge so a mobile version of that in theory should do just phenomenally better it should be a billion dollar

game really yeah and then the other thing is you could kind of see how Nintendo just doesn't just doesn't want to embrace ultimately monetization and and really just actual how games are played how people won even want to play games on ball you got rid of the Gat mechanics in Mario Kart tour and now you can only subscribe and that was probably done a bit from Nintendo's eyes pretty bit late but to protect the IP and maybe avoid getting banned in some countries perhaps but like they just never embraced it to me they've made some other games that are just absolute absolute flops Dr what's what's left yeah ex that yeah Dr Maro Dr Maro world something and it's just like they don't care about it what could they possibly release now that would be good I don't think they will I don't think they should I say given it seemed like you know most of these were probably in development during the Wii U period and obviously they didn't know how the switch was going to do or you know how massive it was going to be I wonder if

they're kind of saying it because they don't know how the switch 2 is going to do if it ends up being another Wii U you know maybe they'll make mobile games again I don't buy that at all I just don't know why don't if they are working it's just pointless to I think the switch been super so super successful the switch to will be successful no doubt because it doesn't have the problem of like the jump from Wii to Wii U where it was like this is the same it looks the same but just simply calling it switch to I think just avoids yeah The Branding is more obvious like that it is a new thing yeah and like you said I remember at the time but it it was yeah because the Wii U wasn't doing well at all and then they for once Nintendo sort of caved it felt like Nintendo caved into investor pressure to do something and so they were like okay yeah we'll do mobile and then then they just sort of I I don't think their heart was ever really into it to be honest and perhaps just lot that the team Fire Emblem made a proper mobile game and that Nintendo was happy with that and

it's not really one of their biggest IPS either so maybe that's why no it's at least at the time compared to like Mario Kart and Animal Crossing and stuff like Fire Emblem is pretty neat I know it's got bigger over the years but I think at the time it wasn't like as major CU um the switch game three houses is now like the bestselling srpg so it has quite a bit bigger from that but Heroes came out like two years before three houses yeah quite a niche thing so yeah maybe that's why they were allowed to like make it but it just seems like a distraction for them just focus on switch too that's that's enough work yeah and then just for the rest of it just just license I think the licensing deals that they've done makes sense yeah deal Pikmin I always forget Pokemon is like a third owned or something fend but yeah Pikmin which do very well a certain level um right I think that brings us to the end of the episode

we'll try to do them quicker in future I will desperately try and not talk as much we'll see how that goes it was great to be back on the on the podcast again thank you all listening for for tuning in especially if you made it to the end well done there's no prizes I'm afraid other than our Eternal gratitude and all the insights that they've got out of it and all the insights everyone's got out of it I'm sure especially when I say I don't know much about this I I I attempt to provide insights elsewhere but I'll be honest when I don't fully know and yeah we'll be back fingers crossed I don't get ill again we'll be back again next week but yeah we'll see you again soon thanks Aaron for being back on the show it was great great to yeah yeah good to be back yeah and as well please don't get ill over the next week yes hopefully it won't spread through the through the computer exactly so yeah tun in next week and we'll catch you then have a good weekends goodbye